MAP InsightsColumn in BUSINESSWORLD
Big-business strategies SMEs should adopt for ‘Ber monthswritten by Mr. Benedict Carandang - October 25, 2022
The proliferation of celebrity endorser announcements, holiday-themed digital ads, and promos welcoming September should tell you that big businesses are milking the ‘Ber months for what it’s worth. The ‘Ber months is not only the longest holiday season in the Philippines; it’s also the longest opportunity for local businesses to profit continuously.
While small and medium enterprises (SMEs) do not have the same amount of resources as their bigger counterparts, they have two advantages that big businesses don’t. First, they can be more agile in executing new strategies due to having less decision-makers. Second, SMEs can develop a strong internal team much faster, due to having less employees to develop and empower. Using these advantages to execute the following big-business strategies can help SMEs corner a market, improve their operations, and increase their sales volume this season.
Make peak season preparations as early as now. Advertisers and marketing agencies submit holiday campaign pitches to big brands as early as June. By September 1, business plans for the peak season are set in motion. After the holidays are over, a post-mortem analysis of the ‘Ber month campaigns is conducted, and the learnings reserved for next year’s campaign briefing.
In contrast, many SMEs are unprepared for the holiday season year after year. Some assume their sales volume will naturally increase even if they don’t spend on marketing. Some resort to last-minute promos without adequately preparing their operations. Most do not conduct a post-holiday performance analysis, missing out on insights that can improve next year’s holiday campaign.
So if you are a business owner committed to earning more over the ‘Ber months, you must also commit to preparing as early as now. First, collect operational intelligence from the previous years’ Ber months. What issues were encountered in inventory, delivery and logistics? Which days were the busiest? Which point of sales had the most volume? Which products and/or services did the best and worst? If your competitors performed better than you did, what did they do differently?
From here, set a date to create a holiday business plan, which should combine your learnings with facts from your current day-to-day operations. The plan will ideally answer which of your products and services will be in high demand; your inventory and order capacity; and which parts of your operations will need extra spending.
You may not immediately know how much capital you’ll need, and when it will be needed. In this case, a business credit line will largely help secure your business. This is a type of business loan that lets you borrow from a credit limit whenever the business need arises. As much as possible, find a revolving credit line that is free to set up, has an affordable interest rate, and lets you repay only what you used plus interest without a lot of fees. This will provide you a good emergency fund for cash flow gaps or new business opportunities.
Fix small issues that can hinder operations. Conglomerates and big brands are constantly reviewing internal systems and processes to improve efficiency and eliminate the redundancies that come with rapid growth. SMEs can do the same by reviewing existing systems for inventory, product information, order system, and shipping — in short, your overall end-to-end process.
Stock inventory alone can have lots of issues, such as your online ordering system not accurately reflecting actual items in stock, or items being difficult to find in your warehouse. The most important thing is to know everything you can sell, where they are stored, and how to bring them to the customer in the fastest way possible. Conducting a stress test that replicates your busiest days is the best way to find all these issues. Once you have information, act on developments that can be finished before the increase in demand kicks in.
Train your staff, especially the ones on the ground. Conglomerates take a lot of time in training employees and going over contingency plans, especially on mission-critical days like 11.11 or Christmas Eve. For warehouse, retail, and service staff, training is repeated at least annually. This ensures employee safety and mitigates risks as soon as they’re noticed, preventing a complete shutdown of operations.
In the same vein, SMEs must reiterate their staff’s training during the ‘Ber months. Otherwise, employees might be tempted to take shortcuts, ignore safety rules, or skip the proper approvals to speed up production and delivery.
If you are running ‘Ber month-related events or promos, it’s also best to define a special process on how you’ll fulfill event-related orders. In case of unexpected events, such as calamities or labor shortages, a contingency plan must be in place. Aside from ensuring a smooth customer journey from ordering to after-care service, discussing these plans and processes with staff will also give you valuable feedback on how you can deliver faster or mitigate risks better.
For instance, if you are offering same-day shipping, your sales and marketing team should always communicate the areas covered by this offer. Fulfillment center managers must have a system for figuring out which warehouse can deliver an order the fastest. There must be a system informing customers when their order has been dispatched. Your logistics team must also be trained to communicate well with customers, especially if they need directions or are having trouble with delivery.
Resource poverty may not allow SMEs to operate in the same way as their bigger counterparts during the ‘Ber months. However, there’s a lot to be learned in big brands’ strategies for planning ahead, prioritizing efficiency, preparing for worst-case scenarios, and training staff to ensure safety and a smooth fulfillment process. Once you distill these learnings into smaller-scale strategies for your business, you’ll find it easy not only to increase your revenue during the long holiday season – but to repeat your success year after year.
(This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or MAP. The author is the Vice President for External Relations of First Circle, a fintech provider that helps SMEs grow through long-term partnership, flexible financing, and free tools to help them find government opportunities. This article is co-written with Jess Jacutan, First Circle’s Content Marketing Lead. Feedback at <email@example.com> and < firstname.lastname@example.org>).