While the Christmas period may be an important time for small business to grow their revenue, research from PayPal has revealed the holiday season is also fraught with peril.
44 per cent of small business owners reported to feeling concern around cash flow during the Christmas period. Business owners are also concerned about not being able to meet customer demands (33 per cent up from 29 per cent in 2017); letting down family and friends (33 per cent up from 25 per cent in 2017) and products not being shipped in time for Christmas Day (28 per cent up from 23 per cent in 2017).
In 2017 many small business owners were concerned with the potential impact from global retail giant, Amazon entering the Australian market. However, these concerns have appeared unfounded. This year, online competitors have dropped down the list of concerns (#3 in 2017 vs. #6 in 2018), and two thirds of SMB owners (66 per cent) said the arrival of Amazon has not impacted their sales.
Still, two in five small business owners report to feeling pressure to get the Christmas sale period ‘right’ whilst a whopping 86 per cent confessed to feeling stressed. Considering on average business owners expect to make 43 per cent of their annual revenue during the Christmas sales – the pressure and stress is very real.
In order to make the most of this peak shopping period small business owners were forgoing their own Christmas plans. A third of business owners said last year they felt like they didn’t have a Christmas (38 per cent) and didn’t have time to do their own Christmas shopping (30 per cent). Nearly a quarter (23 per cent) said they had to work on Christmas day.
Despite the pressures and sacrifices that come with running a business, SMB owners love what they do.Nearly half (46 per cent) feel a sense of pride when Australian customers buy their products to put under their Christmas tree.
SMB owners agreed the following strategies are effective ways of setting up for success in the lead up to Christmas:
- Use social media to promote your products (42 per cent)
- Sell on online marketplaces to increase visibility of your products (27 per cent)
- Make sure you are set up for fast shipping/delivery (39 per cent) and offer a good returns policy (23 per cent)
- Optimise your business for online payments (30 per cent up from 25 per cent in 2017)
- Offer a secure payment method like PayPal (43 per cent) – 2 in 5 respondents (41 per cent) said PayPal was their preferred method to receive payment, followed by debit/credit card (32 per cent) and direct bank transfers (23 per cent)
- Offer discounts (33 per cent) and complimentary gift-wrapping (18 per cent)