Episode 19
Christmas Debrief: 2025 Retail Pain Points → 2026 Profit
Shall we take a brutally honest look at the highs and lows of the 2025 festive retail season?
Hi, I'm Clare Bailey, founder of Retail Champion.
In this episode of Retail Reckoning, we dig into what worked, what flopped, and what business owners should focus on to ensure 2026 doesn’t leave any cash on the table.
This episode is packed with straight-talking advice: from sellout items that vanished too soon, to stubborn shelf-sitters that eroded your margins.
I've got some practical checklists to share with you for reviewing customer feedback, staffing woes, and digital visibility—making sure you don’t miss a thing.
Whether you’re a seasoned shop owner or an ambitious start-up, this episode is your guide to turning post-Christmas chaos into clarity, actionable strategy, and a winning 2026.
Let’s get your Retail Reckoning together—no dusty shelves allowed!
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Transcript
Do you want to make sure that there's no cash left on the table by
Speaker:your retail business in 2026? Well, if so, this
Speaker:episode will definitely help you with that.
Speaker:Hello to the lovely retailers, hospitality heroes, makers and
Speaker:independent legends. Welcome back to Retail Reckoning. I'm Claire
Speaker:Bailey, the retail champion and today we're diving into the truth
Speaker:telling margin making, if slightly
Speaker:painful Christmas debrief. Yep, it's that time.
Speaker:Retail Reckoning. No space for
Speaker:dusty shelves.
Speaker:Put the leftover mince pies down, grab yourself a coffee or
Speaker:something stronger and let's take a brutally honest look at what actually
Speaker:happened this peak. What worked, what flopped and
Speaker:what needs to change if 2026 is going to be the year you
Speaker:stop leaving money on the table. If there's one thing I know,
Speaker:after working with thousands of independent businesses, the
Speaker:real growth isn't in working harder, it's in working
Speaker:smarter, as the saying goes. Starting with the things
Speaker:that quite often get ignored. So,
Speaker:right, my first question. Did Christmas deliver what you expected?
Speaker:And I don't want the glossed up. Oh, we did find. Thanks. Version
Speaker:the Truth let's talk about two
Speaker:classic situations that every independent business owner
Speaker:secretly obsesses over but doesn't really often sit down to
Speaker:analyze properly. What about the sellout
Speaker:items you kicked yourself over because you weren't properly
Speaker:stocked? Furthermore, what about the stubborn
Speaker:slow movers that clung to the shelves like, yeah, you,
Speaker:granny's tinsel? Let's start with these.
Speaker:The sellouts are missed margin. Think about what flew out the door faster
Speaker:than a toddler after Santa. What sold out a week too early?
Speaker:Why did customers keep asking after you'd run dry? Have you
Speaker:got any more of that? These are the moments that sting because they're pure,
Speaker:unfiltered lost profit. You could have sold more, you could have made
Speaker:more. And next year you will if you capture
Speaker:this properly. This is about backing your winners
Speaker:and making sure your stock profile is there
Speaker:to support your sales forecast and be bold. Then we
Speaker:need to look at your shelf sitters. That's pure margin
Speaker:erosion. These need to be the ones that you have a when
Speaker:it's gone, it's gone policy on. But they end up being the ones
Speaker:you had to discount. They've eaten up margin.
Speaker:That made you ask yourself, why on earth did I think this was a good
Speaker:idea? These lines are not just annoying,
Speaker:but they're data. That insight, despite being
Speaker:a failure potentially is important, sometimes humiliating,
Speaker:but valuable, and data nonetheless to inform future decision
Speaker:making. Data is what gives you the power to
Speaker:make better decisions in 2026.
Speaker:The next question that we all ask ourselves,
Speaker:did you have enough staff? Was the staffing, service and
Speaker:customer experience really up to standard? Do
Speaker:you believe your service levels were solid or did returns
Speaker:spike? What were customers actually saying about you? The good
Speaker:and the bad. Here's the hard, cold truth.
Speaker:Basically, your peak season exposes everything. And if
Speaker:there's a weakness, Christmas is going to shine a blinding
Speaker:fairy light on it. So I've got a couple of checklists for you so we
Speaker:don't miss anything. What you need to review are
Speaker:compliments and complaints, service bottlenecks,
Speaker:did you have queues abandoned, baskets offline, and
Speaker:more importantly, online product questions you got asked a thousand
Speaker:times. Packaging issues, did anything get damaged?
Speaker:Things that delighted your customers and things that irritated them.
