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The holidays might just be the easiest time of year to fall into debt, and it seems many Americans are ready to make a decision that could actually make that more likely.
Even though we’re only at the tail end of summer, retailers have already spent months gearing up for the holiday shopping season.
And due to a tornado of factors — including inflation, supply-chain woes and consumer spending habits that changed during COVID-19 lockdowns — retailers are looking ahead to a shopping season that promises to be even more challenging than usual.
It’s critical to prepare for the holiday season, because Black Friday and the weeks beyond can make or break a brick-and-mortar store, says Richard Rizika, partner and co-founder of Beta Agency, a commercial real estate agency based in greater Los Angeles. Rizika was also a vice chair in the retail services group at CBRE, one of the world’s largest commercial real estate investment firms.
“Many of the merchants haven’t made money this year and are counting on that push through the holiday season to produce the profits,” Rizika says. “If things fall flat, or you miss the merchandise or the consumer just doesn’t show up, it can be tragic.”
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Thankfully, there are things business owners can do to set themselves apart amid a shopping environment that’s even more cutthroat than usual.
1. Get the word out about holiday sales early
Gone are the days of customers idly wandering the neighborhood or the mall and popping into stores. Today’s consumers are doing far more research before stepping foot into a store than they ever have, says Sean Turner, co-founder and chief technology officer of Swiftly, an e-commerce technology company.
“I think the biggest thing is being able to get the word out to consumers effectively to celebrate the savings and deals that they have,” Turner says. “Consumers have gotten a lot more planful.”
It’s a smart strategy for retailers to advertise their upcoming holiday sales as much as possible: through in-store signs, yes, but mostly through their websites and social media presence. Those are the platforms customers are checking before they choose whether to visit a store, especially if they’re planning to spend more than they typically do on nonessential items.
“Show them great savings and deals to drive that trip,” Turner says.
2. Better yet, launch sales earlier than your competitors
Sure, you can get customers excited about your upcoming sales. You could also roll out those sales earlier than your competitors, and even before the holiday season unofficially kicks off with Black Friday (Nov. 25 this year).
“Don’t be afraid if you’re a retailer and a good operator to make those deals available earlier than you have in the past,” says Jason Baker, principal at Baker Katz, a Houston-based retail brokerage.
Even if you can’t roll out your landmark sales before the holiday season, consider offering smaller sales now to entice shoppers into your store. If they aren’t familiar with your brand, those sales could bring customers back to complete their holiday shopping with you in a couple of months.
“Retail’s an early-bird game,” Turner says. “The first place you see the deal and you decide to buy it — guess what? That’s a product you’re not buying at another retailer.”
3. Have a top-notch website
If your store doesn’t already have a website, it’s too late to make that happen before this year’s holiday season, Baker says. If you have one, make sure it’s at least fully operational, user-friendly and completely up to date on your current inventory and availability. It’s a good time to polish your social media presence as well.
Retailers can optimize their website for heavy holiday traffic by “clearly marking which merchandise is out of stock or unavailable and sharing delivery options upfront,” says Peter Messana, CEO of Searchspring, an e-commerce software company.
Of course, these improvements aren’t needed just for the holiday season. Roughly 17.2% of all retail sales happen online, excluding cars and restaurant purchases, according to CBRE. And around 80% of shoppers first search for a store’s website before visiting the brick-and-mortar storefront, according to a 2021 survey conducted by Visual Objects, a creative design directory.
The best retailers, Rizika says, are “not only engaging while they are open — they’re engaging while they are closed.”
“Talk to the consumer and sell to the consumer while your doors are closed, through your ability to engage with them online, whether that’s with a great website or social media,” Rizika says.
4. Create an inviting place that’s more fun than online shopping
No longer is it enough for brick-and-mortar storefronts to showcase top-notch products and services. Today’s businesses need to make the store a destination that’s even better than the conveniences of online shopping.
“To use the store as a competitive advantage to me is something that the small business has to learn how to do,” Rizika says.
These improvements don’t have to be huge. If you’re in a temperate climate that allows year-round patio seating, consider setting up a couple of chairs or tables outside your store if that’s permitted. Maximize your store’s natural lighting. Set up some pretty, place-making plants around the store. Heck, see if there’s room for a comfy couch or some stylish chairs at the front of the store.
