Seasonal goods: how to sell out, increase profits and not go bankrupt during a sales slump

Entrepreneurs in the trade and service sector are familiar with the decline in customer and client activity. The main factor behind the decline is seasonality. It is influenced by weather conditions, time of year, holidays, and the economic situation in the country, which determines the financial condition of customers. Therefore, businessmen are advised to work proactively by determining the seasonality of goods, learning how to stimulate demand, make forecasts, and plan their assortment in advance.

Learn to determine the seasonality of goods

Most industries are experiencing a decline in sales, but don't panic. Experts recommend solving the problem in advance and developing an individual action plan. In order to develop a strategy, learn to recognize seasonality, which is often confused with the inability to do business.

Types of seasonality:

• If the difference in the norm is up to 100%, then the entrepreneur is faced with a tough seasonality (for example, selling garlands or traditional dishes at Christmas). In this case, tough marketing strategies will not help prevent a recession. For example, if we are talking about selling Valentine's Day cards, no interventions will help, as customers will show zero activity after the holiday is over.
• A difference in decline of up to 40% defines a strong seasonality. Requires interventions to prevent a decline in profits and bankruptcy.
• A 20% deviation is a moderate seasonality. It does not harm the business, so do not apply strategies to prevent it. Take this factor into account when planning.

During the seasonal period, serve customers without errors and work on increasing the average check. To do this, automate your business. Automation reduces the workload of employees by eliminating the human factor and the risk of errors, speeds up customer service, and helps to introduce new services. For example, pre-orders and delivery. The functionality of the Torgsoft business automation program helps to create loyalty programs, conduct re-accounting, control the arrival, and take inventories without closing the outlet.

How to stimulate demand during the seasonal downturn: 6 proven ways

• Method 1. Diversify your business. This means that when creating an annual plan, be sure to include a clause on a complete reorientation. It also means changing the market and expanding the range of products. Sell products in several areas. However, if you don't think about diversification in advance, you may suffer losses. To do this, assess risks, take into account possible force majeure, set goals, and think about the resources you will attract. A striking example of assortment diversification is shops selling plants and flowers. In winter, they focus on Christmas trees, in spring and autumn - on seeds and saplings, in summer - on flowers, shrubs, ornamental plants, etc. But selling food is a risky business, because if you don't plan the volume of the assortment and sales channels in advance, some of the goods will spoil, which will lead to losses. Sales will help you avoid a reduction in profits.
• Method 2. Sales. Experts recommend selling goods that are stored in warehouses and are waiting in line for next year, even at a lower cost during the off-season. This is because by the time demand for this type of product returns, trends, tastes and preferences of buyers, and the economic situation in the country will have changed. For example, clothing stores are not recommended to leave unsold summer dresses or shoes for the next summer. Set aside a rack in the store for these items, and consider dressing mannequins in the windows. A sign that briefly informs about promotions will also attract attention. Encourage customers to buy by showing them where they can use the items they bought during the off-season. In the fall and winter, vacation trips abroad to warm countries are popular, and this is the time to buy sundresses, dresses, summer shoes, beach bags, suitcases, or swimsuits.
• Method 3. New products. Make sure to introduce new products to your assortment during the seasonal decline. According to experts, the best time for such experiments is the "blind" months of January and July. Introduce unusual offers that will immediately attract the attention of customers. Showcase the product as unique to generate interest. Add a discount or gift and increase the price by 5-7%.
• Method 4. Motivation of employees. This practice is widely used in Europe and the United States. Make a sales plan and motivate employees to sell more by unobtrusively offering related products or expensive analogues. Pay bonuses or bonuses at the end of the month for fulfilling the plan.
• Method 5. Adjust the assortment. To avoid losses, change the assortment depending on the season. If we are talking about the restaurant business, then in summer, increase the number of soft drinks and ice cream, and in winter, on the contrary, let warming soups prevail in the menu, add types of hot chocolate, coffee, and tea. Serve even well-known varieties of an unusual design, and customers will perceive this product as a novelty. You can add an unusual ingredient and emphasize it. Speaking of food, unusual foreign recipes are in demand. For example, cool chocolate mousse with banana, which is made according to a West African recipe.
• Method 6. Try the "locust" behavior. This method is not for everyone. In a particular season, the store completely changes the assortment to meet the needs of customers. You can sell products that have no logical connection between them. For example, sunglasses and beach bags in the summer, snowboards, skis, skates in the winter, school supplies in the fall, and seeds and seedlings in the spring. You get the idea. This strategy is suitable not only for the trade sector, but also for other types of business, including the service sector. In summer, you install air conditioners, and in spring or fall, you insulate the exterior facades of buildings. However, to make this tactic work, think about the costs of purchasing the assortment and ways of selling it, expand sales channels, establish cooperation with partners and advertising. For example, in the summer, the store will be remembered as the one where people buy clothes, and in the winter, you will have to win the audience in a new way, because you will sell products of a different nature.

Additional tips for entrepreneurs

• Give each customer a discount card with their purchase, which they can use in 2–4 months. If you work in the retail sector, make a 10-20% discount on a certain category of goods. This strategy is used by service centers that offer paid technical support. In the off-season, the cost of such a service is reduced by 40-50%.
• Look for additional sales channels. The off-season reduces the workload by 40-60%, depending on the industry you work in. There is free time to create new positions and develop trading platforms. Use this period wisely. If the activity of the page on social networks drops in the high season due to the lack of automation and 200% workload of employees, start filling it with content, think over the content of publications, learn how to sell on marketplaces, add new features to the website, set up a client newsletter. Such actions will expand your audience in the long run by attracting customers. Find time for additional employee training.
• In 2020, businesses are active on the Internet. The use of social media helps to create positive images around products by selling emotions. For example, when choosing garlands or lamps, a customer needs to see the product in a photo, but in 90% of cases, they will make a purchase decision if the product is made "with a face". This means that if a photo or video depicts a person with positive emotions who feels happy about using the product, they will buy it twice as fast. Also ask customers to make video reviews, promising a discount on their next purchase. If you sell children's clothing, put a note in the parcel or package with the purchase that you are giving a 20% discount on subsequent purchases for the buyer to make a video of unpacking the goods and share the review on their own page on a social network, mentioning the store page. Such a move is used as part of storytelling on Instagram or Facebook.
• Show your customers where and how to use out-of-season products. Swimsuits are for swimming in the pool or going to the water park, vacations in warm countries, and tracksuits are for gyms. Ice cream - for children's parties, you can also demonstrate video recipes or life hacks using this product.
• Create and sell ready-made sets or kits. When it comes to clothing, sell lightweight hats or autumn gloves along with a winter jacket or warm coat, reducing the cost in advance. When selling cosmetics in the summer, put a windbreaker or hygienic lip gloss in a set with a refreshing shower gel and shampoo, which also prevents drying out.
• When creating a marketing plan, be forward-thinking and learn from the experience of million-dollar companies. In 2020, most information about competitors is freely available online. For example, marketers at Garden, a gardening company, are developing a plan for two years in advance. Part of the sales tactics are based on the results of sociological surveys that study consumer demand.

Also, regularly monitor competitors and market trends. Take into account micro and macroeconomic data. Involve professionals in this analysis who calculate the index of purchasing activity in season and off-season, predict economic downturns and growth, and exchange rates.