Supply Chain effect on the independent retailer
The world wide supply chain issue reportedly will affect all retail segments but will be particularly hard on the smaller retailer. Wal-Mart, Target and Cosco and the other large box retailers have the resources to find solutions to mitigate the problem. The smaller independent retailer has to have a strategy to lessen the effect of the problem of not having sufficient inventory for the holiday season. Gift cards have historically been important as an add on gift or to satisfy the shopper who is uncertain what to buy. This year they have to be a key part of your holiday strategy. Gift cards can keep customers engaged with your store and can be purchased in lieu of merchandise and redeemed once you have the goods. Here are some things to consider to keep your customers engaged with your brand during this supply chain issue.
• Be proactive an communicate your customers about the issue you are facing by email and digitally on all the social media platforms you use.
• It is predicted that 40% of holiday sales will be gift cards and younger consumers prefer them as a gift
• Gift cards drive customer loyalty and are over redeemed by an average of $59
• There is a cash flow benefit to small retailers in the form of an interest free loan
• Take special orders if you are certain that high demand merchandise will be coming in but late in the season.
• Utilize technology that supports digital E-cards that can be both purchased and redeemed online
• Display gift cards prominently on a holiday tree by the checkout and on your website as a product.
• Add 10% to the value of a gift cards starting at $50. $50 equals $55, $100 equals $110 continuing in $50 increments.
• Begin communicating with your customer as soon as the beginning of November. Amazon and Target have announced they will begin holiday discounts in early November.
The advantage you have as an independent retailer is your agile and can react quickly.