The point is, think about small ways to activate the space.
“Owners thinking about their places as brands, and trying to connect their brand with the consumer, is something you’re seeing great retailers have done for a long time, and more and more retailers are starting to recognize that trend,” Rizika says. “All these things that have become more and more important to us as consumers.”
4 non-investment questions to ask an adviser before retiring
What you should be asking your adviser
Using a financial adviser for your investment needs is 100% on brand, but what about the other parts of your retirement life? For example, a third of people ages 64 and up have a financial adviser, but only 2% of them asked their adviser to help with their Medicare choices, according to a July 2022 report f rom health care consulting firm Sage Growth Partners.
But Medicare and other non-portfolio topics — like travel and long-term care — can affect your finances.
“We are actively bringing these ideas to our clients, but there are still plenty of advisers out there that are not,” says Crystal Cox , a certified financial planner in Madison, Wisconsin. “They’re still focused just on the investments and the portfolio.”
Here are some questions to ask at your next meeting.
1. What retirement decisions do I need to think about?
Your life in retirement may not continue as it has in the past. Do you plan to travel? Do you intend to move to a different state or downsize? How often will you want to buy a new vehicle?
“Most people just think, ‘I need a certain amount of money to live on,’” says Daniel Lash , a CFP in Vienna, Virginia. “What about all the ancillary things that come along with living? All the things you want to do?”
Mapping your retirement plans can help you and your adviser pinpoint when and how you’ll need cash.
“Do you have an idea of where you’re going to move, and what does real estate look like in that general area?” Lash says. “They’ve thought about retiring, not ‘What am I going to do when I retire?’”
2. What should I know about Medicare?
Although you generally can’t sign up for Medicare until you’re closer to 65 years old, your income in the years beforehand will affect what you pay for coverage. Each year, both Medicare Part B and Medicare Part D base their premiums on your reported modified adjusted gross income from two years prior. So if you filed individually making more than $91,000, or filed jointly making more than $182,000, you’ll pay additional amounts each month.
“Because there’s a lookback on earnings for Medicare expenditures, we’ll adjust plans accordingly, because they might be paying considerably more the first couple of years in retirement than later in retirement,” Lash says.
It’s also wise to consider guidance on Medicare choices in general, because you sometimes can’t change coverage later if your health situation shifts — and Medicare is complicated. “We do an annual meeting with somebody that specializes in Medicare,” Lash says. “All clients are invited to attend.”
3. Can I afford to self-insure for long-term care?
A person turning 65 now has about a 70% chance of needing some kind of long-term care, and costs are steep: It’s $54,000 a year for an assisted living facility and nearly $95,000 for a shared room in a nursing home, according to insurance company Genworth’s 2021 Cost of Care Survey.
“Some people are well enough off that they’re comfortable self-insuring,” says Kevin Brady , a CFP in New York City. “Others have more limited assets.”
No matter what is the case, it’s crucial to discuss potential costs and whether you have the savings to manage them. If you don’t, you’ll need to run the numbers on products like long-term care insurance or a hybrid policy that combines permanent life insurance with a long-term care rider.
“We’re always working with an expert to do projections and see what makes sense,” Brady says.
4. Do I have enough money to have some fun?
A successful retirement isn’t always about the tangibles. For many, it’s a time to realize dreams of travel and other experiences, but spending too frugally can get in the way.
“Often clients are overly conservative for fear of running out of money, but in the process they shortchange the retirement experience,” says Kevin Lum, a CFP in Los Angeles. “By the time they realize their abundance, they’re too old to spend it.”
Talk to your adviser about your big-ticket wishes and whether you have enough money to splash out a little before you settle into quieter spending.
Actual retirement spending looks more like a smile than a straight line, Lum says, with more spending at the beginning on things like travel and more spending at the end on long-term care needs.
“I’m not saying people should spend irrationally,” Lum says. “But thinking about retirement spending as a fixed calculation that doesn’t change across the retirement life isn’t a smart idea.”
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The article 4 Things Retailers Can Do to Prepare for Holiday Shoppers originally appeared on NerdWallet.
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