Speaker:So that's my checklist using that. That's where
Speaker:you find where the golden moment lies. Because
Speaker:every frustration is a fixable problem. Every
Speaker:positive is something you can repeat and do more of
Speaker:the same. Then we have to look at things that are
Speaker:somewhat beyond your control, but not entirely. Things like footfall,
Speaker:online traffic and so on. Were your customer numbers
Speaker:up? Did you get more E commerce orders?
Speaker:And have you got more people signed up for emails or any
Speaker:loyalty system, newsletter or more following on your
Speaker:social channels? If your answer is yes, that's great.
Speaker:If it's no, that would be now a priority. If the
Speaker:answer's none, now, I'm not sure.
Speaker:Then we probably need to talk about your analytics setup because if you don't
Speaker:know your numbers, it's like driving with a blindfold on.
Speaker:It's really important to understand what's going on in the business
Speaker:and understanding some of these metrics, although they
Speaker:don't directly translate to sales, they can
Speaker:translate to sales. The more people who are listening to you, the
Speaker:more people who are likely to buy from you or recommend you.
Speaker:The next part is where things get a little bit juicy.
Speaker:Your range review. This is your biggest lever for profit
Speaker:now. Your range is the single biggest driver of margin, cash
Speaker:flow and customer satisfaction and loyalty. And at Christmas,
Speaker:it's the most revealing moment to measure whether your range
Speaker:worked or not. So I have another checklist for you.
Speaker:I want you to refer to your business data, epos or whatever
Speaker:else you've got and check the following things. So
Speaker:this would be your sell through rates, your margins,
Speaker:your SKU count, and therefore skew proliferation. So,
Speaker:example, you've got two SKUs that do the same job and therefore
Speaker:identification of potential cannibalization between
Speaker:SKUs where you could have consolidation of range. Also look for
Speaker:gaps where perhaps you weren't offering a good, better
Speaker:best, or there was a potential to add another category
Speaker:or type of product to increase basket size and so on. You need to
Speaker:spot your overcrowded categories where perhaps you've just got too
Speaker:much choice. And also going on from that. I
Speaker:think it's important to understand the impulse buying
Speaker:behaviors, the things that you put right next to the till, what other
Speaker:things that people might pick up. And if you're in say a ladies
Speaker:wear retailer and there might be a little tiny handbag sized
Speaker:perfume or some incense sticks or a relaxing
Speaker:candle next to the till, would that bump up the basket size that people just
Speaker:pick up whilst they're waiting? And then back to my checklist. You have to
Speaker:review your seasonal products versus continuity items because seasonal
Speaker:make you a boost in profit in the season, but
Speaker:continuity is what keeps you alive all year round. And so this
Speaker:is where your epos data matters. And if you don't already have an epos,
Speaker:it's probably one of the singular most important tools for any
Speaker:retail, hospitality, leisure business that you can imagine.
Speaker:Your data won't lie, but sometimes your gut feel
Speaker:will and moderating gut feel and instinct
Speaker:with tangible business data is really, really important.
Speaker:So when it comes to EPOS data, got you another short checklist.
Speaker:You need to use things like last year's sales, this year's trends,
Speaker:which won't come from your epos but might come from reading documents. For example,
Speaker:there's trend documents available online and there's insights and
Speaker:reports. And if you're lucky enough to be able to get down to the British
Speaker:Library, you can get access to a lot of that for free. You've got your
Speaker:own customer feedback, their social comments. You can speak to
Speaker:your suppliers and get industry predictions and also
Speaker:buyer insights in terms of what categories your suppliers believe
Speaker:are on trend. But your EPOS data is essential for things
Speaker:like last year's sales margin, promotional performance, sell
Speaker:through rate, stock cover and so on. You use this kind of
Speaker:insight to then begin to shape your 2026 range
Speaker:architecture. And that's your high level overview, the shape of the range
Speaker:before you break it down into more detail. I mean you might
Speaker:have some indication on categories, percentage performance by category
Speaker:and so on. But maybe you haven't gone as far as category subcategory,
Speaker:SKU count. Within the SKU count, how do each product perform
Speaker:in terms of good, better, best? You might not fully have
Speaker:appreciated how you might pull back on continuity
Speaker:lines to allow space for highly Seasonal allocations
Speaker:and impulse purchases. It might not necessarily at this stage include
Speaker:your feature lines, your continuity and your newness strategy. But these are all
Speaker:really, really important to ultimately range
Speaker:architecture leading into range plan. And this
Speaker:is the exact kind of prep work you need to be doing
Speaker:now before you hit up the trade shows in early
Speaker:February. So if you're walking into Spring Fair, you know, on the
Speaker:2nd of February, for example, if you walk into Spring, Spring Fair or Top Draw
Speaker:or Moda or any of these other major exhibitions and shows
Speaker:without the analysis done, it's like you're shopping blind.
