Avoid Disaster: What Not to Do as a Small Business Owner During the Holidays
The holiday season should be a time for small businesses to shine and earn some serious revenue, especially through online avenues and e-commerce websites. In fact, 20 to 40 percent of yearly sales for small and mid-sized retailers takes place within the last two months of the year. So, suffice it to say, it’s not typically the time of year you’d want disaster to strike if you’re a small business owner.
Here’s what you should avoid at all costs as a small business owner during the holidays if you also want to avoid disaster.
Website Crashes and Downtime
If you operate an e-commerce website, the last thing you want to happen is for your website to crash and be unusable at peak times during the holidays, especially on Black Friday and Cyber Monday. Not only will you lose out on much-needed revenue, but you could also potentially infuriate or worry customers if they don’t get their orders and payment information processed accurately and on time.
Having your website down, even for a short amount of time during the holidays would be a disaster for your profit margins – and your online reputation. Avoid website crashes and downtime at all costs. Read Website Maintenance Tips to Make Sure Your Site Can Handle the Holiday Surge for more information on keeping our site up and running when customers are looking to buy.
Inadequate Cash Flow
According to a U.S. Bank study, 82 percent of small business failures happen because of poor cash flow management or due to a poor understanding of how cash flow contributes to a business. Whatever you do, be sure to properly manage your cash flow during the holiday season and never spend more than you earn this time of year.
If you are counting on big sales and have ramped up inventory, you’ll need to come up with creative holiday sales and promotional ideas. You should also consider holding a pre-holiday or post-holiday promotion, to ensure your holiday revenue isn’t reliant on only a few days or weeks out of the year.
Neglecting to Prepare Your Employees for the Holiday Rush
During the holidays it’s common for retailers to hire additional staff to help with the extra customers and orders they receive. But whether they’re newbies or seasoned employees, don’t forget to prepare all your staff for the holiday rush so that they know what to expect and so that you can avoid disasters. Things can get very intense in stores on Black Friday and online for Cyber Monday. It’s so intense that retail giants like Wal-Mart are even using virtual training headsets, the kind that professional football players use, to prepare their employees for Black Friday rushes. Here are some real-life horror stories you might want to share with your employees too, so they know what they might be in for if your business is hosting a Black Friday event or sale.
While you don’t want to frighten your employees, make sure they’re prepared to cope with stressed and rude customers and chaotic environments, or you could end up having very unhappy employees, customers, or even potential lawsuits if disaster strikes.
Customers Who Steal and Abuse Return Policies
According to Deloitte, 82 percent of online shoppers want to be able to return items for free when they buy them online, and 69 percent want to be able to return items they purchased online in a local store. And while you want to be sure to give your customers what they want, also make sure you have a viable way to track all your inventory and products, whether they’re bought online or inside a store. Otherwise, scammers and thieves could exploit or completely manipulate your return policies, which would be a complete disaster. For instance, some scammers might try to return items to your store that they claimed to purchase online to get a cash refund for something they never actually purchased from you. Or some thieves might steal physical items from your store if you don’t have an adequate loss prevention strategy or policy in place. And it could be a disaster if the amount of products lost during the holiday season comes close to what you bring in for revenue.
Running Out of Inventory Too Quickly
Promising customers something that won’t be delivered is a recipe for disaster – especially if this happens during the holidays when most purchases are meant to be given as gifts. Not only will customers become irate and leave you terrible reviews if you can’t send their order in time, but your entire inventory count and operational costs will also be off-kilter for the remainder of the year. Make sure you’re properly managing your inventory at all times, so you know for certain that every order that’s placed will be able to be fulfilled.
Promising Products that Aren’t Manufactured Yet
To avoid disaster, always make sure that your manufacturers or suppliers can guarantee the shipment of your product in time for the holidays, especially if it’s a brand-new product for a brand-new company. The CEO of Ice Shaker admitted in a Creative Click Media post that his manufacturer kept delaying the shipment of his newly launched product, forcing his company to miss the Christmas deadline entirely, even though he already promised his customers their products in time for the holidays.
Security Breaches and Hackers
Online scammers and hackers live for the holiday season too, because they know that’s the peak time of year to infiltrate business databases and websites. They want customer data and payment information and wait for the holiday season to get it.
While Target is a mammoth of a company, it will be hard to forget how much their 2013 holiday security breach cost them– $18.5 million. And a small business website is typically much easier to hack. This could lead to a disaster situation financially as well as from a liability standpoint.
Not Properly Planning and Timing Holidays Sales
Don’t wait too long to promote your holiday sales, or your competitors might quickly outpace you. And don’t assume your customers will just find you and your offers online, regardless of how good they are. Always time your holiday promotions and plan your holiday sales campaigns strategically. Otherwise, your projected holiday sales could wind up being disastrously low.
Unruly Business Holiday Parties and Office Etiquette
If you want to host a holiday party for your clients or employees, remember to be cautious and accountable. Encourage responsible etiquette and behavior, especially if alcohol is available. While there are some pretty wild and funny holiday office party stories that others like to share, don’t risk embarrassing yourself or your company so much that it’s nearly irredeemable when the new year rolls around.
Be sure to heed the advice above and avoid disaster this holiday season. The success of your small business depends on it.