The holiday season is often referred to as the season of giving but for retailers, it truly is the season of selling. In 2012 over 720,000 seasonal workers were hired as the holiday season accounts for between 20 and 40 percent of a retailer’s annual income. For the high-risk high-reward merchant entrepreneur, the holidays are the golden ticket and pay-out for your investment. Knowing the forecasts and sales projections is a pivotal part of high-risk market research.
Marginal Retail Sales Growth Expected
The National Retail Federation reported a marginal sales increase in 2012 of 3.5% for retailers. The projection for the 2013 holiday season is projected at 3.9%, an increase of .4%, marking a tepid growth at best. The primary cause for restraint on the part of consumers comes from the uncertainty and lack of stability regarding the debt ceiling in Washington. The uncertainty in Washington casts a shadow over traditional sales variables such as consumer confidence, disposable income, and consumer credit ratings. Signs of optimism do show through the uncertainty with an increase in consumer demand for larger-ticket items this holiday season.
E-Commerce Booming
A major trend from 2012 that is expected to carry on through 2013 is the booming growth in online sales. The final financial quarter of 2012 saw e-commerce sales increase by 15.5% reflecting the new online favoring consumer base. Bargain shoppers go online to find the best rates for their transactions. Access to peer reviews and the ability to buy from home and then pick-up in store contribute to the marked growth in e-commerce. Additionally, the mobile app industry creates thousands of apps yearly to help holiday shoppers do their gift-hunting online. Online sales, according to shop.org, are expected to once again grow between 13-15%.
Implications for High-Risk Merchants
Considerable growth potential in e-commerce indicates that for high-risk merchants online vendors may be the highest profit potential during the holiday season. Investing in an online, high-risk business may not be attractive to conservative banks for opening merchant accounts allowing for high-risk merchants to use services such as emerchantrboker.com to open merchant accounts for their new businesses. Emerchantbroker.com itself offers eight merchant specialty accounts specifically designed for online, high-risk businesses. Additionally, most retail services that are not specifically online can be adapted to have an online vendor feature.
A classic example of a high-risk online merchant is one specializing in e-cigarettes, vaporizers, and other smoking accessories. States such as Iowa and Pennsylvania laws restrict what they deem as ‘drug paraphernalia’ and force shoppers looking for vaporizers and other items to look online to purchase an item in a neighboring state. A merchant operating in this market niche can utilize a specialty merchant account from emerchantbroker.com to help kick start their high-risk online business to cash in on the growth in profit potential during the holidays.
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