Small businesses can feel shut out of the 4-day shopping frenzy of Black Friday, but there are ways to tap into the spending spree.
Research by the Australian Retailers Association reveals Aussie shoppers are tipped to spend $6.36 billion across the Black Friday/Cyber Monday weekend spanning November 24 – 27. It is expected many Aussie shoppers will use the sales extravaganza to purchase gifts for Christmas.
However, many small retailers are likely to miss out on cash splash.
A survey by OnDeck found only 10% of all small businesses surveyed engage in Black Friday, and fewer than one in three (32%) small retailers will take part in the Black Friday sales#.
Why don’t more small retailers tap into Black Friday?
OnDeck CEO Cameron Poolman, says there are two key reasons why many small retailers can feel locked out of Black Friday.
1.It’s hard to match the discounts of big-name retailers
“The big brands have tremendous buying power,” explains Cameron. “They not only buy in huge volumes, which reduces per unit inventory costs, they also use their buying power to negotiate additional supplier discounts.”
Cameron adds that while small businesses can’t always match the discounts – and remain profitable, there is a possible solution small retailers can use to keep up.
“Small retailers may be able to secure discounted trading stock by offering faster or upfront payment terms to their suppliers,” says Cameron. “Accessing funds quickly, such as through OnDeck’s Lightning Loans® can give small business retailers the cashflow needed to leverage discounts or special offers from suppliers allowing them to make upfront payments.”
2.Small businesses don’t have the marketing clout of national chains
Head online and it’s almost impossible to escape the upcoming Black Friday sales. Chances are, your screen is clogged with banner ads and pop-ups spruiking the big brands’ upcoming Black Friday super-savings.
In this sense, it can be hard for small retailers to compete. But Cameron believes small retailers can take advantage of low cost strategies to entice customers into their stores.
“It can cost next to nothing to promote a sale through the clever use of social media, and by utilising your customer database,” explains Cameron. “Small retailers also have the advantage of much more intimate knowledge of their customers, allowing for very tailored marketing.
Commercial funding can allow a small business to engage marketing experts and develop a bespoke marketing strategy. It can be money well spent for those business owners who are unsure how to successfully market their enterprise at this time of year.”
One step that could make a noteworthy difference
Like it or loathe it, Black Friday is here to stay.
Research from strategic insights consultancy Nature, shows 93% of consumers are aware of the sales event, and it found anticipated spending levels for Black Friday are “significantly higher than the traditionally revered Boxing Day sales”.
The clincher is that online retail plays a pivotal role. Nature reports that a significant percentage of consumers are likely to make their Black Friday purchases online.
“This makes it critical for small retailers engaging in Black Friday to offer a seamless user experience and website accessibility,” notes Cameron.
He adds, “This can call for an investment to upgrade an enterprise’s IT capabilities. Specialist small business lending can be the key that opens the door for a retailer to get on board with an event that 10 million Australians are expected to engage with in 2023, an increase of 14% on 2022.”
Lightning Loans® – fast funding to cash in on Black Friday
As a dedicated small business lender, OnDeck’s Lightning Loans® provide fast, efficient finance for small retailers.
Lightning Loans® are available for up to $175,000, with the money in your account in as fast as two hours^.
“OnDeck can provide the funding to improve your venture’s IT capabilities, increase marketing muscle and boost stock purchasing power to compete with the big names and enjoy your slice of Black Friday spending,” says Cameron.
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