How to grow margins with a strong gifting range

The Better Retailing team finds out how retailers are growing margins with a strong gifting range

There are always occasions when it’s appropriate to give someone a present, whether it’s Father’s Day, Easter, Christmas or someone’s birthday, and retailers are missing a trick if they’ve not got a few gift options in their store. Not only are they – largely – non-perishable items, which will reduce wastage, but they also tend to offer decent margins, which is a massive boon in the current cost-of-living crisis.

However, while the majority of gifts are non-perishable, they do have a shelf life and retailers are advised not to let the same stock hang around on shelves and countertops.

“We’ll have them for one year, then we won’t stock them again for 18 months and then we’ll bring them back,” says Christine Hope, from Hopes of Longtown in Gloucestershire. “You have to stock them to a peak and then give them a rest or people will get tired of it.”

Timing is very important when it comes to gifts – with Christmas and Easter the obvious dates.

“We have a children’s publisher and we stock their range of books,” says Hope. “The margin can be effective, but demand peaks and troughs through the year.”

Putting a few seasonal gifts out a few months out puts the idea in people’s minds, so when they are looking for something closer to the time, they’ll know to come to you.

Choosing products in the right price bracket is also important, not just because of the risk of shoplifting, but because when it comes to really high-end gifts, customers are ultimately more likely to look for them in specialised shops.

“We’re not a gift shop,” says David Worsfold, from Farrants Newsagents in Cobham, Surrey. “It’s a high-volume, low-price impulse purchase that people get when they’re buying a greetings card. I tried £70 shaving kits, but they didn’t take. We tried jewellery, but people don’t come into a newsagent to buy jewellery. But as a pick-up, those men’s bracelets with magnets for arthritis, they go very well for under £20 for Father’s Day.”

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