Now, retailers must focus on the Christmas holiday season, but we must also look ahead with strategic planning for 2025.

Short-term Preparation for the Holiday Season

Assessing the Cost of Unpreparedness

Consider the potential impact of being underprepared for the holiday season.

• Revenue loss from missed sales opportunities
• Damage to customer relationships due to poor service or stock issues
• Increased stress

For many of our clients, this holiday period represents 30% of their annual revenue. Being unprepared could significantly affect your yearly financial performance and long-term business health.

Technical Readiness

Ensuring all your technical systems function smoothly during the coming holiday period. It includes:

• Check that your Point of Sale (POS) system runs efficiently.
• Confirming that all payment terminals are operational and can handle increased transaction volumes
• Testing barcode scanners and other peripherals for accuracy and speed

How much does anyone want to bet that a few of our clients will contact us in a panic because some POS equipment they never tested is not working?

A technical malfunction during peak shopping times can result in lost sales and customer dissatisfaction, potentially impacting your reputation long-term.

Inventory Management

Proper stock control is critical during the holiday rush. Consider the following:

• Review historical sales data to anticipate demand for popular items
• Ensure adequate stock levels for high-turnover products
• Make sure that your high-turnover products are noticeable.

Staffing Considerations

Adequate staffing is essential to manage increased customer traffic. Key points to address include:

• Assessing the need for additional temporary staff
• Optimising employee schedules to cover peak hours effectively
• Providing thorough training to ensure all staff can handle holiday-specific scenarios

While immediate holiday preparation is crucial, successful retailers must simultaneously lay the groundwork for the coming year. Let's examine how to balance these short-term needs with strategic planning for 2025.

Medium-term Planning for 2025

Current Growth Trends

Recent data shows positive growth in the Australian retail market:

In October 2024, retail sales increased by 0.6% month-on-month, surpassing market expectations of 0.3%

Year-on-year growth in October 2024 was 3.4% compared to the same period in 2023

Embracing Incremental Change

Consider the following strategies to keep your business competitive without overextending resources:

• Evaluating your product mix and potentially introducing new lines
• Refreshing your store layout or visual merchandising to enhance customer experience
• Implementing a simple customer loyalty program to encourage repeat business

These changes don't require significant technological investment but can substantially impact customer engagement and sales.

Customer-Centric Approach

Understanding and responding to customer needs remains crucial. Start by gathering customer feedback through informal conversations and simple surveys. Combine this with sales data analysis to identify trends and customer preferences. Finally, ensure your staff receives training to provide exceptional service that distinguishes you from competitors.

You can make informed decisions about your business direction by staying attuned to your customers' evolving needs.

Take action now

Begin by thoroughly assessing your holiday readiness.

Then, schedule dedicated planning time for your 2025 strategy. Your future success depends on the decisions you make today. Consider a website where you can seamlessly integrate your physical stores with your online website.

Also, I strongly suggest that you look into local SEO. If people cannot find you on the Internet, they will not find you at all.

I am now getting a lot of enquiries about Tower Systems' Sale and what's happening with it. Gossip does not like a vacuum.

The short answer is I don't know, but after being involved in many business sales on both sides, I can make an educated guess.

Here are the facts: Tower Systems announced to its clients and suppliers that it had been sold to Vela Software. It is one big subsidiary of a vast multinational company. 

When I heard this, I was shocked. Rumours had been circulating in the industry that Tower Systems was for sale; I'd been involved in one such negotiation but walked away. 

But it's one of those things where Grandfather is very sick; we know he's very ill, and we're waiting to hear that he's died. But when he dies, it's still a shock. Same issue here - I knew Tower Systems was for sale, but when I heard in October it had happened, I was shocked. Then, we all would be further surprised by the silence.

Vela's Likely Acquisition Process Timeline

Initial market research (1 to 3 months)

Preliminary financial assessment First, informal contacts probably use a business agent appointed by Tower Systems.

Preliminary Engagement (2-4 weeks)

Exchange of NDAs Initial information sharing CIM review First meetings

Initial Evaluation (4-8 weeks)

Analysis of business fit Preliminary valuation Market position assessment Initial offer/expression of interest.

