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How to avoid supply chain disruptions during the festive season

The holiday season has arrived, and retail businesses must balance several things including fulfilling many orders, maintaining an adequate workforce, logistics, efficient and timely last-mile deliveries, and frictionless returns/exchanges/refunds.

In this article, we’ll examine a number of variables that may cause unneeded stress and complications as well as the best strategies for giving you a competitive edge this festive season.


Preventing Supply Chain Disruption

Problem: Predicting customer demand

Anticipating customers’ demands surrounding the gifting season can take a lot of work. The items that were a big hit last year may sell differently than this year. A slow inventory product suddenly trends quickly, forcing you to dust off boxes and check inventory to see if you can meet rising customer demands. Hence, it is now more crucial than ever for manufacturers and suppliers to collaborate and react quickly to market volatility.

Solution: Put demand forecasting strategies into practice

An end-to-end sales order management solution can help you project future sales using past sales data. Opt for short-term as well as long-term demand forecasting methods. Manage your just-in-time supply chain with the aid of short-term forecasting. By looking at short-term demand, you can modify your projections depending on current sales information. It gives you the ability to react swiftly to changes in customer demand. At the same time, your long-term forecasting will enable you to control the direction of your company’s growth by planning your supply chain operations, marketing campaigns, and capital expenditures.

Problem: Disruptions to vendor’s supply chains

Although vendors actively try to deliver goods on time, they may experience unpredictable disruptions. You can receive fewer products from your suppliers as a result of factories closing, cutting back on output, or sending fewer shipments. If you solely rely on one provider, you will quickly run into serious problems that will hinder the efficiency of your own supply chain.

Solution: Develop a wider range of suppliers 

Diversifying sourcing areas is a powerful tactic that businesses might consider. Nearshoring or bringing the supply chain closer to home is an alternative method. This may be a valuable strategy for diversification while lowering geopolitical concerns. As transportation times and costs are cut, the supply chain’s dependability may also be increased. Businesses can further benefit from purchasing software that accurately performs supplier analysis, enabling intelligent decision-making.

Problem: Early shoppers

The holiday season seems to start earlier each year. Early in the fall, shoppers are scrambling to find the most incredible offers and products still on the market, placing a strain on your inventory before the busy shopping seasons of November and December. Ecommerce revenue is expected to reach $224.31 billion during the holidays in 2022. This means businesses must ensure they are not understocking for the holiday season.

Solution: Stock up on time

An immediate strategy that you might consider using is ordering more goods earlier. Where and when it is practicable, order merchandise earlier to offer protection against delays already being felt throughout the supply chain. With the help of inventory management software, you can manage the large volume of inventory and make more anticipated holiday inventory purchases to accommodate the increased demand.

Problem: Labor shortage

Your staff is bound to take leave of absence around and during holidays. However, improper workforce management can lead to a labor shortage. For instance, the lack of floor managers and warehouse personnel can lead to bottlenecks in the order fulfillment process.

Solution: Employee management and training

Mitigate the impacts of labor shortage by adequately planning your human resource. You may offer additional benefits such as incentives, overtime pay, or paid vacation days to encourage employees to work during the holidays. Retailers can also establish upskilling training programs that empower staff to adapt to new trends effortlessly. Maximizing the efficiency of existing staff is preferable to hiring and training new employees.

Problem: Lack of automation

Dealing with the vast number of customers during the holidays is already stressful for retail employees. The added difficulty of manually managing inventory and processing orders can lead to errors and oversights. Businesses need to establish automated workflows for time-wasting processes, allowing employees to spend more time forecasting, analyzing trend data, and improving customer experience.

Solution: Make use of technology

The use of real-time data analytics and the use of Internet-connected gadgets to track shipments are just two examples of how technology might help ease supply chain woes. Many businesses are tackling labor shortages and enhancing efficiency thanks to recent investments in retail POS software, cutting-edge warehouse management systems, and finance and accounting platforms, ultimately lowering costs and improving performance. Although the near-term benefits are probably modest for businesses starting on this path, retailers who disregard technology do so at their own risk.


Gear up before the holidays!

Even though it would be great for things to go well during every holiday season, being ready for supply chain problems can help you identify the risks and develop the necessary backup plans to decrease disruptions that can negatively impact your company.

DEAR Systems has professionals who can explain more about our automated inventory management software and help you stay ahead of the supply chain disruptions this holiday season. Give us a call now to know more.

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