If you ask most American workers what they think about holidays, they’ll tell you one good holiday deserves another. Put simply, workers love holidays.
And for small business owners, especially those in the hospitality and retail industries, holidays bring more customers and sales. For instance, if you own a flower shop, you’ll most likely get more foot traffic and online sales on Memorial Day.
Thus, when holidays come around, the million-dollar question businesses will grapple with is whether to keep their doors open or take the day off. If they remain open, they’ll also have to consider employee holiday pay and possibly plan to hire extra staff.
Plus, if you’re based in Massachusetts or Rhode Island, businesses must comply with special holiday rules in those states. In this guide, we’ll discuss the factors small businesses should consider when deciding whether to close or stay open during holidays and the pros and cons of both.
But before we dive in, here’s a reminder of the holidays officially recognized by the Federal government.
United States Federal Holidays
According to the Office of Human Resources Management (OHRM) under the Department of Commerce, the Federal government recognizes these 11 holidays1:
- New Year’s Day — celebrated on January 1
- Martin Luther King’s Birthday — celebrated on the 3rd Monday of January
- Washington’s Birthday (Presidents Day) — celebrated on the 3rd Monday of February
- Memorial Day — celebrated on the last Monday of May
- Juneteenth National Independence Day — celebrated on June 19
- Independence Day — celebrated on July 4
- Labor Day — celebrated on the 1st Monday of September
- Columbus Day — celebrated on the 2nd Monday of October
- Veterans’ Day — celebrated on November 11
- Thanksgiving Day — celebrated on the 4th Thursday of November
- Christmas Day — celebrated on December 25
In practice, it’s mostly federal agencies, public learning institutions, and banks that observe each of these holidays and offer holiday pay. Private businesses aren’t legally obliged to honor federal holidays or offer paid time off. This means it’s up to you to decide whether to stay open or close during holidays. Fortunately, reviewing these factors will help you make the right decision.
Consider the Nature of Your Business Sector
Companies in sectors such as financial services are happy to close their doors for almost every holiday. But businesses in the hospitality, beauty, media, entertainment, aviation, and retail sectors mostly stay open during the holidays.
That’s why businesses must first review their industry’s operations flow. For instance, during the Memorial Day weekend, most Americans spend quality time on the beach, travel to visit family and friends, or hop on a pre-planned Memorial Day weekend getaway.
In fact, AAA Travel expects about 42 million Americans to travel over the Memorial Day Weekend2. This means they’ll eat out at restaurants, book hotels, charter planes and cabs, and grab drinks with friends. So if a business is in the travel and tourism sector, they’ll likely get more customers streaming in for breakfast, lunch, dinner, happy hour, and lodging.
If a business chooses to close business for Memorial Day weekend, they would miss out on substantial sales and the opportunity to impress new customers.
Even so, sometimes you need to zig when your competitors zag. For example, if you own a car repair shop and most of your peers in your area routinely close for holidays, you may decide to stay open and observe the results.
Do Your Target Customers Observe These Holidays?
All great entrepreneurs know their target customers exceedingly well. To make an informed decision regarding your customers’ holiday preferences, study your customer demographics3. In this case, you’ll want to focus on the occupation of your customers to know if they’ll have a day off for the holidays.
Suppose a business’s target audience works in institutions that traditionally close for federal holidays. In that case, they can infer they’ll have more time to visit your business and enjoy their services and products. But if most of their customers work in places that don’t observe these holidays, they may decide to close or open for half a day.
Consider What A Particular Holiday Means To Your Employees
While businesses should always do what’s convenient for their customers, they should also cultivate goodwill amongst their employees.
For instance, if you have multiple veteran employees in your small business, it would be thoughtful to close business on Veterans Day and offer paid time off if you can afford it. This would make your veteran workers feel honored and appreciated for their selfless service to our great nation.
3 Main Benefits of Staying Open on Holidays
These three main perks stand out:
You Get More Sales
According to the National Retail Federation, 2022 holiday sales closed at a historic high of $936.3 billion4. Even if a business is not in the retail sector, this data illustrates that Americans spend more on holidays than on typical days.
