Christmas is good news for most retailers but what happens if you overdo it and are left with unsold stock?

It’s so easy to get carried away at Christmas. Consumers wander round the shops thinking ‘Christmas just wouldn’t be Christmas without... Quality Street, Roses, a Terry’s Chocolate Orange, a chocolate log, mixed nuts, satsumas, booze, crisps, more booze’. The list goes on. But pity the poor retailer who is expected to carry all this stock - what if he gets it wrong and is left with piles of unwanted yule logs and flashing santa hats?

According to Sunder Sandher, who has a Londis store in Leamington Spa, Warwickshire, you need a strategy. He’s got one and it works for him: “When it comes to seasonal goods, I always make sure I get sale or return from my suppliers so there’s no risk and therefore no loss. Anything I do have left over, I sell off cheaply within seven to 10 days - you’ve got to get rid of it as quickly as possible. You might make less of a profit but at least you’ve sold it before it’s out of code. Some items you could hang on to for next year but I prefer to get rid of them. We have to shift them because we need the space for the next big occasion - Valentine’s Day on February 14.”

Sunder says that having epos is definitely a big bonus as it tells him what sold well and what didn’t the previous year and he can tailor his order accordingly.
Caution is the watch word for Satish Patel of Squire Stores in Richmond, Surrey. “We are definitely going to order less this Christmas because Christmas Day is on a Sunday, with Christmas Eve on the Saturday, so the slowdown will start on the Friday evening.

“We don’t like to be left with any unsold stock so we always order less than we think we need.”
Gloria Williams from the Village Stores in Hook Norton, Oxfordshire, says she’s no Scrooge but she’s cut out all the Christmas frills in her shop. “For the past four or five years we’ve stopped jumping on the Christmas bandwagon and stuck to what we do best - the basics.

“We used to stock the whole hog - cards, decorations, you name it and we sold it - but we always had a lot left over and it just wasn’t worth doing. It might increase turnover but our stockholding was phenomenal. We found that all that Christmas stuff was what people would go out on a day trip to buy, plus we had competition from the local post office which did a good range of stationery.

“Instead, we found that what people really wanted from us was what we supplied them with all year round - what I call ‘all the Bs’ - butter, bog roll, batteries and bin liners. It’s easy to get sidetracked by the tinsel and forget the butter, but we’ve found that sticking to the basics works for us.

“Our customers know we’ll always be in stock of those items and our turnover in Christmas week has gone up every year.”

Gloria adds that the shop does well with confectionery and off licence lines - “that’s because we have some cracking offers, but we don’t stock anything at Christmas that we wouldn’t stock the rest of the year”.
John Inglis, who owns two Spar stores in Southampton, has also limited his festive range. “In our first year in this business we had a vast amount of Christmas stock and it really didn’t do us a lot of good. Nowadays we order the minimum and then top up. We’re right in the city centre and there’s Asda and Woolworths close by - people do what I call their ‘considered’ shopping of Christmas items there first. Then two or three days before Christmas chaos reigns and they will grab things from us.

“We’ve found that Boxing Day is a good day for selling boxes of chocolates - customers buy these for people they’ve forgotten to buy presents for. We’ll major on items on special offer like Ferrero Rocher and keep stocked up with them. Our Christmas ranging and stocking is much more controlled than it used to be and that really works well for us.”

Just as night follows day, then the January sales follow Christmas and Booker Premier marketing manager Richard Cousins reckons this is the time to take stock of your business. “January is a good time to look at all stock and clear out slow selling lines by starting a January sale. Try selling boxed chocolates or alcohol as a multi-buy instead of a price reduction, to pull through the stock as quickly as possible.”

Cousins says retailers should also use the quiet time to check out their rivals to ensure that their store is competitive and that it satisfies local demand. “However, most important of all is to have good availability of the basics such as bread and milk, as when shoppers come into buy these there’s a chance they’ll pick something else up as well.”

Cutting prices - you and the law

The DTI’s code of practice on ‘price indication’ is designed to prevent businesses from giving consumers misleading price information. The requirements are that where the price of an item is reduced, the previous price must be the last price that item was sold at and the item must have been on sale at that price for 28 consecutive days in the previous six months.

However the rules are relaxed for food. Here the code says: “For any food and drink you need not give a positive explanation if the previous price in a comparison has not been applied for 28 consecutive days, provided it was the last price at which the goods were on sale in the previous six months and applied in the same outlet where the reduced price is now being offered.”

When it comes to selling off shorter shelf life food items, retailers need to ensure that they do not sell or display for sale anything that is past its use-by date. Phil Thomas, trading standards manager at Swindon Borough Council, continues: “The items must be kept in the appropriate storage conditions as per the storage instructions and not stored in a way that could make the product deteriorate. If the food has a best before date which has past, then the retailer needs to ensure that the food is still of the quality demanded by the purchaser.

It is an offence to sell food that has lost either its eating quality or is unsafe to eat. The retailer must satisfy themselves that the food is still safe and edible. The use-by date must not be covered up, removed or altered by the retailer.”

Thomas says that some foods lose weight over time
- he gives Christmas puddings as an example. “It is an offence to sell food which weighs less than the weight marked on it. This might be an issue for retailers who sell certain foods past their best-before date.”