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Take On 2022 With Confidence

Take On 2022 With Confidence

You made it through another holiday season. Congratulations! Now it’s time to prepare your business for 2022 using Lightspeed Retail tools.

Where do you want to focus in 2022? 

  • Build a strong foundation.
    So you want a budget that takes the nuanced realities of your business into account, and you want an actionable plan for sales and loyalty. You’ll need data to know where you should focus, and you’ll need the right tools to act on your findings. Jump to section
  • Boost sales.
    Make sure you have mobile payments, add shopper favorites to your brick and mortar location and make sure your employees are happy. This goal helps you meet customer expectations in 2022. Jump to section
  • Counter supply chain delays.
    Ah, supply chain delays—they’re not getting easier until summer at the earliest. Luckily, if you’re proactive, you can set yourself up for success. Avoid empty shelves and unpopular stock with an air-tight inventory management strategy. Jump to section
  • Make your bookkeeping more efficient.
    Sure, it’s a straightforward goal. But if you’re losing hours tracking sales and examining your numbers, it’s a foundational one—and the solution is simple. Jump to section

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How to build a strong foundation

Get data for budget planning

Beyond your total sales and revenue, use Lightspeed to get more in-depth data points about your performance, such as:

  • Sales over time: run this report from your Lightspeed Retail account to get a big-picture view of your business so you know what should be replicated in 2022. Take a note of what months had stronger sales and make sure you budget for whatever was working to happen again.
    Head to Reports > Sales Over Time, set the date range from January 2, 2021 to December 31, 2021 and group the results by month.
  • Profit year over year: this is a Lightspeed Analytics report that helps you place 2021 in the wider context of your business. The results take expenses (salaries, purchases), fees or overhead (rent, bills) and taxes into account, giving you a picture of what you have to reinvest into your business in 2022.
  • Customer lifetime value: this is a Lightspeed Analytics report. Once you have this number, you can pinpoint if you need to invest more in customer loyalty to up the lifetime value of repeat customers.
    To run these reports, open Lightspeed Analytics, click the reports tab and search for the reports by name. Hit the star to save them for easy reference in the future.

Invest in your business

With your data in hand and your budget made, here are two key areas of focus you should be considering.

First, take a look at your eCommerce site. Does it need a new theme or a layout update to freshen it up for the new year? Head to the Lightspeed eCommerce theme store to browse for a new theme. We recommend Ignite.

Next, take a look at how you’re handling loyalty. With your customer lifetime value report results in hand, what do you need to focus on?

  • If the average lifetime value is lower than you’d like, consider launching a Lightspeed Loyalty program if you don’t have one already. 

  • If you already have a loyalty program, go back to your sales over time report results. Still want to boost your numbers? Put an emphasis on your employees signing shoppers up, and go over your rewards to see if you can make them more enticing.

Loyalty program members contribute nearly half of companies’ annual sales, and 95% of companies with a loyalty program say members spend more than non-members.

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Make a plan to increase in-store traffic

While we don’t know what 2022 will bring for lockdowns, whenever it’s safe to receive shoppers, you’ll want to be prepared with a plan to catch eyes and bring traffic to your store. 

Did you know that over half of shoppers participate in showrooming (seeing an item in person before buying it online)? In-store traffic is crucial to the buying process online and off.

  • Help new shoppers find your store. You can use local inventory ads to catch the attention of shoppers looking for items you carry on Google.
    Local inventory ads can be managed from Lightspeed Retail. Head to the Marketing tab to get started, or watch a guide here.
  • Encourage existing customers to come back to your store. Since increasing customer retention rates by 5% increases profits by at least 25%, you’ll want to be sure you’re reminding shoppers to come back often.
    In Lightspeed Loyalty, set up a Time Away campaign to entice loyalty program members to come back and shop if they’ve not visited in a while.

How to counter supply chain delays

Plan your inventory counts

They’re not the most exciting part of running a retail business, but they need to get done.

Pick your strategy for the year:

  • Full inventory counts. While this will get your entire inventory counted for a fresh start for the year, it’s time consuming, and often requires closing the shop. You should perform at least one, however. 
  • A rolling inventory count. Also known as a cycle count, in this method you regularly count a rolling selection of your inventory. You can do these throughout the year to avoid needing to do multiple full counts. 

Use the Inventory Count feature in Lightspeed Retail, and make sure you reconcile your inventory when you’re done.

Decide what to do with old inventory left over from 2021

Dead stock weighs you down. Don’t bring it into 2022—get rid of it. 

In Lightspeed Analytics, head to the reports tab and search for the Dusty Inventory report. This will identify stock that hasn’t sold at all recently.

With your dead stock identified, you can make a plan to get it off your shelves. Three possible routes are:

  • Donate it to charity. Donations from inventory are potentially tax deductible (check with your accountant).
  • Set heavy discounts. You could make one last attempt to move the inventory yourself through a good deal.
    In Lightspeed Retail, head to Settings > Price & Discount Rules to set BOGO or quantity discounts.
  • Sell it to a liquidator. If nothing else, selling your inventory to a liquidator is better than trashing it.

