Category Archives for "holiday season"

Cyber Monday or Green Monday – Will you be Shopping On-line?

By Randall Orser | Budget , holiday season , marketing strategy , Personal Finances , Retail

Most of us have heard about Cyber Monday, the first Monday after American Thanksgiving when retailers offer many deals for us to buy on-line, but what is Green Monday?  

Green Monday falls on the second Monday in December, the name is thought to originate from the green colour of the American dollar.  The term was originally coined by Ebay in 2007 to describe the best sales day on their website in December.  Green Monday marks the 10-day shipping period before Christmas and is so successful because people realize that their time is running out to buy and ship gifts to arrive for Christmas.

As other retailers also adopted this day to offer their own seasonal deals (some call it Cyber Monday 2) Green Monday became the third largest shopping day of the season with sales in the U.S. of over $1.6 billion in 2016.  The retailers that usually participate in Green Monday are Walmart, Amazon and Best Buy and though popular in the U.S. the day is not as important on the calendar of Canadian shoppers, but it will probably grow in popularity in the future. 

The first Monday after American Thanksgiving was named Cyber Monday by Shop.org in 2005, although at that time as not many people had high speed internet connections they did not participate.  However, as connections speeds have increased so has the spending on Cyber Monday.  It was the biggest shopping day of the year both in 2017 and 2018 surpassing Black Friday.  Nearly a third of shoppers in the U.S. begin on the day before Cyber Monday and top stores such as Amazon and Walmart start cyber week sales on Thanksgiving Day.

Why Cyber Monday is so Popular

  • According to Adobe Digital Insights 40% of shoppers like the 24-hour shopping convenience.
  • The same number of shoppers wanted to avoid the Black Friday crowds.
  • 30% of shoppers enjoyed the ability to easily compare prices on-line.
  • Almost 90% of retailers offer Cyber Monday sales with 45% offering coupons or a percentage discount.
  • Over a third of retailers offered free shipping and 36% of shoppers said they would increase their on-line shopping if shipping was free.

A few on-line shoppers surveyed said that they would not buy on-line due to expensive shipping charges, or they didn’t like that they could not see or handle their purchase, or thirdly did not like to wait for their items to be delivered.

Mobile Technology and Social Media

Over a third of shoppers said that they would go to social media to get information about Cyber Monday deals usually on a company’s Facebook page and two thirds check out reviews on the company website before making a purchase.   More than half of on-line retailers make sure that they promote their sales on social media and that their websites are optimized for mobile devices.  

Impact on Brick and Mortar Stores

On-line retailing is growing by almost 10% annually and in 2020 is expected to reach $523 billion(USD).  In 2017 over 60% of people in 16 countries said that their everyday transactions were on-line rather than in-store.    This growth in on-line sales is having an impact on brick and mortar stores with more and more declaring bankruptcy every year.  It has been predicted that 75% of shopping malls will close in the U.S. in the next five years and those that do survive will cater only to high income consumers.  We can see from the number of closed stores in our malls that the same pattern is being repeated in Canada.

Black Friday Shopping – Retailers “Dirty Secrets”

By Randall Orser | holiday season , Marketing , marketing strategy , Retail

Black Friday is upon us once again, and we have been bombarded with ads on tv and social media for the last few weeks.  Black Friday started in 1932 in the U.S. when it was considered the start of the Christmas Shopping season.  The name Black Friday originated from the most popular idea that businesses ran at a loss or “in the red” from January to November, but on the day after American Thanksgiving they would return to “operating in the black”. 

