By Sandra McGinty
  
For pet products retailers, the holidays bring a boost to their bottom line, but once the season’s over, how do they manage excess inventory?
  
According to Susie Atherton, owner of Canine Creek Dog Wash and Boutique in Tehachapi, Calif., ordering right is a great first step in reducing excess holiday inventory.
  
“We minimize holiday inventory rather than deal with leftovers,” Atherton says. “Our philosophy is competitive pricing year-round; we rarely have leftovers. We use a five-step process. First, we order early to take advantage of pre-season vendor discounts. Next, we price competitively, passing on vendor specials to our customers. We then display holiday merchandise early in the season and rotate displays mid-season to keep them looking fresh. Next, we use decorations throughout the store, such as bows and garlands, for a holiday feel. And we stock less than we believe will sell. Our system works. Last year’s leftovers consisted of a handful of stockings and reindeer plush that we packed away in one small box.”
  

“Our philosophy is competitive pricing year-round; we rarely have leftovers.”                 —Susie Atherton,                      Canine Creek Dog                          Wash and Boutique

Cynthia Waldenmaier, owner of Hyde Bark in Cincinnati, says that if items are left over, there’s a reason.
  
“From my former life as a department store manager, I learned that if an item doesn’t sell, it’s due to how it is displayed,  its price point or it’s just a bad item,” Waldenmaier says.
  
Hold Limited Sales
Kathy Ahearn, owner of Four Your Paws Only in North Conway, N.H., says keeping a handle on ordering is a good way to stay ahead of the end-of-year sales game.
  
“We have learned over the years how to manage our holiday inventory,” Ahearn explains. “We don’t take special orders or order gift items after Dec. 1, unless it’s paid for ahead of time and we know we can get it in quickly for a customer. As for holiday items, we generally sell what we have after Dec. 1.”
  
Waldenmaier agrees about ordering.
  
“Retailers need to be precise in ordering,” she says. “Our computer system tracks information like color and sizes of items, so we have more to go by than just a SKU number and order accordingly. Sometimes we do special orders on ‘wow’ items for which we know we have specific buyers. Then we call them and let them know we purchased the items with them in mind. These are usually our high-end buyers.”
  
Waldenmaier adds that she doesn’t usually have much end-of-year inventory.
  
“We wait till after Christmas and mark down any leftovers,” she says. “We normally don’t have sales. Our customers know if they see something at a discounted price, they’d better buy right then and there. Usually, we only have enough leftovers to fit on a 36-inch round table, and they go quickly.”
  

Move Things Around “Retailers should move their holiday displays constantly, and always keep a fresh look,” says Cynthia Waldenmaier of Hyde Bark in Cincinnati. “We move displays four to six times throughout any holiday season. Also, a lot of items we have are not high-dollar items. We boost holiday sales via merchandising tactics, like sprinkling them throughout the store even before Halloween. A lot of people take pictures early for the holidays, and need to buy outfits for their pets early.”

Ahearn has one blowout, end-of-the-year sale.
  
“We are in a resort area,” she says. “We have customers here on vacation after the holidays. It’s a great time for us to put all leftovers on sale and move any other merchandise that hasn’t been selling before our end-of-year inventory counts.”
  
Alyce Duffy, owner of Whiskazz and Pawzz in Hockessin, Del., says she also hosts a once-a-year sale.
  
“Every year, I have a Big Brown Bag Sale the day after Christmas,” Duffy says. “It continues for two days. Everything in the shop goes on sale for 50 percent off. Customers are given a big brown shopping bag and told that whatever they can fit into it is 50 percent off. It’s been a resounding success for us!”
  
Duffy says there are still always going to be a few leftovers to deal with.
  
“We usually put unsold ornaments away for next year,” she says. “Dog clothing can be sold throughout the winter months. We change our point-of-sale displays to promote the items differently. We repackage treats with a winter theme, then a Valentine’s theme. Other items can be sold throughout the year. For items that just aren’t moving, I may sell on eBay at reduced prices.”
  
Think Creatively
Retailers have to think ahead when it comes to holiday ordering and sales, says Ahearn.
  
“We have a rough idea of how much we’ll sell and start putting items on sale ahead of time,” she explains. “For instance, if we place the item on sale at 15 percent off the week before Christmas, people will most likely purchase it because they get it on sale. It is better than waiting to see if they’ll buy it and then if not, it goes on sale at 50 percent off. This tactic has really cut down on leftovers after the holidays, and we make more of a profit. We have gotten stuck with holiday overstock before and find nobody likes to buy holiday-specific items after the holiday.”
  
She adds that not everything is going to sell.
  
“If there is still anything leftover, we’ll either donate it to the local animal shelter or put it away for next year,” Ahearn says.
  
Differentiation is key in cutting down excess inventory, Duffy says.
  
“We offer a lot of custom items and have made an investment in an embroidery machine, which lets us produce items on an as-needed basis to cut down on holiday leftovers,” she says. “We are able to offer unique merchandise that customers can’t find at the big chain pet stores or even other specialty boutiques.”
  
Posted: Dec. 20, 2006