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How to prepare your business for Black Friday.

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Inventory Management

After a record-breaking 2021 holiday season, businesses are getting ready for more growth on Black Friday and the subsequent holiday rush. Insider Intelligence expects 3.3% in sales growth for the season, or more than $1.2 trillion in sales. While some of this growth will come from brick-and-mortar stores, ecommerce will be this year’s shining star with more than 15% in projected growth.

How can you prepare your business for one of the biggest events of the year? We review why Black Friday is so important, what key challenges face sellers and how you can prepare for peak retail season.

Understanding Black Friday

Black Friday is the Friday after the Thanksgiving holiday in the U.S. It’s often considered the informal launch of the holiday season and, for many sellers, is the busiest shopping day of the year. The shopping day also retains symbolic significance for consumers and sellers alike.

Why Is Black Friday Important?

Black Friday offers sellers an opportunity to connect with new and returning customers who are ready to buy. This influx contributes to revenue and is an opportunity to clear out overstocked or seasonal items.

Black Friday remains one of the most critical shopping days of the year for ecommerce and brick-and-mortar stores alike. While recent years have seen sales shift to other events, including Small Business Saturday and Cyber Monday, Black Friday shoppers remain a highly motivated audience that can have an immediate impact on your sales performance. 

What Are Common Holiday Business Challenges?

To reap the rewards of a successful holiday season, businesses need to plan for and overcome numerous obstacles. This can involve months of planning and preparation. 

Your inventory may be the first thing that comes to mind. It’s essential to make sure you have the right products available when customers need them. During your business’s peak season, that could mean a larger volume of orders from customers with more time-sensitive demands. Inventory management also requires a careful review of your storage and fulfillment processes. Meeting customer expectations requires aligning orders with inventory, warehouses, third-party logistics providers (3PLs) and any other relevant part of the selling cycle.

Additional challenges and considerations during the holiday season can include:

  • Scalability and performance.
  • Warehouse efficiency.
  • Pricing.
  • Invoicing and payment processing.
  • Promotions.
  • Data privacy and security.

No two businesses will share the same experiences and needs, but every seller can benefit from analyzing and addressing the above areas.

Getting Ready for Black Friday

Prepare Your Sales Channels 

One of the first steps in preparing your business for Black Friday is to confirm your customers can find you where they’re already spending their time. More than nine in 10 shoppers start their product search on a marketplace, and 76% have made impulse purchases via social channels due to the ease of purchase. 

Marketplaces such as Amazon and Walmart can offer your business some of the advantages of a large-scale retailer, while social channels can contribute to personal experiences for shoppers. Review your current sales channels and potential channels to find audiences that match your ideal customer profiles. Move your business to new channels with high potential before the peak season rush.

Manage Your Inventory

Effective inventory management is critical before, during and after Black Friday sales events. Inventory tracking and forecasting methods should be determined well in advance of the holiday season in order to prevent issues like stockouts.

It’s also important to centrally manage your inventory across all channels to have a complete, real-time view of your business and avoid overselling. For example, Mcslots, an ecommerce company focused on selling models and slot cars, created a successful multichannel strategy that included a direct-to-consumer website and products listed on ecommerce marketplaces. 

However, manually managing listings, inventory and orders was becoming time-consuming and putting the company at risk of overselling. This could cause the company to miss out on sales, provide a negative experience for customers and potentially harm the brand’s reputation.

To prevent these issues, Mcslots partnered with Linnworks to manage its channel listings, orders and inventory in a centralized platform. With more time to focus on the business, Mcslots could focus on customer satisfaction by expanding its product offering, offering 24-hour turnaround and developing bespoke, environmentally friendly packaging.  

Review and Update Your Pricing

Customers have come to expect deep discounts during Black Friday. But that doesn’t mean you have to start selling at a loss. 

Review your current pricing to determine what products can be reasonably discounted and at what price point. You don’t have to provide a discount for every available item. Offer enticing deals to gain customers’ attention, then convert that attention into sales with a great customer experience. 

When discounts don’t make sense, consider incentives such as package deals, buy-one-get-one offers, free samples or trials, or other ways to add value without sacrificing margin.

Plan Your Promotions and Messaging 

After you’ve determined your pricing strategy, you’ll need to figure out how to communicate that to your customers. While paid advertising campaigns may offer the fastest results, they can be costly and time-consuming. Don’t forget to look at existing platforms and tools such as social media, email and your website to promote your event. These avenues can be cheaper and also reach different groups of customers where they spend their time.

Review Your Shipping Strategy

The rise of ecommerce has coincided with higher expectations from consumers. Shoppers expect convenience, and fast shipping is a top priority. Meeting that expectation is crucial to winning buyers but can create complexity in logistics. The bustling holiday season can be chaotic without a coordinated effort between your business, warehouses, 3PLs and other touch points in your supply chain. 

As you review your shipping strategy, be mindful of time-sensitive orders and of the holiday shipping deadlines imposed by your carriers. Not accounting for holiday season order capacity and shipping deadlines can harm your business.      

Streamline Orders

Leading up to holidays, almost all orders are time-sensitive, whether you’re ordering products from suppliers or customers are placing orders with you. It’s essential to make the ordering process as simple and efficient as possible, including appropriate routing. 

For example, older inventory should be used for processing orders under the first-in, first-out inventory model. When possible, implement an automated order management system that connects sales channels, orders and fulfillment efficiently to streamline operations. 

Prioritize Customer Service 

While customer service should always be a priority, it’s even more important during peak retail season. Businesses are busy, and so are customers as they’re completing their shopping and preparing for the holidays. 

While selling products across multiple channels makes it easier to connect with your customers, it also makes customer service even more important and complex. One bad experience for a customer can have a detrimental effect on your business, as it’s widely accepted that the cost of acquiring new customers is much greater than retaining existing customers.  

Anticipate Unexpected Problems

Even with the best planning and preparation, there’s a good chance you’ll run into unexpected issues. These run the gamut, including supply chain disruptions, order delays and negative customer experiences. While you can’t plan for everything, you can develop contingency plans for the most common potential issues so that your team can quickly find resolutions that satisfy your customers and protect your business. 

Centralizing Your Operations 

Peak season, including Black Friday, can be an exciting and rewarding time for retailers, but it’s important to be prepared. Review the entire scope of your business from the perspective of your customers, starting with the moment the customer places an order through final delivery and any additional customer expectations beyond that. 

Is your business providing an experience you would want for yourself? Confirm your most important products are easy to find where your customers are shopping and that you can meet their pricing and delivery expectations.

Modern retailers have a presence across multiple locations, including their websites, marketplaces, social media and physical stores. This wide reach allows businesses to connect with consumers like never before, but it also means those businesses are managing a complex web of inventory, order and fulfillment simultaneously.

To get the most out of this holiday season, ecommerce businesses need a central platform to manage their online sales process, list across selling channels, process high volumes of orders and monitor business performance. With Linnworks, you can manage multichannel inventory easily across multiple marketplaces. You can also optimize your order and fulfillment process from a single location and gain deep insights across your sales and operations for fast decision making.

With a centralized platform and careful preparation, you can make the most out of this Black Friday. To learn more about steps you can take to prepare now, download our Holiday Retail Playbook for a successful 2022 holiday season.

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