Below are 11 steps small businesses in the US, Canada, and UK can take to boost demand this holiday season. The recommendations are based on 12,700 responses to the 2022 Intuit QuickBooks Holiday Shopping Survey.

Step 1: Embrace e-commerce

At least 50% of all consumer spending will be done online this holiday season—which is predicted to be above 2021 levels. Up to eight out of 10 small businesses surveyed say online revenue will be more important during the 2022 holiday season compared to 2021.

Step 2: Make it easy to buy online

More than seven out of 10 consumers want small businesses to make it easy for them to buy online this holiday season. They will spend more money at small businesses with quick and easy checkouts, guaranteed deliveries and returns, and up-to-date inventories. Respondents in the UK are the most price-sensitive—putting “price-match guarantees” at the top of their wishlist.



Step 3: Don’t neglect payment systems

As the chart above shows, consumers expect online checkouts to be easy. Almost all of the small businesses surveyed (up to 99%) generate revenue online and many have their own websites, but some don’t have integrated payment systems. This is despite the fact that, on average, online sales account for up to two-thirds of their total annual revenue.



Step 4: Diversify online revenue

When buying from small businesses online, consumers use third-party ecommerce sites as often as small businesses’ own websites. Social media marketplaces such as Facebook, Instagram, and TikTok are also popular.

Step 5: Put your brick-and-mortar business online

It’s important for all small businesses to be visible online—even brick-and-mortar businesses. Up to one in two consumers say they are less likely to buy from a small business in-person if they can’t find them online, according to the survey. Get that Google Maps listing today.

Step 6: Celebrate what do you do best

Around seven out of 10 small businesses surveyed predict more competition this holiday season, which could affect their revenue. To succeed, they’ll need to demonstrate what sets them apart. Read on to get some ideas.

Step 7: Remind customers you’re local

Consumers like to buy from small businesses because it supports their local economy and they want to keep them going, as the chart below shows. Many choose small businesses because they are locally-owned and operated, or because they have local supply chains.

Step 8: Focus on service and quality

More than seven out of 10 consumers surveyed say they get the best service and quality from small businesses. When looking for unique holiday gifts, roughly two-thirds choose small businesses, such as local gift shops, over large businesses. This is another way small businesses can differentiate themselves.

Step 9: Offer price discounts

The best way to get people shopping in-person this holiday season, according to the QuickBooks-commissioned survey, is to offer in-store experiences and price discounts. And yet, more than half of small businesses surveyed don’t plan to offer any discounts this holiday season. This will be especially important in the UK, where consumers are showing more price-sensitivity than in the US and Canada.

Step 10: Start advertising now

September, October, and November are when the majority of consumers start their holiday shopping, according to the survey. Small businesses with marketing budgets should start their campaigns and promotions at the same time. In November, Black Friday remains the most popular shopping day.

Step 11: Tell customers what’s in stock

If people think shelves are empty (as many of us experienced during the pandemic) they won’t even try to buy. With up to three-quarters of consumers worried about product shortages this holiday season, small businesses should be ready to remind people what’s in stock.



Read more in the next section, How small businesses prepare for the holiday season

QuickBooks predicts up to 65% of small businesses’ annual revenue could be generated during the 2022 holiday season, based on the Holiday Shopping Survey 2022 of 3,000 small business respondents. For the smallest businesses in the sample—those with up to 10 employees—that’s equivalent to roughly $327,000 per business (in the US), C$370,000 (in Canada), or £212,000 (in the UK).

Here are six steps small businesses are taking to prepare for the 2022 holiday season.



Step 1: Hiring early due to skills shortages

The majority of the small businesses surveyed are currently hiring seasonal workers. On average, they are looking to add an extra 10 to 12 seasonal workers per business, which is equivalent to an almost 50% growth in the average workforce. But almost all of them (up to 99%) face hiring challenges. This is despite the fact that eight out of 10 started hiring earlier this year than they did before the 2021 holiday season.

Ghosting

The number-one hiring challenge small businesses currently face is successful applicants leaving, or having to be let go, soon after they join. Up to two in five have been “ghosted” by successful applicants who never showed up on day one.

Step 2: Buying early to get ahead of inflation

Inflation, unpredictable demand, and ongoing supply chain problems are combining to make it much harder for small businesses to prepare holiday season inventory. To get ahead of future price rises, up to 64% have ordered earlier or in larger quantities.



Inventory shortfalls

Despite many buying early or in larger quantities, more than seven out of 10 small businesses predict inventory shortfalls this holiday season.



Unpredictable demand

Another major challenge is the fact that the COVID-19 pandemic has made it harder to predict customer demand, according to three-quarters of the small businesses surveyed.



Disrupted supply chains

Nine out of 10 small businesses have experienced inventory or supply chain challenges this year. The number-one challenge is rising costs, followed by ongoing supply chain disruptions.



