Purchase Order Funding and Inventory Finance for Cyber Monday 2017
One day each year ecommerce companies battle it out for their share of Cyber Monday sales. Well, more like 2 weeks prior, one day, and two weeks after… According to Smallbusiness.com “The term “Cyber Monday” was created by marketing companies to persuade people to shop online”(link to original source). Since then each year brings a new technologies, strategies, and sales records.
Of course you have the major retailers that pump millions of dollars into Cyber Monday advertising like Amazon and Walmart. According to Media Life Magazine, “during November, the first half of the holiday season, the top 13 retailers spent $535 million on advertising, including TV, online, radio and print”(link to original source) in 2015. What do you think they spent for 2016? I am curious to find out when the most up to date cyber Monday statistics are released.
So with so much opportunity during the season how can the small and medium sized companies compete for their share of the Cyber Monday madness? We spoke with a few of our Purchase Order Funding and Factoring clients to get a post mortem recap on Cyber Monday 2016 and learn what they are doing to do differently for 2017. That’s right, it’s never too early to start planning.
Increase Inventory – This was the number one comment we heard. Many people felt like Cyber Monday was their major shot to beat 2015 sales numbers. For many of our larger clients there was a huge focus to increase presence on marketplaces. Last year we came out with a Supplier Credit program that can assist our e-commerce clients with purchasing inventory. This service provides our clients the opportunity to stock up on goods leading up to a busy season like the holidays. You can learn more about it HERE.
Focus On A Specific Area – People who tried to spread themselves too thin felt their Cyber Monday ROI was lacking. Most companies have a core competency or a product they are just really good at. This will usually be their product that is in highest demand. While some people use Cyber Monday to introduce new products, many felt this was the time to let their MVPs shine. Stick with the low hanging fruit and use your most popular products to drive in new customers and increase sales.
Start Planning EARLY for Cyber Monday – This applies to planning inventory, marketing dollars, and promotional cadence throughout the year. One marketplace seller felt they were bogged down with slow moving inventory causing a sluggish Cyber Monday. What they should have done was plan on liquidating the slow moving product to bring in more of their most popular sellers for the big day.
As a small or medium sized business it’s quite difficult to stay top of mind during the holiday selling season and Cyber Monday when the majors are pumping millions of dollars into advertising. Pay close attention to your data, test your campaigns thoroughly during the year, and make sure there is working capital left to make a big push for the Cyber Monday selling season.
If you are new at this, it can take a few years to get used to it. Operations, inventory control and marketing campaigns need to be measured, tested, and tweaked before you can get it absolutely right. Financial planning is also a major factor in how successful you can be during the busiest selling season of the year. You can always call your lender to discuss special opportunities and accommodations they can make during the holidays.
If you have questions about Purchase Order Funding, Factoring, or other working capital solutions contact a STAR Funding representative today. For the most up to date information on purchase order funding please take a look at our FAQ. If you are ready to finance your purchase orders, increase inventory, or improve your cash flow we can have you up and running quickly with a customized program to fit your needs.