Formal Agreement Stage (4-8 weeks)

Negotiation of terms The signing of a definitive agreement Subject to due diligence conditions Confidentiality maintained

Due Diligence (6-12 weeks)

Comprehensive review process Multiple workstreams: • Financial • Legal • Operational • Technical

I suspect the problem might be here, which is holding up the deal.

Decision Point (2-4 weeks)

Review due diligence findings Final negotiations, if needed Go/no-go decision Possible price adjustments.

Completion and Integration (4-8 weeks)

Final documentation Deal Closing Public announcement Integration begins

So, a typical timeline would be six to nine months.

The Deafening Silence

Now, people are commenting on what's happening and why we're hearing nothing from either Tower Systems or Vela Software. This silence is very unusual. Generally, the buyer and seller make a joint announcement once a sale occurs. There's usually a ceremony, pictures are taken, and a joint public announcement is made.

From what I can see online, Vela's standard acquisition practices include a clear pattern of formal announcements, CEO statements, and continued communication. It's very much in the buyer's interest to notify stakeholders in the company they're buying immediately after the sale about what they intend to do. Customers need reassurance. Suppliers want to know what's going to happen. Staff need to know what to say, and the buyer wants to know what the staff will do after the takeover.

The Tower Systems situation now lacks these hallmarks—no formal announcement, no Vela acknowledgment, and abrupt communication cessation. This isn't typical for Vela Software, which usually maintains transparent communication and formal processes.

This silence is deafening.

Possible Scenarios

Given these unusual circumstances, I have four potential scenarios, some of which are not mutually exclusive.:

1. The Sale is Going Ahead

I propose that Tower Systems' announcement was unauthorised and early in this scenario. Although it was signed, Vela has yet to go through with the sale and is following the path of due diligence. They're still checking. The holiday season has delayed them moving forward immediately.

If so, I suspect we're looking at late January or early February 2025 for the formal announcement.

2. Someone Else Has Made a Competitive Offer

Although unauthorised, Tower System's announcement was an intelligent move to get someone else to act. Maybe there's someone Tower Systems was talking to who wants the company. Vela Software was probably only one of many approaches to buy Tower Systems. Tower Systems is effectively saying that if you wish to have us, you need to act now, or you will lose us. If so, I wonder if we'll hear much until March 2025 as they return to the negotiation. It would also explain Vela Software's silence, as they might be out of the race now.

We're looking, I think, at March 2025 to hear more.

3. Vela Software Rejection

Here, Vela Software said they would buy Tower Systems, but during due diligence, they found something they didn't like and walked away. For this to be true, the sale must have significant issues.

I've heard of this happening many times. I had a client who was going to sell his shop. The stocktakers were counting the day before the transfer. The new owner looked at the value of the existing stock being added up and told the stock-takers to stop as it was too much. He then announced it was far too much stock for what he had been told, and it looked old. The sale was cancelled.

If this is the case, I expect we won't hear anything from anyone.

4. Vela Software Wants a Price Renegotiation

The deal was made. Tower Systems announced it as a done deal. But then, while doing their due diligence, Vela Software found things they didn't like. They're willing to go ahead but want a better price or a change in conditions.

If so, we're looking at a fresh valuation process and negotiations. In this scenario, I wouldn't be surprised if we heard nothing more until March.

Market

Having made the announcement, I feel Tower Systems should say something now. In the meantime, I suggest that anyone doing business with Tower Systems immediately ask for a written statement from Tower Systems stating that the terms of the existing agreement will be honoured for the payment. New guy means new terms and conditions.

While the silence surrounding the Tower Systems sale is unusual, it's not unprecedented in business acquisitions. As we move into the new year, we should see more clarity on the situation. Therefore, don't be surprised if we hear something only in March 2025. After that, I think it's only fair for us to ask questions.

Properly managed loyalty programs are becoming increasingly common in today's retail landscape. Most Australians are members of a loyalty program, and usage is going up.

Understanding Point Expiry Mechanics

Point Expiry in Loyalty Programs: A Smart Strategy for Your Retail Business

You're likely familiar with loyalty programs, you cannot get away from them today. You may have seen their power to keep customers coming back. Today, let's dive into a crucial aspect many small business owners overlook: point expiry.