The prospect of making more revenue from holiday sales from increased foot traffic is one of the main motivating factors for small businesses to stay open on holidays. With this, businesses have a better chance of increasing their sales as Americans undergo holiday shopping.
It Fosters Business Awareness
When most American workers get a chance to enjoy a holiday, they naturally seek to do something fun and exciting. If your business participates in curating a fun holiday experience for vacationing customers, they’ll most certainly remember your business even after the holiday is over.
It’s an Opportunity to Market Other Offerings to Qualified Leads
Some services and products are synonymous with particular holidays. Turkeys symbolize Thanksgiving Day, Christmas trees symbolize Christmas Day, and red poppies symbolize Veterans and Memorial Day.
When selling such holiday symbols, businesses can cross-sell and up-sell their customers more efficiently. For example, if you run a flower shop, you may include military gift packages to sell to customers during Memorial or Veterans Day.
This way, when customers buy red poppies, you can easily cross-sell your military gift hampers since these buyers are already interested in military memorabilia.
Downsides of Opening Your Business on Holidays
If businesses aren’t well-prepared for the heightened holiday shopping traffic, they’ll face the following drawbacks:
Possible Employee Backlash
Working on holidays can dispirit employees who would rather take the day off. Plus, the increased foot traffic could overwhelm your staff on duty and kindle job resentment.
Employee backlash is significantly harsher if the job tasks are demanding and workers highly regard the skipped holiday. But, businesses can manage or prevent this backlash by:
- Including a holiday clause in your workers’ employment contract explaining your holiday policy
- Hiring seasonal staff to match the increased holiday workload
- Introducing a holiday-swapping policy
- Offering employees a good overtime pay rate or premium holiday pay rate
Overflow of Customer Traffic May Stretch Your Customer Service Capacity
While you can easily find and hire temporary staff to cover menial tasks, you’ll have difficulty filling in technical or skill-intensive roles. For instance, if you own a restaurant, you can readily hire extra wait staff during a holiday, but you may find it difficult to locate an expert chef.
In such a case, your chef may not be able to handle the rushed customer orders with the typical finesse. This may lead to order delays or run-of-the-mill food, triggering customer complaints. A customer who may not have enjoyed your food before and attested to your food quality is unlikely to return after the holidays to give your chef a second chance to impress.
Best Practices for Preparing for a Busy Holiday
If you can profit from staying open on holidays, planning can save you a headache. Besides hiring extra staff to help with the increased workload, consider:
Notify Your Customers in Advance
Create a holiday open hours flyer and display it on your website or pin a holiday hour sign on your premise’s doors or windows. Doing this creates top-of-mind awareness for your in-store and online customers.
Creating top-of-mind awareness during holidays is an excellent strategy considering many customers may presume you’re closed for the holidays. But when they know you’ll stay open, your business will be their first destination when they want holiday services.
Create Fun Holiday Events and Rewards
In keeping with the classic American holiday spirit, be sure to make your customer’s shopping experience fun and lavish. Leverage incentive marketing strategies, such as holiday gift cards, holiday price discounts, buy one get one free, and free holiday shipping.
The goal is to make your customers feel like you care about their holiday preferences, ensuring they genuinely enjoy shopping with you. Plus, you don’t have to spend a lot of money to invest in the customer experience. Making your customer’s holiday shopping experience engaging and memorable may be enough to turn a one-time holiday shopper into a loyal customer.
How Resourcing Edge Can Make Your Holiday Operations More Effortless
To make the most out of the holidays you choose to stay open, you need a solid strategy to ensure everything runs smoothly. Be sure to get ahead of managing your holiday payroll, seeing you’ll almost always have to hire extra staff to manage bulking holiday workload.
And this is where Resourcing Edge comes in. When you partner with us, we’ll customize holiday payroll solutions to ensure you pay your staff their deserved holiday pay on time. This way, you’ll keep them happy and also keep most of your holiday revenue.
On top of that, we’ll advise you on human resource (HR) best practices for managing extra holiday staff, rewarding your existing workers to encourage them to embrace holiday work enthusiastically.
Contact us today, and let us help you organize your holiday operations more effectively.