Speaker:But you're not shopping blind for you, you're shopping blind for your
Speaker:ideal customer. So you have to put yourself in the
Speaker:shoes of the ideal customer, not think about what you like. Well, unless
Speaker:you're lucky enough to be your own ideal customer, which doesn't apply to
Speaker:everybody. And you need to think about all these different things. What can
Speaker:you sell in volume? What will make you the maximum margin? What is
Speaker:going to actually wow the customers, bring them through the
Speaker:door and keep them coming back throughout the season, given that in
Speaker:February you're buying potentially as far ahead
Speaker:as autumn, winter 2026, and beginning to
Speaker:even entertain Christmas 2026, 10 months
Speaker:early. This is so fundamentally important because I read
Speaker:somewhere that depending on the nature of the retail business, Christmas sales
Speaker:represent between 30 and 60% of your annual profits. This
Speaker:is not one to get wrong. And leading on to that, we look at Product
Speaker:Life Cycle, and my brilliant colleague Kim,
Speaker:who's even more geeky than me, breaks this down using the
Speaker:Boston Consulting matrix into stars, dogs, cash cows and question
Speaker:marks. And that's a real retail discipline.
Speaker:So if it's a star, it's selling well and it's
Speaker:profitable. If it's a cash cow, it reliably sells.
Speaker:It's not particularly glamorous, but it keeps the money coming in. If it's a
Speaker:dog, it's barely selling and wasting space. And unless
Speaker:that dog exists in a basket with a star or
Speaker:a cash cow. Thus you could suggest to yourself that the
Speaker:consumer buys the basket and if the
Speaker:dog wasn't on your range, they wouldn't buy the higher profitability
Speaker:items. That's something to get rid of. And a question mark is
Speaker:maybe new, maybe you're unsure at the moment, it could go either way.
Speaker:But it's one to watch. And this leads to some serious
Speaker:decisions. Obvious really, if you think about it. Invest
Speaker:in the winners, support the rising stars, delete the
Speaker:dogs, as long as they don't belong in the basket with some of the better
Speaker:products and test the question marks before committing heavy
Speaker:stock levels and significant order sizes. This is how you're actually going to
Speaker:protect your cash flow and avoid your sort of January
Speaker:to February fear. Range shopping, when you
Speaker:realize your stock levels are a little bit out of whack
Speaker:stock, leads me on to thinking about supplier management.
Speaker:I think it's really important to think you're not alone. Suppliers work with
Speaker:potentially hundreds, if not thousands of businesses like yours, and they have
Speaker:insights, so why not use them? Suppliers are more than
Speaker:always willing to give those insights. And supplier management
Speaker:is all about creating a collaborative relationship.
Speaker:So you can ask them questions like what's selling well in the wider customer
Speaker:base. They don't have to tell you who the customers are, as long as it's,
Speaker:you know, within your relatively local geographic market.
Speaker:You can ask them what's falling off the radar for them, what's tanking
Speaker:and why. So what are the suppliers considering
Speaker:delisting that you should be potentially delisting to? The
Speaker:really killer question is what point of sale, as in
Speaker:posters, signage, window displays and so on. Or marketing support can they offer
Speaker:you? Because quite often suppliers will offer you marketing support
Speaker:so that you can promote their product and stimulate their sales too.
Speaker:Because remember, you're their distribution channel. Without
Speaker:you, who the hell are they going to sell to? I mean, they might be
Speaker:able to sell online, but having physical retail outlets certainly
Speaker:makes their life a whole lot easier. Then you could ask them things
Speaker:like are they planning to discount for promotions and are they planning to pass those
Speaker:discounting opportunities on to you? You could ask them what they've got
Speaker:in new product development for next year, so looking even for
Speaker:further ahead. But you could also ask them what's going to be discontinued so you
Speaker:can plan your stock profiles and so on. And the thing is, most small
Speaker:retailers don't ask. The big guys definitely do. And suppliers
Speaker:aren't going to volunteer the information if they're not asked. You know, it's just extra
Speaker:work. So ask always, because if you don't ask, you don't get
Speaker:linking to some of the comments on suppliers as well. We've got to consider your
Speaker:pricing and promotions and it's more about value and less about
Speaker:about margin giveaway if you really want success, because you
Speaker:can't discount your way to success unless you're a scale of
Speaker:operation akin to Aldi and Lidl, which
Speaker:generally most aren't. It's just not viable, it's not
Speaker:sustainable. But you can build strategies that add value without destroying
Speaker:Your margin, things like the pricing ladder. I love a pricing
Speaker:ladder. Good, better, best. Your target customer wants to solve
Speaker:a problem and you have, let's say, three products that solve their problem.
