When is the Right Time to Stock Your Store for Christmas

Christmas brings a peak season for many businesses across various industries. From online stores to supermarkets, clothing stores, gift shops, discount stores, warehouses, chocolatiers, automotive stores, and a lot more – almost all businesses tend to see a significant impact and it’s hard to think of businesses that don’t.


Christmas Loans

However, it often happens that businesses stock up too little or too much for too short or too long a duration of time during the season. What we present here, is a simple and practical guide that can help your business understand when the right time is, for you to stock up your store. And yes, as we explain that, the information shall also help you work out an estimate of the quantities too, and for further reading related to that, there’s a link to a well-written article that we share for you!

Do You Have Historical Data?

Historical data can be of great help as an accurate indicator of trends for your business – after all, every business is unique and oftentimes, trends do tend to have a pattern. Yes, each year is also unique, but if your business model hasn’t changed significantly, historical data can be an invaluable tool for making decisions related to stocking up. Forecasting is often efficient using current market data in combination with historic market data and historic data of one’s own business.

Using indicators such as previous years’ sales during Christmas, Year-on-Year growth of your business, previous years’ market performance, and current year’s market performance, a fairly useful estimate can be made for the current year’s forecasts for Christmas season. Accordingly, the duration of promotional sales and inventory needed to support such sales can be estimated with decent accuracy.

Your Industry is a Key Factor

This is one of the absolutely important factors to understand – the industry in which your business operates, plays a key role in the way Christmas impacts the business. Certain industries like clothing, logistics, gift and stationery, etc. see a sharp rise, while industries like adventure sports, education, etc. see a slowdown, and industries like nightlife, entertainment, and banking can see varying trends from business-to-business and year to year depending upon various an in numerous factors.

Studying and understanding your industry and the impact of Christmas upon it, can help you understand how best to respond to it. Sometimes, business owners can use such data to enhance focus on sales and marketing, and drive sales of the right items to the right consumers during various seasons, taking much advantage of trends, consumer behaviors, and seasonality.

The 80-20 Rule

If trends across the market are to be spoken about, the 80-20 rule is strongly valid for Christmas sales. Study the data and trends related to Christmas sales across the US, and it becomes easy to see two trends:

  1. Close to 80% of the increased sales of most stores and businesses come from close to 20% of the items sold
  2. Close to 80% of the increased sales tend to come from close to 20% of the average promotional period

But why is this data useful? Well, it helps understand that stocking up for Christmas is not a one-time activity.

If your business were to utilize this data effectively, all that would need to be done to get it right is, that an estimate of 20% of the added inventory would need to be stocked up in earlier days of the promotional period. Thereafter, the increase in sales, the trends of demands for various items, etc. can be tracked. This data should help you decipher better estimates of what to stock for the true peak days, knowing that the peak days could see roughly 4 times the sale in roughly a quarter the number of days.

Other Factors to Consider

Apart from the three main factors, other important factors can significantly impact the way your business should respond to Christmas and stock up for it:

  1. Competition: One of the factors that are very hard (and perhaps not wise) to ignore, is the competition. What your competition does as a response to the season and how it seems to perform, can give your business hints related to ideas, forecasting, and also what to avoid focusing much on.
  2. Trends: A trend in business is often considered a friend, and thanks to the strong impact of social media today, trends are stronger and more significant than ever before. It’s often considered unwise to ignore trends and being on the right side of a trend can have a huge impact during festive seasons.
  3. The Economy: This is a strong external factor that has a very significant impact on the non-essential expenditure of the average buyer. Christmas expenses of the average household are very significantly impacted by the global, federal, and state economic health, and depending upon what markets you cater to, a slowdown or an uptrend can impact your business’ performance significantly.
  4. City Events: December may not be just about Christmas – a lot of big events come up during the season and depending upon which city your business is catering to, any major event in the city may impact your business, and such factors also need to be considered while taking decisions about stocking your store.
  5. Your marketing strategy: As much as an impact as external factors may have, internal factors including your marketing strategy may have the potential to unlock significant opportunities and may also have the potential to impact business far beyond what any external factors may have.
  6. Your sales efforts: Your sales are likely to be the ultimate factor that shall result in the outcome that the season holds for you.

Need Financial Help? Get an Inventory Loan for Christmas

Stores forecasting/expecting a huge rise in demand during Christmas often use loans to stock up for the season. We at BusinessCapitalUSA are an alternative lender offering a simplified and quick solution for funding. What more? We accept Christmas business loan requests from bad credit businesses and business owners as well! Choose us to get a quick loan for Christmas that gives you the cash boost that adding inventories for the season may require. You can also use the funds to drive your marketing strategy and enhance your sales efforts. If financing is what you need to make the best out of the season, we are here for you. Business Capital USA wishes you a strong season ahead and a Merry Christmas!

Further Reading

Statista – US Christmas Season Data

Forbes – How Much Stock to Order for Christmas