Are You Getting the Most Out of Your Holiday Season?

Posted on 19 Nov 2015

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Each year pawn shops can expect a spike in sales from Thanksgiving Day and throughout the Christmas season. This is a special time of year indeed, as item and jewelry sales spike on any given day as bargain hunters are out to fulfill their holiday obligations. Are you okay with the status quo or are you looking at last years’ numbers and trying to blow the doors off of them? This is a unique time of year to pull out all the stops; the choice is yours. Shops can generally see upwards of 30% of their total annual sales revenue during the holiday season each year. Do you have the data points available to you to capitalize on this unique opportunity that you have in front of you? Here are a few things to think about as you ramp up for this holiday season.

Customer Demographics

  • Were you tracking who your holiday shoppers were last year? If not, make sure you do this year. This is a must to capitalize on this season.
  • You should be tracking race, sex, age and zip code for your targeted marketing efforts.

 

Advertising

  • Did you ask your customers how they heard about you last year during the holiday season?
  • As every customer and sale is entered you should be making a single click in your POS to track how a customer was referred in to your store.
    • Understanding your where your customers are coming from gives you the ability to understand which channels are the best for advertising your business.

 

Sales Trends

  • Sales trends should be directly related to your Inventory Control.
  • What items were hot, which ones were not?
    • This is so important on so many levels:
      • Are you stocking up on these “hot” items prior to the season?
        • Do you have the specifics stored and accessible for you to be purchasing wisely?
          • Make, Model, Style, Color, Size, Designer and so on?
        • Who were you selling these hot items to?
        • Are you using up showcase and shelving space on items that were not selling?

 

Inventory Control

  • Are you running Aging reports?
  • This is directly related to your inventory turns.
  • What are you doing to increase turns?
    • Discounts are not necessarily a bad thing when trying to improve your inventory turns.
    • $150,000.00 in inventory moving twice per year only gives you $300,000 in revenue.
    • Let’s say at a 20% discount you increased you turns by 1, now that same inventory at $120,000 X 3 increases sales to $360,000. A gain of $60,000 in revenue.
    • What’s that look like if those turns increased to multiples of 4 and 5?
    • Now you are not only increasing cash flow but profits as well.
  • What are you doing with items that have been in the showcase or shelf for more than 90, 120, 180 days?
    • Your inventory control should alert you to these data points. You need to be aware of items that are tying up cash so that something can be done to get them sold.
  • Mass Markdowns
    • Do you have the ability to markdown entire categories or areas of your store easily and without retagging all of the merchandise?
      • At a moment’s notice you should be able to mark down lagging inventory without the burdensome hassle of retagging all of this merchandise. Set an area up on your sales floor where signage indicates the discounts given. Your POS system should recognize the barcode scanned and automatically ring the selected item with the discount already included.

 

Marketing

  • Assuming you have tracked your sales and customer information from the prior year there are several things you can do to bolster you holiday sales revenue.
    • Mass marketing
      • Targeting to the proper customer demographic is key.
      • Who bought what type of items and when did they buy?
      • Automation is also key in reaching you customers effectively
        • Sorted mailing lists and labels
        • Text blasts
          • Wishing Happy Holidays
          • % off certain types of items
          • Event text coupon for % off
          • Closeout special
          • Buy one get one at a % off
          • This week only % off certain item
          • Don’t miss out on our sale for % off, expires XX days

 

Signage

  • What does your holiday signage look like?
  • Is it inviting?
  • It is worth the minimal investment to maximize return.
    • Ask customers if they noticed it.

 

Sales

  • All the above is driving sales but what else can we do to take full advantage of this season?
  • e-Commerce
    • What are you doing to drive more traffic to your storefront?
      • List on Craigslist on a regular basis to not only increase sales but to gain new customers who may have never stepped foot in your shop otherwise. Do you have this automated?
      • List on eBay so that you have millions of prospective customers looking at your inventory
        • Do you have management dashboards to easily manage your e-commerce activity?
      • Website – Are you showing your holiday special sales and events?
      • Stay active on Facebook, list items to “Friends”

 

Protection Plans

  • Have you considered offering Protection Plans on hard goods or electronics?
    • Did you know that the increased revenues vs. repair/replace cost is heavily in your favor?
    • So not only are you providing a service to your customers that comforts them during the buying process but also you are showing them that you are standing behind the merchandise you are selling, all while you are increasing profits. The numbers behind these plans are staggering and can be automated through your POS.

 

If you have questions or would like training on any of these topics, give us a call at 1-888-949-7296.

Tom Streng

Written by Tom Streng

Tom Streng, co-founder and Chairman of the Board at Data Age Business Systems, is responsible for working closely with the executive team on growth and investment strategies for the company. Tom has dedicated nearly thirty years to establishing the company as the leading pawn shop software. As a pioneer in the industry, Tom’s expertise is second to none when it comes to understanding the needs of the pawn business, as he continues to actively contribute in several aspects of the operation including new product design, development, strategic partnerships and go-to-market strategies. He has published works throughout industry journals and has a Bachelor’s degree in computer science from Central Michigan University.

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