Speaker:One is good, it has to be good and it's at the entry price
Speaker:point and that solves the problem. But generally speaking, they kind of
Speaker:want a few more bells and whistles. So they might trade up to better and
Speaker:if they're feeling particularly flush, they might go for best.
Speaker:Usually people settle at the better level. So it's a bit like a
Speaker:standard distribution curve. A few buy it good, a few buy it best, and most
Speaker:buy it better. But at least you're giving choice to people. So if they're having
Speaker:a difficult month, maybe your customers are self employed and they've had a contract
Speaker:canceled. They might trade down to good or they've had a big win and they
Speaker:might treat themselves to best. But having that structure in place
Speaker:gives them the choice without overwhelm. And I think it's also important
Speaker:to consider promotions. They're a lever to influence buying
Speaker:behaviors from your consumers and they're not a crutch to get rid
Speaker:of dead stock. That would be clearance, which is fundamentally different.
Speaker:So promotions can be things like highlighting products, creating
Speaker:bundles, adding value through other means than just
Speaker:discounting. A way to manage this is to tie
Speaker:offers to a marketing calendar. So using calendar events like
Speaker:school holidays, religious celebrations, Easter, Christmas and so
Speaker:on, Mother's Day, Valentine's Day, sporting
Speaker:events, I mean it really depends what you sell, what key
Speaker:activities go on your marketing calendar. But then you can use promotions and
Speaker:window displays and highlighting to draw attention to products that are
Speaker:relevant to a particular moment in time or
Speaker:to do with end of season, which is where we're looking more at clearance than
Speaker:we are at what you would class as promotion. And I do
Speaker:think there's an important distinction there. You can also link pricing
Speaker:to stock levels. So having the when it's gone, it's gone. Buying
Speaker:small batches, particularly of high fashion or high
Speaker:seasonable items is really important because it creates the fear of missing out.
Speaker:And it means that people are more likely to buy at full price
Speaker:rather than not get one at all. And as we mentioned before,
Speaker:in supplier management there's often a lot of supplier funded support available
Speaker:and it's definitely available, so ask them and use it
Speaker:when it's offered. And these are really the strategies you need to
Speaker:use to protect your profitability while still delivering some excitement
Speaker:and newness and perceived value in store or online.
Speaker:The other area linking to that promotions and so on
Speaker:is to make sure you get your marketing, your
Speaker:merchandising in store. And I guess the E commerce merchandising is
Speaker:just as relevant and everything discoverability,
Speaker:right? Because I think
Speaker:2026, we won or lost on this. So the first one is
Speaker:about having a good integrated marketing strategy
Speaker:online and offline. So getting those promotional calendars we just
Speaker:touched on sorted now and not having last minute
Speaker:scrambles so you can plan things like the campaigns you
Speaker:might do according to the time of year, the themes you might go with.
Speaker:So love is in the air for Valentine's Day. Everyone's got
Speaker:a mum. So Mother's Day themes of any types and
Speaker:link your campaigns to your themes and then that flows through.
Speaker:So if you've got physical presence, window displays, online
Speaker:presence, it could be banners or a change to a little bit of a
Speaker:template or something particular about the way the styling looks.
Speaker:Then you could even be looking at events, whether they're local events or
Speaker:events that you run. I know in a couple of locations they do
Speaker:certain trails like an Easter egg hunt and some they're really useful
Speaker:because it gets people out and about families collecting
Speaker:stickers or tokens or something to redeem an Easter egg at the end, but it
Speaker:gets them to go into the shop. Then this can percolate through to things like
Speaker:email marketing content. I've already mentioned website
Speaker:look, but you know, refreshes. It might be about changing some of the
Speaker:language and product descriptions to make it more
Speaker:search friendly for that particular time of year or campaign.
Speaker:You might be able to offer online gift guides, top products for Mother's
Speaker:Day, under £10, under £20, under £50 and so on.
