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Maximising gross profit at Christmas

Catherine Erdly outlines some of the ways to get the most out of the additional footfall that will be coming past your shop this Christmas.

Catherine Erdly is founder of Future Retail Consulting

The festive season, or the fourth quarter, is the busiest time of year for many retail businesses. Although it has become considerably more promotional in recent years, it is still a crucial time of year to maximise your gross profit.

This is the time of year where the volume of people out and about shopping is at its peak. In order to capture people passing the shop, make sure that your windows and signage are inviting. This will help the passing traffic translate into new potential customers.

Once they are in your store, make sure you are maximising your conversion rate:

Conversion rate = the number of purchasers ÷ the number of people entering the store.

You want to focus on keeping this number high or higher than it has been throughout the rest of the year.

How to maintain conversion rate

Some of the ways that you can maintain your conversion rate throughout the festive season include:

Consider also creating offers to entice customers back in the New Year. You want your new customers to not only leave with a great impression of your store, but to also have a reason to come back. Don’t forget to capture their email address for future marketing opportunities, and you could also offer a “bounce back” coupon.

“Bounce backs” are simply offers that are redeemable at a later date. A common approach in December would be to offer a £ or % discount for purchases made in January. This is a simple way to encourage your new customers to become repeat and then regular customers.

Communicating with regular customers

With this focus on attracting new customers, do not forget to reach out to your existing regulars. Now is the time of year to remind them to stock up on their usual products or try something new.

Make sure that you remain in stock of your core products in the run-up to the festive season, so that you are serving not only those looking for gifts but also those looking for their old favourites. It’s easy to put all the emphasis on purchases made for the festive season, but it’s likely that when you look at your numbers, you’ll still be making the majority of your sales on your core range.

Sending an email to your existing regulars, or just talking to them face-to-face, can be a great way to keep in touch. Be proactive in reaching out to your regular customers to make sure that they have everything they need and are keeping you at the top of their mind when they are thinking about their next shopping trip.

Trying new products

Although you will in all likelihood be taking the majority of your money on your core range, the Christmas period is a great time to take advantage of your increased footfall and try some new products in the shop.

The best way to do this is to create a clear testing strategy that you can learn from in future seasons. Put together a range of products that you wouldn’t normally stock - perhaps with more of an emphasis on gift-giving than you sell during the rest of the year. For example, is there a trend in the industry that you have considered trialing to see how your customers react? This is the time to do it.

You can create a clear testing strategy that focuses on trialing different prices (perhaps higher than you would typically sell, such as gift sets), different formats or even different categories of products that you would not typically sell. Buying small quantities of these products and displaying them in a prominent position in the shop will help you learn a lot about what you can sell during festive seasons to come.

You should not make any significant investment in this trialing strategy, but done correctly, it will give you valuable insights into your plans for the following year, and help you learn about your customer in the process.

Plan your sales peaks carefully

If you typically have a weekly sales plan, it is well worth creating a daily sales plan for the month of December, or at the very least the final two weeks.

Mapping out when you think your last minute sales rush will come will help you staff accordingly and avoid till queues which will damage your conversion rates. This year, with Christmas falling on a Tuesday, it is likely that the Saturday before Christmas is going to be your peak shopping day, as Christmas Eve is a Monday and some people may be working.

If you have been trading for a number of years, the best way to prepare would be to look back to 2012 which was the last time that Christmas was on a Tuesday, and review how the days shaped up that year. Even if your overall sales are different, the shape may well be the same.

Be aware of any festive activities in your local area that may create more footfall and skew your final few days.


Each year it seems as if the period from the end of November (kicked off by Black Friday) is becoming more and more promotional across the high street. However, there are many businesses that are now recognising that this relentless promoting doesn’t drive any additional sales but merely moves them from December into November.

If you are planning to run promotions during the peak selling period, here are a few guidelines to avoid them hitting your profits too hard.


Make the most of the busiest time of the year for your retail business by welcoming your new customers, keeping in touch with regulars and trying new products.

Careful planning is key – from the timing of your sales peaks to any promotions that you want to run.

Above all, enjoy the opportunity to connect with your existing customers as well as some new ones. But don’t forget to make a plan for a January spring clean and returning to life as normal!

Catherine Erdly, founder of Future Retail, is available to health stores as a consultant in creating greater success for modern retailers. Email [email protected] or visit

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