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The prospect of tariffs from 10% to 60% being imposed on goods from Canada, Mexico, China, and other countries by the incoming Trump Administration is certainly contributing to headlines and attention. Another flexibility test for retailers.
Some retailers have seized on the uncertainty that has resulted. They are using the fear of tariff costs leading to higher retail prices to heighten the shoppers' sense of urgency.
"Companies are pouncing at a moment when fear and uncertainty are on the rise and consumer spending is showing signs of weakness," reported The Wall Street Journal.*
Social media provides a ready platform for spreading the fear of potentially higher prices:
"Pre-Tariff Sale! Order now before prices double."
"Lock in our current prices now!"
“The very same items you are seeing now will be double the price once the tariffs kick in."
Meanwhile, others on social media are feeding into the tariff frenzy by urging people to buy their favorite products in bulk now. Some TikTok influencers are offering stockpiling guidelines on how long everyday items like makeup and shampoos can be stored.
Whether or not tariffs will be imposed, and at what rates, and when is very uncertain. And if imposed, how long they might remain in place is likely to be short-lived, according to some.
In the meantime, urging customers to buy more now to save later is, of course, a time-honored sales technique. And there’s nothing wrong with that.
So, this just may be the time to unleash your inner merchant!
Heighten the sense of urgency for your shoppers. Use the spectre ("veiled threat") of much higher prices looming after January 20 to...
Close more and larger sales now.
Hold prices longer in December. ("These prices will be like a big discount come January, February...")
And importantly, adjust – that is, reduce – your buying plans for 2025! (Your shoppers will be working their way through their stockpiles, remember?)
In retail especially, change IS the name of the game. Adjusting to uncertainty is an everyday flexibility test for retailers.
As one owner's email to all employees noted, "I don't think this will be the last curveball thrown in our direction."
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* "Retailers Play Up Tariff Fears To Lure Reluctant Shoppers." Suzanne Vranica, The Wall Street Journal, November 29, 2024.
* "New Tariffs Concern Some Small Firms." Ruth Simon, The Wall Street Journal, December 2, 2024.
Without a doubt, these continue to be unprecedented times for managing a retail business. The Disruption with a capital D continues, from the pandemic to supply chain challenges, employee issues, worldwide inflation, interest rate increases, etc. And now, the global economy is in more turmoil due to the Ukraine invasion and the resulting sanctions against Russia. Lots of challenges for business owners as they wrestle with rising costs, aren't there? But for independent retailers, there exists one glorious opportunity: price elasticity. Yes, raising prices. A whole new ball game for many independent retailers.
No, Not About People This Time While we typically think of people as recipients of recognition – and we trust you already are doing that, right? – this is a different challenge. Ready? Here we go! Of your merchandise, which products are Award Winners?!
Amidst the fog of uncertainty of 2020, retailers have experienced a breath-taking acceleration of time, as an array of new-to-retailers technologies have now become almost commonplace. 2020 has put an end to the days of retailers being technology laggards. We applaud the resilience and adaptability of retailers who did embrace change and especially technology during 2020. Retailers definitely rose to the occasion! And yet, again, the virus is surging. Even as promising announcements are made about vaccines, the threat that COVID-19 continues to pose to the survival of local businesses is ominous, and substantial. We agree! This is so not fair! But, who is up to that challenge? Independent retailers who are merchants supreme.
Let's assume your stores have been closed for weeks now.
We recognize how conscientious you are. So, after paying what you can to your employees (and yourself), the next most-worrisome dilemma is your rent.
As you likely have discovered, a common choice for many landlords is to offer to defer your payments. But that means taking on more debt, as those payments are only being postponed to a later point in time. You need a better solution than that.
As your stores are able to re-open after the coronavirus shutdowns, how they look tells a powerful story. And for you, a great opportunity. This is no time to try to go back to normal, back to business-as-usual. Nor to simply have all kinds of protective shields in your store. While necessary, how welcoming is that? Instead, this actually IS a second chance to make a good first impression! Take full advantage!
There's a very important annual job for you, the owner, and all of your senior staff. It's vital, and it involves your presence. The pressures are mounting on your stores, and in particular, your front line staff.
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