Plan to get Xmas all wrapped up!

Retail100’s Neil Amer offers a merchandiser’s view on planning ahead for the golden quarter

As you know, retailers never stop thinking about the all-important Christmas period. Whether you start planning in January or are just starting to think about it now, it really is the most critical time in retail, but planning for the bestever sales and the cleanest exit has never been so tough. Black Friday has put a real dent into when customers start thinking about the festive season, and has shortened the true selling window. Planning is key with anything in retail, but it couldn’t be more important than at Christmas. Getting the right products and ordering the right quantities can make or break your season. Now, no one has a crystal ball, so doing this is tricky, but you’ll have history and experience on your side. Use your knowledge of what has worked in previous seasons and how many you sold or didn’t sell.

will only be relevant compared to other categories or previous years. For example, if you have added options over time in a particular category, the RPO should grow. This will indicate that each option being added is increasing your sales and offering the customer the appropriate amount of choice. If the RPO is declining, the options are competing against each other and you are potentially splitting your sales and offering too much choice. This is a difficult one to get right - it really is like walking a tightrope.

3Sell throughs (what was sold vs what was bought) will help you understand whether the buys were too small or too big and help direct the quantities needed for your future season. This will help manage the risk at the end of the season - again another one that is not an exact science, but with the right analysis you can reduce your risk/ maximise the potential.

My top tip is to organise your data in a way that helps you understand what your customers need. Aggregating numbers to identify trends will help you understand the direction for your Christmas season - but how do we do this?

1

Rolling up last year’s sales by product type, colour, price point (or whatever is relevant for your stock) will allow you to recognise where your customers are willing to spend and where you should be placing your bets.

2

Layering on the number of products within this will help identify the return per option (RPO) and help you understand whether you have the right number of options within each product type/price band. This

4Layer on any macro trend that might impact purchasing decisions, for example, inflation, cost of living etc. This year, these trends have made retail incredibly tough, so you may want to consider a wider assortment at a lower price compared with previous years in anticipation of customers being less willing to part with their hard-earned cash.

This will help you form a base of your future product offering and build a robust financial plan and a seasonal best product offering. Of course, not everything will have history to analyse. If you have covered off a decent percentage of your seasonal buy with the methodology above, then there is room to take some gambles on new products. This is where the true fun happens - finding the new and seeing customers react to your creativity. Not everything will work, but this is not failure, it is merely more data to help you in the future. Then there is the all-important sale period. Customers love to grab a bargain, so make sure you plan for this too. For sure, the sale period is there to help you move through the stock that hasn’t quite worked for you, but it can also be a strong sales and profit driver - planning larger buys with reduced price sales in mind can work in some categories, and you never know, your customers might react well to these at full price and your sell throughs can be strong - an upside, but again, more data for you to work with for planning the following Christmas! However you are planning for the big season, enjoy Harrogate Home & Gift and any other trade shows you may be visiting, get inspired, find the best products, plan the buys and most importantly, have fun - retail truly is the best at Christmas!

Neil Amer is a director and co-founder of Retail100 Consulting, which is a consultancy firm with 100 years of retail experience that helps retailers and brands grow. Coming from a retail background, Neil worked as a merchandiser for John Lewis for 17 years gaining extensive experience in the retail industry. Learn more at www.retail100consulting.co.uk or contact us at hello@retail100consulting.co.uk

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