If you're heading to any of the many tradeshows this season, hopefully you're going with a planned shopping list! Keep in mind your sales cycles and plan when you want to have new products available. This will help you ensure that you don’t have everything in at once, which helps your cash flow and means you have new products to refresh your displays arriving every 4-6 weeks to keep your regulars customers interested. Planning for seasonal events is a great way to prioritise your shopping list...
With Mother's Day looming already, lets think about Father’s Day: how do you know how much stock you need to buy for that and can you afford it?
- How long did you have your Father’s Day on sale for last year?
- What sales did you make over that period from products you bought especially?
- What sales did you make from products from your everyday range that you feel were purchased for Father’s Day?
- Do you think based on sales trends so far this year that you can expect to make the same sales this year more or less… this becomes your budget for this occasion/event.
- Will you use the same amount of stock, more or less?
- What stock do you have in the business that is particularly suitable for the Father’s Day period and how much do you expect to sell over the Father’s Day period?
- What value of product do you need buy to make up the difference in sales?
- Taking your average margin - what is the cost value you would need to spend to get this value of stock?
This becomes your budget/cheque book/open to buy.
You won’t sell all of everything you buy but you should aim to achieve an 80% sell though - so spend 20% more than you need…. but no more!!!
You should apply this principle to all events you buy for, any ranges you want to trial etc. This way you start to focus your spend and should not be spending too much!
And after the event you should do the stock sweep up I wrote about in my last blog (i.e. identify what is good enough to keep, what to reduce in a SALE and what to write off).
Making sure you know the cost and retail values of each group of products means you can plan effectively and ensure your seasonal events are profitable.