Rising gas prices, a still-shaky economy and the uncertainty of an upcoming presidential election aren’t dampening big retailers’ expectations for the holidays. A Hay Group survey says, of 14 major U.S. retailers, 75 percent expect an increase in sales compared to last year.
Big Retailers' Holiday Plan
Here’s a look at what big retailers have planned for the holidays.
Hiring. Big retailers are putting their money where their mouths are, with 57 percent planning to hire the same number of seasonal workers as last year, and 36 planning to hire more (a big jump from last year’s 10 percent).
Early start. The Hay Group says despite economic turbulence, retailers have “figured out how to operate in an uncertain business environment.” One way they’re doing this is by starting holiday sales and promotions earlier. While 58 percent plan to wait until November to start holiday promotions, 42 percent will start in October. This will allow them to operate lean—instead of overstocking, they’ll be able to see what products sell well in October and reorder in time for the November rush.
E-commerce. E-commerce is expected to be strong. Last year’s holiday season, which boasted 10 days that each had over $1 billion in online sales, has prompted retailers and e-tailers to fine-tune their e-commerce strategies all year long. As a result, just 12 percent of seasonal hires will be in distribution centers, compared to 74 percent who will be in physical stores.
Pricing. Retailers with brick-and-mortar locations are feeling more confident, too. Compared to last year, a smaller percentage of retail stores (18 percent) say they feel pressure to match the prices offered by online-only stores. And half of all retailers say they will cut back on discounts and sales compared with last year.
The optimistic outlook extends beyond holiday 2012. Some 43 percent of retailers plan to add more permanent workers and fewer seasonal workers this year, showing they expect strong sales to continue into 2013.
Small Business Holiday Planning Tips
How can your small business compete with the big-box ramp-up? Here are some ideas:
Get an early start. You, too, can benefit from soft launching holiday promotions early. Consider targeting customers you think will be most receptive, or promoting certain products.
Consider offering layaway. Layaway plans have been making a comeback at big retailers, and are a great way to garner what is essentially “pre-sales” so you can predict your cash flow with more confidence.
Discount with care. Consumers are still price-conscious, but it’s tough to compete with big companies on price alone. Instead, see where you can offer extra value that makes your products worth a premium price.
Hire now. The Hay Group study didn’t forecast a shortage of qualified workers, but with big retailers hiring permanent employees, competition will be stiffer than in years past. If you think you’ll need extra hands on board, start recruiting now for best results.