Order new inventory for 2022

Unfortunately, it seems 2021’s supply chain struggles are going to continue into at least the first half of 2022.

“We should not expect the environment of higher prices and lower product availability to go away at the end of the year,” said Tom Kelly, instructor of integrated supply management at Western Michigan University’s Haworth College of Business. “For 2022, businesses and their supply chains are going to need to take a very close look at their logistics and planning functions.”

You can get ahead of some of the struggle with a proactive inventory ordering plan, powered by your Lightspeed system.

  • Run a low stock alerts report. This Lightspeed Analytics report will tell you what goods are low in stock and how long until they sell out. This will help you prioritize purchase orders. Set a schedule to run it throughout the year to see if anything is going low on stock before you’d expect it to.
    You know the drill: search for Low Stock Alerts in the reports section of Lightspeed Analytics to run this report.

  • Run a sales by category report. Run this Lightspeed Retail report to check the popularity of inventory at a category level. You can prioritize ordering inventory from categories making higher sales.
    Find this report in Retail in the reports section.
  • Set your reorder points higher. You may need to reorder inventory sooner to account for longer shipping times. Setting your reorder points higher will help you plan for that.
    When managing your inventory, increase your Automatic Re-Order Points levels on items with longer shipping times. Run the Reorder List report in Lightspeed Retail regularly to identify inventory to be ordered.

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How to boost sales

Add customer favorites for smoother sales

Shoppers expect you to have an ecommerce store, and the relatively slow month of January is the perfect time to get started. With Lightspeed eCommerce, you can sync your Retail inventory and speed up some of the setup. 

Likewise, take a look at your payments setup and make a plan to upgrade if needed. Integrating certain payment processing services into your setup means you can offer a quicker, more secure checkout with less chance of human error. 

If you already have integrated payments, make sure you’re truly contactless and mobile. Lightspeed Payments users can add wireless, mobile hardware to get their setup ready for 2022. 

Only 58% of small businesses use contactless payments. Independent retailers can get ahead of the competition by implementing contactless mobile payments—a customer favorite—now.

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Keep on top of your employee performance and development 

Without a solid group of employees, you might need to cut hours and lose out on sales. 

Get ahead of the labor crisis by making your store a great place to work. Beyond higher pay, add these steps to your to-do list:

  • Start tracking and rewarding employee performance with data. Let your highest performing employees know they’re valued.
    In Lightspeed Analytics, click the reports tab and search for the Individual Performance report.
  • Plan out career development goals. Make plans to sit down with employees every quarter to map out what they want from their job and where they want to go. This will demonstrate that you’re invested in their future at your business.

Half of employees in a recent survey said their places of work were understaffed. Making your store a rewarding place to work will help you attract new staff to guard against burnout.

Make the measures you’re taking to value your employees known when hiring so you’re a competitive place to work. 

Make your store exciting to visit in 2022

After sprucing up your eCommerce store, what about your brick and mortar? Why should shoppers visit you in person in 2022?

43% of shoppers think that offerings like shopping assistants and personalized product recommendations are nice to have now, but they also say they’ll come to expect them soon. Appointment shopping can help you meet that need.

To make your store enticing, you could make a plan to offer:

  • Appointment shopping. Whether you’re a clothing or footwear retailer offering personal styling services or a musical instrument retailer booking piano tests, appointment shopping gives customers a reason to come in store and get personalized service.
    You can add shop by appointment to your Retail account to manage appointments from your POS system. 
  • Services and repairs. Depending on what it is you sell, you could offer repairs and alterations (such as bike repairs), or services like wine tastings or makeup demonstrations. These give shoppers a reason to come in store even if they’re not looking to buy products.
    Use Lightspeed Retail’s work order function to track repairs. For services, consider enabling tipping in Retail to reward your employees.
  • Subscription services. Subscription boxes are great–but subscriptions can work for non-tangible goods and rewards as well. You could offer shoppers subscriptions to cooking lessons, or to a savings club.
    You can manage subscriptions through Lightspeed Payments. Your account manager can walk you through the process.

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How to make your bookkeeping more efficient

Get your accounting software set up

You’ve got a busy year coming up. Connecting your accounting software to your POS system through an integration like Lightspeed Accounting will save you time by automatically synchronizing your bookkeeping information between the two. 

It’s a simple step, but an invaluable one that saves you (and your accountant) business management hours.

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Get a head start on your taxes

Your professional income tax return is due March or April, depending on your business type (or potentially in June, for some Canadian businesses. Check with your accountant). While you have a minute, get a head start on arranging what you need to file.

To get your numbers for 2021, you can run a report on your totals (that also includes your cost of goods sold, margin and sales taxes) through Lightspeed Retail

Head to Reports and run the Totals report. Make sure you set the date range from January 1, 2021 to December 31, 2021. 

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More of this topic: Management & Operations