As the financial year draws to a close in Australia, retailers and e-commerce sellers can use this time to optimise operations and strategically clear existing stock and old inventory. By analysing existing inventory and strategic discounts and pricing, sellers see profits by attracting high-intent value-seeking buyers at this time of the year.
According to a study by Roy Morgan, 83% of Australian consumers who plan on purchasing during the end-of-financial year sale plan on spending the same or more than they spent last year. The average consumer spending during the sale was around AUD 1450.
This is a great opportunity for e-commerce sellers to make use of seasonality, upcoming inventory replacement runs, and inventory clearance to boost their sales. However, a sales day this prominent requires efficient planning, mostly weeks in advance.
To help Aussie sellers like you, we have compiled the best practices, things you should factor in as you prepare for the end of year sales day. Let’s jump in!
What Is The Eofy Sale?
The EOFY sale coincides with the close of the Australian financial year on June 30th, with around 51% of Australian consumers planning to purchase online during the sale. Businesses use this period as an opportunity to clear out stock and potentially claim tax deductions on unsold inventory. This, in turn, translates to significant discounts for consumers across a wide range of products, from electronics and appliances to fashion and furniture.
Why is the EOFY Sale Important for Australian Consumers?
For consumers, the EOFY sale presents a prime opportunity to snag major bargains on desired items. During EOFY sales, men are known to spend higher than women, with average purchases being AUD 1,778 compared to AUD 958 for women.
The target audience for the sale are millennials with over 43.8% of them shopping during the sales day with the top category being Apparel and Accessories. Additionally, 26.3% of Gen Z and 22.9% of Gen X consumers spend on EOFY Sales day on the best deals.
The 2022 year-end sales saw inflation impacting consumer spending, but tech essentials and health products remained in high demand. Retailers offered deep discounts to clear out stock, with highlights like Amazon’s year-end sale boasting nearly 80% off on select items.
Fast forward to 2023, eco-conscious consumers fueled a rise in sustainable product purchases during year-end sales. Subscription boxes also gained traction, offering convenience and catering to diverse interests. Value for money remained a priority as Filipinos navigated rising inflation. Online platforms like Shopee continued to be a popular destination for year-end deals, with electronics and beauty products experiencing a surge in sales.
However, the sales day holds great importance to all AUstralian consumers. Here’s why it’s a significant event:
- Deep Discounts: Retailers offer some of their most competitive prices of the year during the EOFY sale. This allows budget-conscious consumers to stretch their spending power and potentially afford otherwise pricy items.
- Wide Selection: The EOFY sale encompasses a vast array of product categories, making it a one-stop shop for diverse shopping needs. Whether it’s a new TV for the living room, a wardrobe refresh, or a long-awaited gadget, there’s a high chance of finding it at a discounted price during this period The top selling category includes pet products.
- Tax Time Savings: The EOFY coincides with tax time in Australia. For some consumers, EOFY sales can be a strategic time to make high-value purchases that might be eligible for tax deductions, further increasing the cost savings.
How Can Australian Sellers Benefit from the EOFY Sale?
The EOFY sale isn’t just about discounts for consumers; it’s a strategic opportunity for Australian sellers to boost sales and clear inventory. Here are some key benefits for sellers:
- Increased Sales Volume: The concept of discounts attracts a surge in consumer spending during the EOFY sale. This translates to a potential rise in sales volume for sellers who participate in the sale.
- Inventory Clearance: The EOFY sale provides an excellent platform to clear out slow-moving stock or seasonal inventory before the new financial year begins. This frees up space for fresh products and improves overall inventory management.
- Increased Brand Awareness: By participating in the EOFY sale, Australian sellers can gain greater visibility and attract new customers who might not have otherwise considered their brand.
- Competitive Advantage: Offering competitive discounts and promotions during the EOFY sale can help sellers stand out in a crowded marketplace and attract customers who are actively shopping for deals.
Why Does Planning Ahead Matter?
Imagine navigating the EOFY sale blindfolded. You wouldn’t know what products to discount, how much inventory to stock, or how to handle the inevitable surge in orders. Planning ahead helps eliminate this issue, ensuring you stay a step ahead of the competition.
1. Forecasting Demand: By analysing past sales data and tapping into seasonal trends (for eg: winter clothing sales in June), you can predict which products will fly off the shelves during the EOFY sale. This allows you to pre-order sufficient stock of popular items, avoiding the dreaded “out-of-stock” label that frustrates shoppers and hinders sales.
2. Streamlined Operations: Anticipating demand fluctuations allows you to prepare your fulfilment infrastructure. You can secure temporary staffing or partner with a reliable 3PL provider in Australia to handle the increased order volume. This ensures you can fulfil orders promptly and maintain a positive customer experience, even during peak times.
3. Focus on Strategic Initiatives: When you’re constantly scrambling to catch up with orders, there’s no time for strategic initiatives like targeted marketing campaigns or customer engagement strategies. By planning ahead, you free yourself to focus on these crucial aspects that can further boost sales and brand awareness during the EOFY sale.
