Here we go! The retail packaging and shipping industry is about to start the best season of the year. You know it-December! Merchants in the mail and parcel center business should understand that planning is crucial, since December can make or break your future business.

Some stores may deviate from the norm, however. You know your customer base (I hope), so you make the decision. We knew of a store in Massachusetts that was near businesses and major universities, and these markets supplied the majority of their sales. December was not that much different from other months, since many of their customers were on holiday vacation during December. In addition, if your customer base is comprised of summer tourists, then it stands to reason that your business may not adhere to the normal increase that most mail and parcel center stores experience during the holiday season.

Keep in mind, too, that if your customer base is largely the Jewish community, then your sales will be different from what we present in this article. We had a store for eleven years that was in the heart of a Jewish neighborhood, and the peak days at this store were earlier in the month of December. This article still may help these stores, but keep in mind that your high sales happen earlier.

Why You Need to Estimate Daily Sales
The first and most important step in planning for a holiday season is to estimate sales. December is unlike other months where you have a "feel" for what you will make in sales for each day of the week, and in which you may only estimate sales on a monthly basis. It is vitally important that you estimate sales day by day during December.

There are several reasons why a merchant in our industry needs to plan on sales day by day.

• Small package sales increase, so labor increases. We would much rather have one person work on a large custom job than two employees working on tons of small packages for the same amount of time and money, but that simply doesn't happen during December. You will get those custom work orders, however, if people know that you can pack and ship that huge dollhouse to their granddaughter. Overall, If one doesn't monitor labor according to sales, the checkbook may go into the red by the end of December. That would be a sad reflection on your management, since your checkbook can be in the green for a healthy start on the upcoming New Year.
• If you don't have enough labor, then customer service will suffer, and most likely you will lose business. If you think that people don't like waiting in a line now, just wait to see how irritable some can be during December . . . and understandably so.
• " If you don't have enough labor, then you may not be able to get packages out on time. Shipping packages as you receive these is most critical during December. TIP: Ship airs first, then use the FIFO (First-In, First-Out) method with ground, and never promise that something will be shipped that day when you can't do it . . . even if it's not guaranteed delivery. You've got to be on top of delivery times with all carriers and what your employees can handle in volume so that you can communicate effectively with customers.
• Sales projections on one day may be down due to bad weather or other conditions, so most of us have learned that we will "pick-up" those sales in later days. Cut the army on the slow days, and call in the cavalry for the upcoming busier days.

How to Estimate Sales
So how does one estimate sales, you ask? All I can tell you is what has worked great for us for the past seventeen years, but the first few years were guesses on how the consumers would react to shipping dates. We have been in business with several stores for eighteen years, and we kept daily sales records from day one, making notes on when we had bad weather or other conditions that affected sales. For example, if we worked on a large corporate sale for several days that was to be billed, the store may have saved the paperwork to ring in the cash register when the project was completed. We then used this information to distribute the sale among the days when the work was done.

In the beginning, we had to think like the consumers to do our sales projections, and fortunately, we did some pretty good guesses. Now we still think like the customers, but also we have actual sales figures/trends that work for us, too, to refine our decisions. The key is to look at trends.

Trends
We have found that trends are the key to estimating daily sales. The basic trend is that sales start increasing at the beginning of December, sales peak around the week of what we call Big Monday, which is normally the third Monday of December. Then depending on what day of the week Christmas occurs, sales taper thereafter. By the way, some people in our industry call the biggest day of the year Green Monday.

The basic trend varies according to what day of the week Christmas occurs. Those who have our Holiday Planning Manual can see the differences, but for those who don't, I'll recap the psychological impact that this important day has on the customer.