Step 3: Trying to keep shipping and fulfillment costs down

When buying online, customers look for guaranteed deliveries and returns. But that’s only if they complete their purchase. “High shipping costs” are the number-one reason people abandon online shopping carts.



Inflation adds to shipping costs

More than nine out of 10 small businesses that ship products to customers (up to 96%) have had problems with this in 2022. Again, the biggest is the cost, which is making it harder for some to offer free shipping.



Step 4: Getting help with marketing

Up to eight out of 10 of the small businesses surveyed say marketing has been a challenge this year. Around one in four say they don’t have the expertise. The good news is help is available.



How to promote holiday season discounts

Small businesses in doubt might learn something from their peers. According to the small businesses surveyed, the best ways to promote holiday season promotions and discounts are through social media marketplaces, emails to customers, and social media ads.



No promotions, no demand?

Less than half of the small businesses surveyed plan to offer special promotions or discounts this holiday season. That’s despite the fact that consumers say this is one of the best ways to get them to spend more money. Other small businesses are having to increase prices due to inflation.



Step 5: Investing in omni-channel sales

Omni-channel shopping such as click-and-collect isn’t a buzzword anymore. It’s mainstream. Almost all of the consumers surveyed—up to 97%—combine online and in-person shopping.



Connecting the real and virtual worlds

More than eight out of 10 small businesses agree: they need to offer seamless online and in-person shopping experiences for their customers.



Step 6: Preparing in-store experiences

Both small businesses and their customers want to see people in-person again this holiday season. In fact, “seeing customers in-person again” is what small businesses are most looking forward to. And their customers admit they will spend more money in stores when small businesses organize special in-person experiences, such as educational events or tasting parties.

Read more in the next section, How much consumers will spend



This holiday season, according to the Intuit QuickBooks Holiday Season Survey 2022, consumers will spend roughly:

• $815 per person in the US (78% of median weekly income), equivalent to $211b nationally
• C$825 per person in Canada (73% of median weekly income), equivalent to C$26b nationally
• £671 per person in the UK (109% of median weekly income), equivalent to £36b nationally  

Spending is expected to be higher in the US and Canada compared to 2021 but could be flat in the UK. In the US and Canada, respondents with higher incomes will spend almost double the estimates above. In all three countries, those with lower incomes will spend about half as much.



Cutting back on essentials to maintain holiday spending

With inflation biting, at least seven out of 10 consumers have made cutbacks on essentials this year so they don’t have to cut their holiday season budget.



Saving on fuel and food

In the US and Canada, people have been most likely to cut back on everyday travel costs such as fuel. In the UK, clothing tops the list. Roughly a third of the respondents in each country have cut their weekly food and drink budgets.



Spending at small businesses predicted to rise

Out of concern for their survival and to support local economies, more than eight out of 10 consumers surveyed plan to maintain or increase their spending at small businesses this holiday season. The increase is likely to be highest in the US, lowest in the UK—as the chart below shows.



Online spending also expected to increase

More than eight out of ten consumers surveyed will spend as much or more money online this holiday season. Again, the increase is likely to be highest in the US, lowest in the UK.



Inflation is making online shopping even more popular

The QuickBooks-commissioned survey reveals a direct connection between inflation and online shopping. More than seven out of 10 consumers are shopping online more often to find the best prices.



Black Friday will be the most popular shopping day

Despite the growing popularity of shopping small and shopping online, Black Friday is likely to be the most popular holiday shopping day this year—ahead of Small Business Saturday and Cyber Monday.



Intuit QuickBooks Holiday Shopping Survey 2022

Intuit QuickBooks commissioned online surveys, completed in September 2022, of 12,700 respondents in the US, Canada, and UK, comprising 9,700 consumers (adults aged 18+) and 3,000 small businesses with up to 100 employees. In the US, there were 7,000 respondents: 5,500 adults and 1,500 small businesses. In Canada, there were 2,400 respondents: 1,700 adults and 700 small businesses. In the UK, there were 3,300 respondents: 2,500 adults and 800 small businesses. The small business sample excludes businesses that do not consider the holiday season important to overall annual performance. The majority of the small businesses surveyed are product-based (76% in the US, 60% in Canada, 79% in the UK). Their average annual revenues are $732,000 in the US, C$912,000 in Canada, and £709,000 in the UK. The average number of employees per business is 26 in the US, 27 in Canada, and 27 in the UK. In the US, 49% have 1-10 employees. In Canada, 38% have 1-10 employees. In the UK, 52% have 1-10 employees. Percentages have been rounded to the nearest decimal place so values shown in charts and graphics may not add up to 100%. Responses were collected in online surveys using Pollfish audience pools and partner networks with double opt-ins, random device engagement sampling, and post-stratification based on local census data to ensure accurate targeting and results. Respondents received remuneration.