Nowadays people shop in person (if they are crazy), or online if they want to buy in the comfort of home.  Though Cyber Monday has now eclipsed Black Friday, it is still a huge shopping day when millions of consumers hunt for bargains and retailers find new and ingenious ways to get them to part with their money.  Here are some of the traps that shoppers can fall into if they are not careful:

Doorbuster Deals” are Scarce – although ads are not allowed to be totally misleading, or tell you something that is untrue, it can tell you something without focusing on the details.  For instance, that ad announcing 60% off a TV will also have small print to tell you that quantities are limited especially if it is a doorbuster deal, so even if you camp out all night you shouldn’t count on getting one.  Although these deals are known as “loss leaders” and stores certainly lose money on them, they recoup it and much more when people hoping to get the deal stay in the store and spend more money.  

Deals Often Require you to do Extra Work – When you see a heavily discounted product you may also see (after mail in rebate).  That means that you will pay the full price on the day and you will have to wait to get your money back, which could take some time.  Meanwhile stores are hoping that with the Christmas rush and activities you forget to claim it which is true for millions of people.

Price Matching Disappears Black Friday week – Most of the year retailers are happy to price match as it makes sense for them to make a smaller profit rather than none at all.  However, some retailers will have purchased extra stock of items at a cheaper price so they can offer doorbuster deals, heavy discounted promotions or be ready to take a loss to lure in customers.  Their competitors will not honour these discounted prices as it may mean that they will lose too much money.

Before and After Prices can be Sketchy – Consumers are easily persuaded to buy an item when they see “Was $100 now $60, and similar offers.  Be aware that retailers can offer an item at $99.99 and then on Black Friday “50% off now $99.99,”  same item, same price but the perception that the price is heavily discounted is more likely to create a sale.  Stores are able to get around the legality of this by being able to use a base price to discount from even if the item has only been at that base price for only one day out of the year.  They can also use a “suggested retail price” as their base price even it is ridiculously high.   Some stores actually charge more for an item on Black Friday than they do for the rest of the year when the item is on sale, hoping that consumers will buy into the signage and the shopping frenzy. You can also see “Before” pricing that was the price when the item first came into the store, when in reality it has been selling for 50% off for many months, so any “deal” that you are getting on Black Friday may only be a small amount off the previous regular price not actually 50% off that price. 

Watch out for Time Sensitive Deals – When checking out those ads make sure to read the small print to see if there is a time period when the item will be at that price.  The idea behind the time limit is to create a false sense of urgency and a shopping frenzy.  You can expect the price to go up significantly when the sale time is over.  You might see an item at $10 at 8am, it goes up to $20 at 10am and is $30 by noon so it is not a good idea to shop around in this case. 

Many Black Friday Deals are Discontinued, Obsolete or Poor Sellers – Black Friday is a wonderful opportunity for retailers to get rid of dead stock, so beware if that something seems to be a good deal, make sure that you are still able to get refills etc. for it and that it is not obsolete.  You might also see products that are a poorer stripped-down cousin to the one that you actually want.    Rule of thumb is always if it seems too good to be true then it usually is.

Retailers Want you to Shop In-store not On-line -  They create a Black Friday shopping frenzy on purpose to attract you into their brick and mortar stores so that you will spend more than you planned to.   However, shopping on-line is making the rush to stores obsolete, you can find the same Black Friday deals the same day or even the week before.

So, make sure that you aware of all the “tricks of the trade” before you rush out to get that deal on Black Friday.   It is really just a day of bargain shopping, some prices will be good, but some items will be available at the same price or better on other days.  If you don’t need to have the item straightaway, consider avoiding the rush and buying on-line.

From an article by Paul Suggett

When Should the Holiday Shopping Season Start?

By Randall Orser | Budget , Employees , holiday season , marketing strategy , Retail , Small Business

There is no specific date when retailers should start their Christmas Holiday selling season, but customers would argue that it starts earlier every year.  Following consumer push back the Christmas retail season usually starts after Remembrance Day here in Canada, that’s unless you shop at Costco!  

Retailers who start their Christmas selling program too early, both in-store and on-line often find that customers are irritated by being bombarded with Christmas advertising, merchandise and songs in November and they are turned off of holiday shopping.  Hiring staff too early can be costly for a retailer, if there are not enough sales to support the extra staff and putting out Christmas inventory too early can be a waste of valuable retail space if it is not selling. 

