November 28th
Aden Ferguson
The holiday season often means an increase in customers and revenue for small businesses, but it also comes with additional expenses. At a time of year when personal budgets are stretched thin, small business owners need creative ways to cut costs while still providing excellent service. We spoke with local financial experts and small business owners to compile some innovative ideas for reducing expenses this holiday season.
Get Selective with Seasonal Hiring
The holidays require extra staff to handle increased workloads. But hiring seasonal employees can become expensive, especially when considering training and payroll costs. Be selective when taking on temporary workers, advised Gabrielle, a regional HR consultant. Only bring on the minimum additional staff needed to provide good customer service. Cross-train current employees to take on extra duties instead of making too many new hires.
Offer Select Discounts Strategically
Holiday promotions and special offers can attract new customers, but margin-busting discounts may eat into your bottom line. “Avoid across the board percentage discounts that could gut your profits,” warned Karen, a marketing coach for entrepreneurs. She suggested targeted offers such as a free gift wrapping with purchases over $50 rather than a site wide 25% off everything sale. Handpick products or services to discount that still allow you to make decent money.
Reduce Hours Strategically
Trim opening hours to match prime selling times. Track your customer traffic patterns from prior years, advised a manager of a local retail store. You can likely condense hours during off-peak windows around the holidays to reduce utility bills and staffing costs without revenue taking a big hit. Utilizing this strategy has shaved nearly 15% off payroll costs with careful holiday hours management for the last two years.
There are always opportunities to tighten the purse strings during the hectic holiday months. With some strategic planning around hiring, discounts and hours adjustment, small businesses can create margin preserving ways to operate lean this December while still spreading seasonal cheer.
