Tis The Season…To Get Busy

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“I had to chuckle when my electronic calendar beeped on August 1,” said George Schaefer of Schaefer’s in Skokie, IL.

At the end of last year’s holiday season, Schaefer had set the device to go off to remind him to get an early start on this year’s holiday catalog.

“Ideally, we would start working on the holiday catalog then,” said Schaefer, “but from a practical point-of-view, well, there are always other priorities.”

Of course, it can be difficult to get motivated about the holidays so early, but many retailers, including Schaefer, find the benefits well worth the effort.

For all his joking, Schaefer’s operation, has, in some ways, been at work on the holiday season since, well, last Christmas. Schaefer’s computer-systems person, for example, has been working on some new features all year. The goal: make the processing of holiday gift orders more efficient, by automatically producing UPS paperwork for orders that need to be shipped, by allowing staff to enter multiple addresses, by automatically adjusting inventory when a multi-product gift is purchased. “We don’t have a way for customers to enter gift orders online themselves yet,” said Schaefer, “but we hope to in the next year or so.” BDcover.jpg 1

For months now, Schaefer has been choosing wines for the holiday season, while others at the store have earmarked gourmet-food items — for example, at the Fancy Foods Show — for use in this year’s gifts.

According to retailers, it is the gift packages they create themselves that really benefit from an early start. “I started work on the holidays in April,” said Johnson Ho, owner of Knightsbridge Wine Shoppe & Epicurean Center in Chicago. “I’ve already ordered my custom-etched wine bottles and contacted food vendors about items for combination packs. I’ve got all my tissue and giftwrap. You have to work six months ahead in order to get the really dramatic pieces.”

Ho’s custom-etched bottles are bottles of wine customers can have engraved with holiday messages or their business name to give as gifts. “Some corporations order thousands of etched bottles,” said Ho. BDcover.jpg 1

John Farrell of Haskell’s Fine Wines & Spirits, an operation, headquartered in Minneapolis, with six stores in Minnesota and one in Naples, FL, has found a way to make sure his operation gets an early start with its gift business. At the beginning of September, Haskell’s rents a booth at a gift show for local businesses. “You don’t write much business right at the show,” said Farrell, “but they do remember you and call around the holidays.”

Customizing Gifts

Custom gifts can, retailers warn, be a labor-intensive part of the business. Indeed, some retailers, such as Schaefer’s, use a second location — in that operation’s case, a building around the corner from the store — to handle the assembling, shipping and delivery of these gifts.

Another operation, Happy Harry’s Bottle Shop, a four-store chain headquartered in Grand Forks, ND, has decided, this year, to hire an outside company to assemble its gifts. “We did it on our own [in the past], but doing that didn’t work for us,” explained Hal Gershman, owner.

Why create custom gifts at all, then? “It’s all about differentiation. That’s the theme of the decade,” said Ho.

For Schaefer’s, even the food companies at the Fancy Food Show might be too large, and therefore, their products too widely available. “We tend to go to smaller purveyors and cultivate suppliers on our own,” said Schaefer. “We try to stay away from products that every grocery store and liquor store is going to have.”

Each gift that is sent out — with the store’s name on it, of course ­ becomes an advertisement for the retailer. “The recipients of our gifts become some of our best customers,” observed Knightsbridge’s Ho.

For many retailers, the majority of their gift sales come from businesses, from corporations to professionals such as realtors, doctors and lawyers. At Knightsbridge, which does over $1 million’s worth of business in gifts annually, about 80% of those are bought by businesses.

To capture those sales, retailers have to have certain capabilities. They must be able to easily handle an order of hundreds or even thousands of gifts, each one going to a different address, for example. That’s another reason why Schaefer’s has worked to computerize its gift business as much as possible. That store even offers customers a small discount if they can email their order, in a form, such as Excel, that the store’s computer system can handle. Schaefer’s can also recall a company’s order from last year, which can make ordering this year’s gifts easier on the buyer. “It’s easier on us and it’s easier on them,” Schaefer said. “And when you make it easy on them, they become better, more loyal customers.”

Schaefer’s also gears its holiday catalog, which is devoted to gifts, to corporate business. “If someone is just buying one gift, a $50 bottle of wine for Uncle Joe, they usually prefer to come in,” Schaefer said. Therefore, the store’s pre-made gifts are targeted more toward business gift-giving: specifically, they are meant to be more broad in appeal and to fit in the price range — $25 to $75 — most often chosen for corporate gift-giving. BDcover.jpg 1

The other key to a successful gift business, retailers said, is to try to anticipate how many of each gift may sell. Pre-making gifts you know you can sell is efficient, but breaking down unsold gifts after the holidays is not. And while the wine, spirits and beer in unsold gifts can usually be sold in post-holiday sales, the gourmet food products are not so easily taken care of. Therefore, if Schaefer feels that he can sell 1,000 of a particular gift set, he will have only 600 to 800 made up ahead of time. “And that’s why we try to use products available locally, so we can order more if we sell more than we anticipated,” he said. “It’s a fine line: you don’t want to have to tell a customer you’ve run out but then again, on December 26, you don’t want to be looking at a whole lot of left-over gifts.”

