No one knows the importance of the holidays as well as retailers, who often rely on the fourth-quarter boost to put them in the black for the year. Holiday sales could reach $986 billion this year, according to a recent Deloitte forecast, an increase of almost 5 percent over last year.
As businesses prepare for the season, it's important to plan far ahead so as not to be caught in a predicament come November. "It's all about planning," says David Gilbert, CEO and co-founder of San Diego-based National Funding, which provides short-term loans and equipment purchases for small businesses. "Knowing your needs up front can avoid a lot of headaches."
In addition to ramping up advertising and hiring additional workers, consider these three tips for girding for an extra special holiday season:
1. Plan well in advance. Even though pumpkins are still dominating the advertising markets, the winter holidays will be here in no time. "October is usually when we see most businesses seeking funding," says Gilbert. "But September was our biggest month this year, which is a sign of a bigger lead-up to the holidays this year."
2. Consider short-term loans. To ensure you have enough product on your shelves, don't scrimp. If you need additional inventory, consider an alternative lender. But be absolutely sure to pay back what you owe in a hurry, as the interest rates charged on them are typically much higher than standard loans. Says Gilbert: "Alternative lenders provide easy, quick turnaround for small business needs, but don’t wait until the last minute." And pay them off promptly.
3. Lease equipment just for the season. The holidays provide a spike in business that is unique to this time of year. Gilbert says that businesses should "determine what, if any, equipment they will need to accommodate the increased sales. Some businesses need to rent additional cash registers, point-of-sale systems, and mobile credit-card readers to cut down on lines."
However your business chooses to remain competitive this holiday season, preparation is key. What else does your company do to prepare for the end-of-the-year rush?