Why Point Expiry Matters

Point expiry isn't just about managing your books, although it helps there as large numbers of unused points can be financially troubling, as some of my clients have found out.  It is a powerful tool for driving customer engagement. Customers are much more motivated by the possibility of losing their rewards than they are by the possibility of gaining new ones. This psychological trigger can significantly boost your program's effectiveness.

Setting Up Your Expiry System

Choose the Right Timeframe The sweet spot for most Australian retailers is 12 to 24 months. This gives your customers ample time to earn and redeem points while keeping your program manageable. We tend to recommend 12 months. 

Clear Communication: Your POS system should automatically track point balances and send timely reminders about expiring points. Your POS System makes this process seamless, as it handles everything from:

• Point balance tracking
• Automated expiry notifications
• Redemption monitoring

Making It Work for Your Business

Clever Program Design: Your loyalty program should offer multiple redemption options to prevent point hoarding. Consider including:

• Essential rewards that are easily attainable
• Premium rewards for higher spenders
• People love charitable donation options for unused points; remember to select a few non-partisan charities they can pick from. 

Managing Customer Expectations

The key to success is transparency. Your POS system should provide clear visibility of:

• Current point balances
• Upcoming expiry dates
• Available redemption options

Measuring Success

Your POS analytics should track crucial metrics like:

• Redemption rates
• Customer engagement levels
• Revenue impact

Remember, a well-managed point expiry system isn't about taking away value from your customers - it's about creating a dynamic program that keeps them engaged and returning to your store.

Want to learn how a modern POS system can help you manage your loyalty program more effectively? Let's chat about finding the right solution for your business.

World Wide Web Day is when the World Wide Web started 35 years ago.

In just 35 years, the internet has revolutionised retail, driving business digital transformation at an unprecedented pace. It has reshaped how businesses operate in an increasingly digital world.

The Evolution of POS Software

Its been remarkable. The days of cumbersome cash registers and tedious manual entry are behind us. The internet's influential role has reshaped the operations and customer experience for local businesses.

• Local shops now need an online presence for small retailers
• Access to e-commerce platforms
• Social media to improve customer engagement
• The fax and much of the mail have practically gone
• Digital receipts

Digital Payment Solutions

Today, most payments, such as EFTPOS and credit cards, are made online. We at POS Solutions were the first software company to introduce this to Australia. https://www.possolutions.com.au/pages/tyro-payments.

Retail in the Internet Era

E-commerce has created new revenue streams and broadened customer access for small businesses. The COVID-19 crisis accelerated this trend.

Today embracing the power of data, including CRM and analytics, has emerged as a game-changing strategy for local retailers.

Customer relationship management (CRM) tools have become indispensable for small retailers. These systems allow businesses to:

• Track customer preferences and purchase history
• Personalise marketing efforts
• Improve customer service

The main reason this works today is that, with email and internet newsletters, businesses can communicate effectively for free with their customers. Before the internet, this was very expensive and only available to large companies.

Local Business Marketing Online: A Game-Changer

Local business marketing online has revolutionised how local retailers attract and retain customers. Strategies like local SEO, social media marketing, and targeted online advertising need to be looked at  to compete effectively.

Conclusion: Embracing the Digital Future

The internet has undoubtedly transformed retail.

There is no going back. 

The Australian retail landscape is in flux; we all know that what is essential with these studies is not just what they say but also what others, for example, banks that control the finances and prospective buyers and their accountants, are being told. These people control the inflow of money.

What we do know is that retailers face obstacles.

- We have a rising cost of living

- We have significant supply chain challenges

- Shifting consumer preferences

As everywhere, only those who are willing to adapt and evolve do well.

Let's dissect some critical insights from Roy Morgan's recent retail address and a lively discussion between retail experts Laura Deasi and Paul Zara, CEO of the Australian Retailers Association.

Key Takeaways from the Roy Morgan Address

• Population growth is vital: Australia's growing population has been a lifeline, somewhat shielding us from a full-blown recession. These people have been a big help to retailers.
• The cost-of-living bites: Rising costs disproportionately affect young families with children. However, some sectors and demographics still have spending power. The traditional pattern in such circumstances is that men's products go down, followed by kids' and women's products.
• Changing spending patterns: Consumers are reducing spending in some categories but increasing in others. There's a surge of interest in bargain hunting and sustainable options.