When it comes to Holiday Season discounts and sales which are appearing earlier and earlier each year it is important to put a lot of thought into the products or services that you want to discount.  It really depends upon your business and your market, but these considerations apply to most retailers.

  • If the items are appropriate for the time of year, you don’t want to be selling summer season items in winter.
  • If the items are appropriate for your location – there is no point in trying to sell mitts and scarves in somewhere like Florida or Southern California, they need to be sold in colder climates.
  • Timing – whether your customers will have money to buy early in the season or they are most likely to spend when they get their Christmas bonuses.  You could consider a layaway plan for larger ticket items so they can be paid for over a number of weeks.
  • What you want to have in stock for after Christmas sales when people have more time to shop and likely have more cash and gift cards to spend.
  • Following what other retailers in your industry do if it is a good decision for your business.  It is always a good idea to know what your competition is doing but don’t start your holiday sales earlier because they do if it does not make business sense for you.

Starting your Holiday discounting too early although beneficial to some customers to others it is confusing.  Two months of constant big sales makes it difficult for them to know when to buy to get the best deal, it can also sap any sense of urgency and deter them from making major purchases on Black Friday and Cyber Monday.

Ideas for a Halloween Business

By Randall Orser | holiday season , Home Based Business , Small Business

If you are thinking of starting a seasonal business, statistics have shown that Halloween is a good time to do it.  Don’t bother thinking about trying to get into business selling candies or pumpkins, that Halloween business is already taken by bigger companies like Walmart so it would be pretty much impossible to compete. 

However, you there is scope with Halloween costumes and decorations to develop a business and cater to a niche market.  For example:

  • Providing Halloween music for parties
  • Creating “authentic” period costumes for adults
  • Providing Halloween decorating services for homes or businesses
  • Presenting in-house parties for children (a substitute for trick or treating.) or organizing adult Halloween events.

Also growing in popularity is visiting haunted houses.   Setting up your own could be expensive and turn out not to be as good as other ones nearby but providing tours of “haunted houses” and other spooky sites in your area could be a lucrative business.  Contact your local historical society to research the paranormal history of your area and you could uncover ghost stories that might surprise you and present them to your customers in an entertaining and exciting way. 

If you set up a decorating or party planning business for Halloween, it would not be difficult to turn this into a seasonal business for Christmas or even do the same for birthdays.  Once you are established and do a good job you might be surprised at how many clients you get and how much profit you can make.  

Online shopping is Booming in Canada – Be Part of This Growing Market

By Randall Orser | holiday season , Small Business

Although companies such as Amazon and eBay, command the online market, there is still room or small internet entrepreneurs with niche products or services to set up a profitable on-line business. 

Statistics show that the number of Canadians who shop online has grown from 19.5 million in 2013 to the projected number of 22.5 million in 2018.  37% of these buyers shop online monthly or more and 75% of these spend up to $200 per month. 10% report spending up to $500 per month.

The most popular items purchased on line are:  Books, music, movies and video games, electronics, smartphones, computers, clothing and accessories, appliances and tools and food. Five per cent of online shoppers purchased groceries but as more grocery stores offer home delivery, and with the coming of “DoorDash” and “Skip the Dishes” take-out delivery services, this food delivery niche market will experience major growth. 

Between 16% and 40% of people surveyed said that they preferred to shop online.  The percentage was larger with the younger age groups and less with the older age groups.


Why do people buy online – the three biggest reasons are reason are: 

  • Access to a worldwide market - Most anything you need can be purchased online including many things that are not available in Canada and a greater choice of goods.
  • Price - prices are still very competitive online but can often be less than brick and mortar stores.  In addition, many websites offer special sales for online customers only.
  • Convenience – with so many people working from home, it is much more convenient to purchase on line and have it delivered to your home, rather than braving the traffic to go to the mall.  You can also shop in your pajamas, and no one would know!  