Speaker:And there could be local partnerships whereby you could collaborate. So you
Speaker:might be a confectioner and there's a florist down the road and there's somebody that
Speaker:does balloon art. You could come together and put something
Speaker:beautiful together as a package, as a local partnership, or
Speaker:simply put on a local shopping event. There's loads
Speaker:and loads of opportunities to bring online and offline marketing to
Speaker:life. When it comes to E commerce. I'd have to ask if you're not selling
Speaker:online, why? Because it's affordable. And
Speaker:even if it only acts as a catalog and drives footfall to your store,
Speaker:it still gives people an insight into the products that you offer. And
Speaker:then further down the line, if they've experienced your service, they might want to buy
Speaker:online, click and collect or come in and collect and whatever, but it just
Speaker:offers you that extra channel to market if you are selling
Speaker:online, it's important to think all the time about how to
Speaker:make it as frictionless as possible, how to make it easier, faster,
Speaker:cleaner and clearer, get that transaction through
Speaker:and to embed things like remarketing for basket abandonment.
Speaker:And Steph in our team is one of the genius e commerce people. She had
Speaker:an independent business herself for 10 years and ran a highly
Speaker:effective e commerce site. So if anybody's worrying about that,
Speaker:give me a shout and I'll hook you up with Steph. Actually, to be fair,
Speaker:Steph's also our search guru. She advocates local search,
Speaker:as do I. Because your Google business profile is
Speaker:free and it's your shop window for customers who haven't found you yet.
Speaker:The number of searches for the thing you offer near me
Speaker:that people do on their phones when they're in a place they don't particularly know
Speaker:is immense. And having the pin on your
Speaker:premises not sent for a postcode, having some good photography, having some
Speaker:decent wording, correct opening hours, oh please don't get me
Speaker:started on that. How many times have I turned up somewhere and they're closed but
Speaker:it says they're open on Google. It's just so simple and
Speaker:don't even need a website. You can just take people to your Facebook page or
Speaker:your Instagram if you haven't yet set up e commerce. But it's so
Speaker:powerful. My argument on this would be if you haven't fully optimized
Speaker:and looked at the potential of your Google business profile, get started.
Speaker:In fact, start yesterday.
Speaker:That leads us into social media. Customers buy from brands
Speaker:they know like and trust and if you're silent online, they don't really know
Speaker:you. So having a good presence on the
Speaker:consumer facing platforms, so the likes of Facebook,
Speaker:Instagram, TikTok, you know, those kind
Speaker:of platforms. But if you're not already there, start with
Speaker:one, get that right and build from that. But in 2026,
Speaker:being invisible on socials just makes people wonder if
Speaker:you're a scammer or not. They expect it. It's a simple
Speaker:fix. Just to be visible.
Speaker:I've said lots now, but my final word,
Speaker:I guess I want 2026 to be your best year yet.
Speaker:I want it to be my best year. I want it to be everybody's best
Speaker:year. Despite what's happened in the last two budgets. I
Speaker:think if you're brave and bold and decisive, everything
Speaker:you need to make next year exceptional is already in your hands.
Speaker:If you've got the data from this Christmas, great. If not, let's look at Getting
Speaker:you an EPOS in place, the experience your customers had,
Speaker:learn from it, the gaps in your range, build on it,
Speaker:and the opportunities just staring you in your face, like out of stocks
Speaker:or not sold through products, sort it. And if
Speaker:you're still sitting there thinking, claire, I know I need to do this,
Speaker:I don't have the time or the systems or the headspace, then just please reach
Speaker:out. I've got a really fabulous team at the Retail Champion and we've worked
Speaker:with thousands of independent retail, hospitality, leisure, personal care and
Speaker:visitor facing businesses. And we help with everything from strategy to e
Speaker:commerce, even email marketing, socials.
Speaker:Kim's brilliant on store layout and merchandising and customer
Speaker:experience. I cover, along with Kim, range planning,
Speaker:supply chain pricing and promotions, your EPOs, analytics, how to
Speaker:make decisions from your data and ultimately it's all about turning the
Speaker:chaos that you might be feeling and the overwhelm you might be feeling
Speaker:into clarity, strategy and actions
Speaker:that actually deliver the business results that you need given
Speaker:the backdrop of the prevailing economic situation. So if
Speaker:you want 2026 to be the year, you stop winging it and start winning.
Speaker:We'd love to help, just give us a shout. I'm happy to have a no
Speaker:obligation introductory call. Check out retailchampion.co.uk
Speaker:and let's get you future ready. Well, anyway, here's to an
Speaker:incredible year ahead. One built on smart decisions, solid
Speaker:processes and the courage to take bold action. You've got this and
Speaker:I'm here to help you make sure you absolutely smash it. Until
Speaker:next time, go be brilliant. My name's Claire Bailey, the
Speaker:Retail Champion and this was Retail reckoning. Yeah,
Speaker:Retail reckoning. Retail
Speaker:reckoning. No space for dusty
Speaker:shelves. Cause retail reckoning
Speaker:owns the floor.
Speaker:Sam.
