Avoid giving away free stuff around Christmas (and beyond)

It's fine to be in a Christmas spirit, even year-round, but create holiday specials without undercutting your margins.


Jonathan Winstel, a Matco Tools franchisee, likes to make holidays a special time for customers, but he does not lose money doing it. Winstel makes the holidays a special time for customers by giving away merchandise he has earned from his own credit card purchasing and freebies from his suppliers.

These giveaways, however, become challenging at Christmas since customers come to expect free things at that time of year. "They always expect something for Christmas from you, and they're never happy, no matter what you give. For some reason, they expect a shirt, a hat, a jacket, or a tool, all for Christmas."

He dresses a toolbox with Christmas décor and divides it into four sections, based on how much customers spend during the week on average: $20, $40, $50 and $100. Customer receipts are placed in the appropriate section and are redeemed for prizes. "The better customer you are, the better prizes you get," he says.

Winstel tries to win his share of the holiday-giving spirit as well. While he gives away merchandise, he asks customers to pay $10 more a week to make up for the week they didn't pay him anything. "You always have to find a way around 'the customer's always right.' You have to make it work in your favor with the 'gift of gab.'"

 


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