Two of the biggest concerns for on-line shoppers were the security of their personal data, and not being able to return unwanted goods.   

Most people surveyed were comfortable setting up an online account with a retailer, but they were not comfortable when they were asked about their shopping habits.  Most Canadians trusted websites hosted in Canada with their personal information, but 76% had concerns about their information being stored in the United States.  

Many Canadian retailers allow online shoppers to return items to their brick and mortar stores giving buyers more confidence when shopping online.

VL Omni recently published their annual report on eCommerce in Canada which shows considerable growth and potential. 

  • In 2017 Canadian businesses sold $136 billion in goods and services online, up 42% year over year.
  • 62% of Canadians who shop internationally online would prefer to shop domestically.
  • 95% of small business owners bought items for their small business online
  • 23.5% facilitate “click and collect” and 68.9% allow in-store returns of online purchases.
  • Canadian businesses also sell their products through online marketplaces such as Amazon, Walmart and eBay.

Whatever your niche product or service there is still room for you in the online marketplace.  Now is a good time to consider what could offer online and to build a profitable business.  An online business provides a great opportunity if you are retired, a stay at home Mom or if you just need some extra income.  

 

How to Get More Christmas Sales for Your Small Business

By Randall Orser | holiday season , Small Business

During the Christmas Season there is only one thing that matters to retailers - the sales graph.  This can be make-or-break time for many small businesses and it is important that those sales climb as steeply as possible.

To get greater sales it is obvious that you need to get more customers. How can you get more customers? You need to make sure that more people see or experience the quality or unique product or service that you are offering so that they will buy. With a little effort and ingenuity, you can get potential customers into your store, and it might not be as hard as you think.  Here are a few ideas to help you to create your Christmas Rush:

Have a Sale

  • Most retailers have a Christmas Sale and nowadays they are not waiting for Boxing Day to do it.  Customers are inundated with Christmas advertising, so you need to make your sale stand out from the rest and be an event that everyone will want to attend. How can you do that?
  • Offer a big discount on a popular item for just one day.
  • Decide if you want to make it a discount or a free gift with purchase. 
  • Make sure your discount is worthwhile, people are not interested in only 10 or 20% unless it is a storewide sale.

Advertise your sale heavily on the best channels for your customers, social media, radio, etc. people need to hear about it to show up to your store.

Hold an Event  -  Create an event which ties into your product or services, for example a free cooking or home improvement class with a guest presenter, or a wine and food tasting with a chef.  Think about how this event will benefit the customer making them want to attend.

Use an Email Campaign - Social Media is a good way to get the news out, but an email blitz has been shown to be the most effective way to attract customers. Most businesses already send out an email newsletter so make sure it includes details of any sales or specials at Christmas. Feature items that customers will want as a limited quantity and create a demand.  You can also send out separate emails to “special” customers making sure that you personalize them offering them extra discounts not available to everyone, this makes them feel special and encourages them to shop with you.

Create an Attractive Window Display that is unique, eye-catching and foot-stopping to catch foot traffic that might usually walk right by your store.  Work your crowd, offer cookies or a free hot drink to people who are admiring your display to bring them into your store.

All of these strategies can be used as part of your Christmas Season marketing plan, but whatever you decide to do the most important thing is to get the word out to your target market and invite customers to your physical or virtual store.  Without customers your Christmas Season will be a non-event and not a good gift for your bottom line!

From an article by Susan Ward 

This Holiday Season – Shop Safely Online

By Randall Orser | holiday season , Personal Finances , Scams

During the holiday season millions are using online purchasing to avoid those hectic shopping malls.  However online shopping is different, you cannot meet the retailer or handle the goods prior to buying, and you cannot keep an eye on your credit card information.  Here are some safety tips to keep in mind when online shopping.