" When Christmas occurs on a Monday or a Tuesday, it's relatively easy for the customer to think about when packages need to be sent. "Next Monday is Christmas," they think, "so I should ship this the prior Tuesday." Big Monday is a big hit compared to the other days of the month.
" When Christmas occurs on a Wednesday or Thursday, the sales for the week of Big Monday are somewhat more level. Many customers know that they still can come in on a Wednesday or Thursday of the third week of December and have gifts shipped in order to arrive by Christmas by ground service. What customers don't consider is that most carriers only do deliveries on Christmas Eve, so air shipments level out sales the 3rd week of December . . . if your employees inform customers correctly.
" When Christmas occurs on a Friday, Saturday, or Sunday, the third week is strong all week. You may actually have two Big Mondays. Customers may think, "Hey, it's only the 17th, so I can shop this weekend!" These customers don't take into account that the next week is a short shipping week, so there is another rush with air shipments the following week.

Following is a graph on the trend for Christmas on a Thursday.

Estimating December Sales
Before we even discuss this topic, let me tell you that we assume that you have done adequate sales and marketing for your store and that you provide good customer service.

If you've already been in business for a holiday season, retrieve last year's December sales figures. First, estimate how much of an increase in sales you anticipate. This is when knowledge of your customer base is handy. Let's say that you have been experiencing a 10% increase in sales so far this year over last year. If your customers are mostly residential, then you may want to do a 10% increase over last December's sales.

If you have been actively pursuing corporate accounts for the year, and you attribute your 10% increase in sales so far this year to that, you may want to apply a lower percentage increase for December. Many businesses' shipping activity slows during this month, unless you actively pursue their holiday business.

If you are new in business this year, you may want to estimate two to two and a half times your average monthly sales for the previous few months to estimate December sales. You can always adjust your labor if sales fall under projections, and you will eventually use extra inventory that was purchased. Again, this is by no means what we say you should do, but it is just what we would do.

Overall, we have found over the years with our own business and with our contacts that December is two to three times over the other eleven sales months of the year for the average retail packaging and shipping business.

Over the past few years, we have been asking for data from other sources and for notes on circumstances that may affect the information. So far, what we experience is very close to what others who are the normal MPC store experience. We do include our store that had a large Jewish customer base. This helped the graphs, since this store also had Christian customers. Take the information if you want it, and please let us know if you want to share information to improve data.

Prepare
After you have calculated your daily sales, look at this carefully. View the graph. If you project to do $45,000 in sales for December, Big Monday is going to be a $4026 sales day, you will have to handle $3645 on the following Tuesday, Wednesday is $3110, and it doesn't slow down until the 23rd of December. You do the math. You've got the tables. Can you handle several days operationally for this amount of business and keep up to snuff with your customer service policies?

To let you know what we have known for many years is that once you go through several days on end of major sales days, you know which employees will make it as permanent employees and who won't. Also, it gives you a new perspective on what your business can do if you actively market it on an ongoing basis during the year. Somehow a $500 sales day isn't exciting once you've experienced a $6000 sales day.

Believe me, if you plan for December properly and have a great season, it will "pump you up" with energy and enthusiasm for "growing" your business more. You may need a few days to recuperate physically and mentally, but that's a good sign.

December planning should start by August, but ASAP (as soon as possible) is better than no planning. More information on these topics is explained in Holiday Planning Manual. There is a lot more to planning for December, so make it your objective now to have a successful season. Plan, plan, plan for success!

Suggested Products for the Holiday Packaging and Shipping Season

• Packaging & Shipping Stores Holiday Planning Manual
• Basic Packaging & Shipping 101
• Employee Handbook
• Packaging & Shipping Stores Guerilla Sales & Marketing
• Packaging & Shipping Stores Operations Manual

Other Articles & Pages of Interest:

• Holiday Planning Checklist
• Merchandise Your Store for Success
• Know Form I-9
• Start a Successful New Year
• How to Shake Hands in America
• Employee Theft
• Disaster Recovery
• Disaster Preparation for Retail Stores
• Become Uncomfortable to Increase Income
• List of All Articles

Print Free Store Signs