4. Inventory management: Inventory management during the EOFY sale is more of a balancing act. Too little stock, and you lose out on potential sales. Too much, and you’re stuck with dead stock that eats into your profits. Planning shines a light on this tightrope. It also helps to identify inventory levels and batch details to surface products that are saleable. This input along with seasonality, marketplace trends to determine discounts, set strategic pricing and convert shoppers on the online store
6. Flexible Infrastructure: Consider a flexible storage and fulfilment solution (like a flexible warehouse) that can scale up or down based on your needs. This allows you to adapt to unpredictable demand fluctuations during the EOFY sale without incurring excessive costs.
How To Prepare Your Business For EOFY Sale?
The End Of Financial Year sale in Australia is a game-changer for Australian businesses looking to make products or generate greater revenue. However, as for most sales, astute preparation is needed to avoid hassles mid-sale day. Here are some ways in which you can prepare your business for the sale:
1. Inventory Management
- Clearance: The EOFY sale is the perfect time to move slow-selling inventory. Utilise targeted discounts and promotions to entice customers and free up valuable space for fresh stock. Consider bundling less popular items with bestsellers or offering them at significantly reduced prices.
- Making Room for New Arrivals: Analyse historical sales data and track product trends to forecast demand for the upcoming season. Use this information to strategically allocate remaining inventory space for items with high sales potential. This ensures you have enough stock of the most sought-after products to capitalise on the sales rush.
2. Omni-Channel Selling
- Seamless Shopping Experience: These days, customers expect a seamless shopping experience across all channels. Ensure your online store offers consistent pricing, promotions, and product availability during the EOFY sale.
- Inventory Synchronisation: Partner with a 3PL that has an effective Order Management System (OMS) to maintain real-time inventory visibility across all sales channels. This eliminates overselling and ensures customers can see accurate stock levels regardless of their shopping platform.
3. Product Listings
- Optimising Listings: People hunt for deals during the EOFY sale. Optimise your product listings for search engines and marketplaces by incorporating relevant keywords and highlighting attractive discounts. Make sure high-quality product descriptions and enticing product images capture customer attention.
4. Stock Locking
- Allocating with Precision: 3PLs with smart solutions (An Order Management System (OMS) ) can help you gauge demand across marketplaces during multi-channel sales. By allocating specific inventory for online stores, sellers can choose to cater to regional and marketplace specific demand without having to go out of stock. This allows you to strategically allocate stock based on anticipated demand at each location, ensuring you have enough products to fulfil orders efficiently.
- Real-Time Visibility: An OMS provides real-time insights into your inventory levels across all warehouses. This empowers you to make informed decisions regarding stock movement and replenishment, minimising the risk of overstocking or understocking during the EOFY sale.
How A 3PL Can Help Your Australian Business During EOFY Sale
Since the End of Financial Year sale is a significant day in Australia, e-commerce business owners may face logistical challenges that can delay order fulfilment. Managing inventory, assuring orders reach on time, etc, can overwhelm businesses when handled in house. This is where a 3PL logistics partner comes into play. Partnering with a top 3PL provider in Australia has several benefits, including:
1. Scalable Storage
The EOFY sale often leads to unpredictable fluctuations in demand. Scalable storage options are provided by 3PLs, so you may adjust the amount of warehouse space you need as needed. By doing this, you can make sure you have enough space to hold extra inventory of popular items without having to pay extra for fixed costs.
2. Same Day Delivery/Fulfilment
3PL providers possess expertise in order fulfilment, picking, packing, and shipping. Partnering with one allows you to use their experience and infrastructure to streamline your fulfilment process during the peak EOFY period. This translates to faster order processing and timely deliveries, keeping your customers satisfied.
3. Multi-marketplace Integration
Selling across multiple online marketplaces, such as Shopify, eBay, woocommerce, can be slightly complicated during the EOFY rush. A 3PL with multi-marketplace integration capabilities can streamline your operations by managing inventory and orders across all platforms in a single Order management System (OMS). This frees up your time and resources to focus on other crucial aspects of your business.
4. Nationwide Coverage
A 3PL partner offers advanced inventory management systems that provide real-time visibility into your stock levels across their nationwide network of warehouses. This allows for better forecasting and minimises the risk of stockouts or overstocking, reducing potential losses. With strategically located warehouses across Australia, in perth, Sydney and Melbourne, a 3PL ensures you can deliver to your customers quickly and efficiently, regardless of their location.
5. Value-added Services
The top 3PL companies do more for you than just ship and store your goods. Seek out a partner who provides value-added services such as custom packaging solutions and kitting (assembly of several products).
Conclusion
End Of Financial year sale can be a great source of revenue for Australian sellers if managed accurately. Australian customers are keenly looking forward to the sale day and being prepared in all aspects is absolutely necessary as a seller.
By partnering with a 3PL partner like Locad, your e-commerce businesses can simplify your EOFY Sale order fulfilment across Australia, allowing you to focus on driving sales and strategic initiatives.
With Locad’s comprehensive, tech-driven solutions, you can optimise your operations, enhance customer satisfaction, and achieve greater efficiency in your e-commerce business. Experience hassle-free logistics with Locad Australia today. Sign up now!