  • Know who you are dealing with – most of us shop with well-known retailers but if you are not sure about them check for their name, address, telephone and fax numbers on their website so you have their contact information.  Also check for quality assurance certificates or seals.
  • Look for websites that offer a lot of information about their products as you have to rely on their descriptions because you cannot touch or try on anything prior to purchasing.
  • Calculate the total cost of the goods and make sure to include shipping costs and duties if applicable to avoid any surprises when your purchase is delivered.
  • Read the terms and conditions of the sale.  These should be provided by the merchant in plain language and should include a description of the goods, the price, payment methods, delivery options, guarantees and warranties, return policies and your options if the goods do not arrive.  The merchant website should also include a simple process for handling complaints and inquiries and if applicable who is responsible for after-sales service.
  • Make sure you are comfortable with how merchants use your information.  Some use it to develop marketing profiles or sell it to others.  Before they do this, they should ask for your consent.  Reputable merchants will always publish their privacy policy.  If there is no privacy policy, you should think twice about buying anything.
  • Before providing financial information make sure the merchant has a secure transaction system.  Most internet browsers indicate when you are using a secure link. This will either be an icon, often a lock at the bottom of the screen or in the address bar of your browser, or if the website begins with https:// the s indicates that it is secure.
  • Be careful when buying from auctions as when you are buying from a private individual consumer protection laws do not protect you.  Read the rules of the auction site the better ones will have records of customer satisfaction and a system to resolve disputes.
  • Buying internationally might give you a good price but it involves more risk. Make sure you calculate the price with shipping and duties allowing for currency conversions and check that the goods meet Canadian safety standards.
  • If an offer sounds too good to be true stay away from it.  This includes a promise of a valuable prize for a low-cost purchase and any offer asking you to send money before you get the special deal.

With all this in mind, have a happy online shopping season!

Wait I Thought That Gift Cards did not Expire!

By Randall Orser | holiday season , Personal Finances

It may be a big surprise to you, but did you know that gift cards you receive for charitable or promotional purposes are allowed to expire? The rules and laws around gift cards can get a little confusing. Here are some examples where your gift card can expire.

  1. PRIZE – if a gift card is issued as a prize and used for promotional purposes the card is allowed to expire according to the Prepaid Purchase Card Regulation.  The business donating it must indicate either on the card or its receipt when and how the card can be used, and they can then set their own policies for the card when it is sold or issued for a promotional purpose.
  2. CHARITY – If you enter a draw for charity and win a gift card and there is an expiry date either on the card or its receipt it must be used by then.  Because the card was bought for charity it is allowed to expire as long as the donating business indicates on the card or its receipt how gift card can be used, they can set their own policies for use.
  3.  Cards issued for a specific good or service can expire.
  4. Cards that were sold at a discount for example a discount on services during a promotion are allowed to expire.
  5. If the gift card was bought before 2009 it is allowed to expire.

Cards That Don’t Have an Expiry Date

  1. MALL and RETAIL Cards: In BC, most retail gift cards, known as prepaid purchase cards, can’t have an expiry date or fees, however there are some exceptions and Mall Cards that can be used to purchase at multiple stores in a shopping centre are an exception.  Information as to extra fees, must be either told to you in person at the time of purchase or must be included in a folded-up document given to you with the card.
  1. PREPAID CARDS – such as prepaid Visa cards do not fall under BC gift card laws but are regulated by Canada’s Payment Products Regulations.  These cards which also include ones that you can buy at a grocery store checkout and are issued for a general dollar amount are not allowed to expire.  

From Consumer Protection Article Dec 14, 2016

 

Are you Planning to Give Gifts to Your Employees this Holiday Season? Do You Know What is Taxable?

By Randall Orser | Business Income Taxes , Employees , holiday season , Payroll , Small Business

At this time of year many employers give a Christmas or annual bonus – did you know that this is a taxable benefit if paid in cash or a cash equivalent such as gift cards?