The Rise of Online Giants

• Amazon's Dominance: Amazon is rapidly expanding its customer base and is now one of Australia's top five non-food retailers. Their vast stock and focus on fast delivery pose a significant challenge to brick-and-mortar retailers.
• Ultra-Cheap Challengers: Shein and Temu have entered the scene with rock-bottom prices. However, concerns about quality and ethics may turn some consumers away in the long run.

What Does This Mean for Aussie Retailers?

Paul Zara and Laura Deasi offered valuable advice and considerations:

• Value is the New Currency: Price matters more than ever, but it's not just about the cheapest deal. Emphasise quality, durability, and your product's long-term benefits.
• The Ethics Factor: Consumers are increasingly conscious of your company's ethics. My advice still applies: Do not fall into this trap as whatever you do many will not like it.
• Online presence: I do not know how or why anyone would want to escape without an online presence.  Offer something and have "click-and-collect" options. A modern and robust online presence is essential for meeting the expectations of today's shoppers.
• Tech to the Rescue: Your point-of-sale (POS) system can be your best ally.
  • Streamline operations: Automate tasks to reduce overhead and free up time for customer service.
  • Personalise experiences: Use our CRM features to provide recommendations and targeted promotions.
  • Data-driven decisions: Track sales patterns and inventory levels to optimize your offerings and minimise waste.

Your Competitive Edge: The Human Element

Retail has always been a people-powered industry. While tech upgrades are vital, the exceptional in-store experience remains a decisive advantage for brick-and-mortar stores:

• Become an expert: Offer valuable product knowledge and tailored recommendations that online giants can't replicate. Coles has even little things like greeting cards, but I will not get any advice there on the sort of card I need.
• Build relationships: Friendly, personalised service creates loyal customers who become your advocates.
• Community connections: As Paul Zara emphasizes, physical stores are the heart of local communities. Support community causes to show that your values extend beyond sales.

The Future of Retail – Adapt and Thrive

The retail landscape is constantly evolving. Businesses with the foresight to adapt have a chance to excel:

• Embrace innovation: New technologies can transform your operations.
• Test and learn: Experiment with new products, displays, and promotions. If they work, double down. If they fail, be ruthless and get rid of them. Do not reinforce a defeat.
• Partnerships matter: Collaborate with as many people as you can.

To do well in 2024, we need to focus. 

Share your thoughts in the comments below!

Australian retail turnover rose 2.0 per cent (seasonally adjusted) in November 2023, according to figures released today by the Australian Bureau of Statistics (ABS).

Robert Ewing, ABS head of business statistics, said: "Black Friday sales were again a big hit this year, with retailers starting promotional periods earlier and running them for longer, compared to previous years.

“The strong rise suggests that consumers held back on discretionary spending in October to take advantage of discounts in November. Shoppers may have also brought forward some Christmas spending that would usually happen in December." 

Okay, accepting that the latest retail sales number did show a robust 2% monthly growth, but it may be distorted by the increasing popularity of Black Friday sales in November. More about that later. 

One bit of good news is that this shows that consumers are still spending despite higher interest rates. Our strong job market certainly helps this. We will need to see the December figures to see whether it's simply that consumers are spending more or that all they are doing is bringing forward their purchases from December to November.

Black Friday sales impact on Australian retail

Black Friday sales have become an increasingly prominent retail event in Australia over the past decade. Originally from the US, it has evolved into a much larger affair in Australia. Black Friday has become mainstream in the past ten years, changing to a "Black November" event in Australia. Rather than just a day,  retailers now run week-long or even month-long sales promoted under the Black Friday banner. See this graph for the past ten years of November growth.

The future of Black Friday in Australia

Black Friday will remain a prominent retail event in Australia, especially as more consumers become conditioned to expect big sales in late November. Retailers should continue to expand Black Friday promotions to maximise sales. Today, many shops open on the Black Friday public holiday to capitalise on foot traffic.