Adding Extra Staff

Many retailers add extra help during the holiday season, of course, and again, retailers find that being organized in this arena can also help tremendously. Haskell’s John Farrell relies on word-of-mouth for most of his temporary help. “We rely on our existing employees, if they know someone,” he explained. “Probably half of our extra help is somehow related to someone here.”

Happy Harry’s Gershman has had great success with college students. “College students are very quick studies and are terrific with people,” he said. “And if we can get them for 1 or 2 years, which we can if we get them early enough, we’re happy.”

The fact that liquor-store employees must be at least 21 years of age in most, if not all, states does not rule out college students, he pointed out. “There are a lot of older-than-average students,” he explained, “people who have gone into the army first, for example.”

For the most part, Happy Harry’s student/employees work part-time, usually 16 to 20 hours a week, throughout the year. And then at the holidays, during their break from school, “we will give them all the hours they want,” said Gershman. “We can almost double our employee hours instantly.” 0110hp4

Once retailers get reliable holiday help, they go out of their way to keep these people coming back. At Schaefer’s, for instance, 75% of the people it hires at the holidays have worked at the store during previous years. Ho recommended that retailers remember to treat their employees, including their temporary ones, well. “We have a unique advantage,” he said. “We provide a nice working environment, a free gourmet lunch — and it is gourmet — and an employee discount.”

Care should be taken in how temporary help is used. Since it would be impossible to turn someone into a knowledgeable salesperson in a few weeks, most retailers train their temporary help only for certain positions and tasks: running a cash register, assembling gift baskets, driving a delivery truck, wrapping gifts. This frees up their permanent and more knowledgeable salespeople to work the floor.

Many retailers find the special services they offer, such as gift wrap, being inundated during the holidays. Advance planning and thinking ahead are key when it comes to handling these increased workloads. At Haskell’s, for instance, all employees brush up on their gift-wrapping skills by attending special classes in September.

Efficiency can be planned ahead of time, too. Schaefer, through the years, has perfected his gift wrap to be handsome but also efficient. The store has its own special gift boxes, embossed with its logo, which can slip easily into a shipper. And when shipped, these boxes don’t require additional packaging to protect the bottles inside, the way a traditional gift basket would.

Party-Planning Operations

There is one kind of holiday business that doesn’t require a whole lot of planning and is not particularly labor-intensive. “Parties are as big as gifts,” said Haskell’s Farrell, “but they are a different kind of business. The dollar volume is just as high, but they are a lot easier.”

Knightsbridge’s Ho reported that his wine sales, not counting gifts, go up 40% during the holidays. “There are some big parties, but also many smaller parties, office parties or a small business entertaining its customers or a doctor having a party for his staff. Most of these occur in homes or conference rooms and they are a much overlooked piece of business,” he said.

Many retailers name one or more of their employees as their party-planning experts and direct customers’ party questions to them. To make the process even more efficient for his stores, Farrell has a special party-planning phone number for customers to call. “That number gets very, very busy during the holidays,” he reported.

And like many retailers, Haskell’s offers added-value services. The chain loans party customers glassware at no charge, for example. Other retailers provide free ice or the free loan of coolers. Haskell’s can also hook a party planner up with bartenders.

Stores with gourmet-food sections often pick up extra business by providing hors d’oeuvre trays for parties, although many retailers are quick to say that they purposely limit their catering business. Although Sigel’s, a large chain in Dallas, has added gourmet-food centers, complete with a deli, a coffee bar and a pizza-making station, to two of its stores, the operation stays away from full-service catering. “If you are not doing catering full-time,” said Sigel’s president, Louis Glazer, “if it’s not your main focus, it’s not a place you want to be.”

Reorganizing the Sales Floor

Many retailers reorganize their stores’ floor plans to accommodate the extra business of the holidays. Sherry-Lehmann’s in New York, for example, has very little room, 1,800 square feet, in its store. But that space must work as efficiently as possible during the six-week holiday period, when the store does a full 35% of its annual business. This operation adds three computer stations, bringing the total number to 12, at its sales counter, and on the Friday after Thanksgiving, builds a gift display in the center of the store.

Some stores suspend their regular wine tastings. “Though our tastings are important to us throughout the year, people do tend to linger at them and that causes problems with parking,” explained Schaefer. In fact, Schaefer’s converts its tasting room into a gift boutique for the holidays.

Not everything has to be done early. Take decorating the store, for example. “I don’t believe in having Santa up in September,” said Knightsbridge’s Ho. “We decorate for Christmas on the weekend after Thanksgiving. This trend of decorating earlier and earlier dilutes the holidays and, I think, backfires for a lot of companies.”

So, though the holiday rush will always be those last six weeks of the year, now is still an excellent time to start making your lists and checking them twice. * [bd/2001/0110/00bfd.htm]

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