You might think about giving your employees gifts instead of cash bonuses so that both of you will benefit on your Canadian income tax.  Employers can use the total cost of the gift as a tax deduction and employees do not need to declare the cost of the gift as part of their taxable income.

Under CRA rules all gifts to employees are considered to be taxable income except for the following exemptions:

1.   It is non-cash and less than $500 in fair market value per year and only given for the following reasons:

  • A Religious or other special event
  • Birth of a child
  • Wedding
  • Birthday

2.   It is a non-cash long standing service award valued at less than $500, this can be given once every five years.

3.   An Award for an employment related accomplishment.  These are allowed when:

  • It has clearly defined criteria
  • A nomination and evaluation process
  • Limited number of recipients

4.   Employer provided parties or social events where the cost is $100 per person or less.

5.   Meals or other hospitality services at work-related functions such as meetings or training sessions.

6.   Valueless items such as tea/coffee, snacks, t-shirts, hats etc.

There is no limit to the number of gifts an employee can receive in a given year as long as the total value is not more than $500.  Small gifts such as mugs or chocolates etc. are not included in the $500 limit.

If you want to give your employees gifts that are tax deductible for your company, you need to be careful what you give.  Items that can easily be converted into cash such as gift cards or stocks will be considered to be taxable employee benefits as will some performance related awards and bonuses.  Included under this rule are:

  • Gift Cards
  • Rewards that include employer-provided meals or accommodations such as trips
  • Cash or non-cash awards from manufacturers that are given to employers then passed onto employees
  • Points for travel, accommodations or other rewards
  • Gifts given by manufacturers to employees of dealerships

If you want to give Cash Bonuses or near-cash bonuses such as gift cards to your employees, it must be through payroll and must have taxes deducted.

For full list of taxable or non-taxable benefits and allowances visit the link below:
CRA's Benefits and allowances chart


Controlling Your Cash Flow Over the Holiday Season

By Randall Orser | Budget , holiday season , Small Business

The holiday season is almost here, and your small business is ramping up to sell more than it has all year.  Your orders are piling up and your staff is working hard to get shipments out to customers. 

At this time of year, many small businesses want to celebrate their achievements with staff and customers by giving bonuses and gifts and holding parties.  However, there might be a problem, where do you find the money to support all of this? You have a good balance of accounts receivable arriving in the New Year, but you need a better cash flow now.  Here are a few tips  to ensure that your cash flow runs smoothly over the holiday season.

  1. Make sure that your bookkeeping is taken care of and accurate.  This will provide an analysis of your profit and loss and cash flow and your current debt position.  Maybe it is time to hire a bookkeeper to keep you on top of these tasks and reduce the headaches?
  2. Develop and implement good collection plans and make sure your staff is trained to collect payments on time while still maintaining a good relationship with your customers.  Offer easy payment options to your customers giving them the ability to pay on-line or over the telephone. Giving a discount for early payment can encourage your customers to pay their bills quicker. 
  3. Take advantage of short-term lending – Waiting for late paying customers to settle their bills, buying new inventory, paying your employees or throwing that holiday celebration can strain your cash flow so you need to find short term funding that allows you to access cash immediately.  You could use your savings, credit cards, or line of credit.  Another option is obtaining short term invoice financing for instant capital until you receive payments.
  4. Delay Payments – work with your suppliers to extend your payment terms. The later you pay them, the more cash you will have on hand.  Another option is to delay your holiday party until the new year when you can still celebrate your achievements and the support of your staff and clients.
  5. Use your previous holiday season experience to gauge how much you are going to sell of a product this year and even when to run a sale.  Use a business analytics program to give you important information about your business to help you to increase profitability.
  6. Ensure that your team is well-equipped and prepared for the busy season ahead.  If you need to improve your customer service and nurture more sales hire a few part-time or temporary staff to help you.

Making these preparations to face the holiday season will help to make your busiest time of the year run a lot smoother and be more profitable.