It’s beginning to look a lot like Christmas and for retailers that means the busiest period of the calendar year, and for some, a turbulent time as supply chain challenges continue to wreak havoc globally. Production disruptions, delays and stock shortages have caused mayhem for many businesses, and continue to do so with an estimated 69% saving their Christmas shopping for Black Friday, in a bid to secure the best prices amid the cost of living crisis. This leaves just one month until Christmas Eve to fulfil orders to ensure they arrive in time and adds even more pressure to already-struggling retailers.
According to an annual study by Coupa Business Spend Management, 83% of supply chain professionals across the UK and US believe supply chain disruptions will negatively impact revenue throughout the festive season, causing losses of up to 30%. The study also reports that 9 out of 10 businesses are worried about hitting sales forecasts and 77% anticipate product shortages with many already seeing out-of-stock items on their shelves.
The statistics certainly make for stark reading, but as a retailer, how do things hold up for you, and how can you proactively manage disruptions throughout this busy period? We have put together some last-minute tips to help you manage the Christmas season, which is also dubbed ‘the golden quarter’.
Sales over the festive period are hard to predict, with some suggesting sales will be lower due to the ongoing cost of living crisis, whereas others believe consumers will throw caution to the wind and get swept up in the festivities and splash out. When it comes to implementing supply and stock strategies, you need to make decisive decisions and stick to them with regards to promotions, discounts and payment plans if you wish to try and lure customers – if they don’t work, you can always amend them, but don’t delay in making these decisions.
82% of retailers this year are reportedly hiring temporary workers to help meet demand, and those hiring intend on increasing their current workforces by 28% using temporary staff. It’s not too late to hire some last minute, temporary workers if you are struggling to manage your workload or anticipate a busy Black Friday.
The success of inventory management comes down to your ability to track stock movements, and therefore this level of visibility and transparency is crucial, particularly for fast-moving, seasonal peaks where demand is high. Inaccurate stock data tracking stock levels and value will hide issues in your supply chain and may result in failing to locate stock, if the incorrect location is stored, or an inability to fulfil orders if the recorded stock levels are incorrect. Being able to highlight problems early can help you overcome them before they have a significant impact, and accurate data can help you streamline your processes and implement strategies to maximise sales.
Standardising warehouse and fulfilment processes can improve optimise storage and handling and create long-term efficiencies to eliminate errors and reduce touchpoints that can impede speed. Research by Advanced Supply Chain found that 57% of businesses were focusing on streamlining warehouse processes this year in a bid to cope better with peak demand periods.
The challenges in recent years have highlighted the vulnerability of supply chains, and in particular the risks of single source strategies, which stress the need for contingency planning and numerous suppliers. Negotiating with multiple suppliers across different locations will reduce risks of failing to supply products and therefore the inability to fill your shelves and fulfil customer orders.
It’s important to remember that the peak demand period doesn’t stop at Christmas so don’t let your guard down too early. A second wave often comes with post-Christmas sales, and there can be a busy period of returns after the festivities of unsatisfied products. Managing returns and refunds quickly, and easily for the customer will help ensure they continue to shop with you in the future, whereas a slow and complicated process may send them to a competitor.
Christmas shopping is in full swing and with it brings a host of supply chain challenges for retailers, with the vast majority saving their shopping for Black Friday to secure better deals, it leaves little time for retailers to fulfil orders. It highlights the need to have full visibility and transparency into your inventory, including stock location and value so you can implement appropriate strategies and drive efficiency. Standardised processes and fast decision making are also crucial for supply chain success, and a good supply chain software can help achieve this.
For more information about how Pegasus Software can help you manage your peak demand periods with success then please contact us today for a chat.
Posted On: November 16, 2023
