Managing Order Fulfillment and Demand Planning on Holidays
By Cat Dewinta - September 15, 2023
The holiday season is a season of buzz and rush. More people are shopping, traveling, and celebrating than usual. Christmas shopping in the Philippines is one of the busiest events of the year. But for businesses, it can be tough if they’re not ready. Businesses have to ensure by planning that there are enough products to sell and be able to deliver them on time. This is called demand planning and order fulfillment. To do well during this season, companies need a strong plan for what to sell and how to deliver it. This in turn will definitely meet the needs of their customers and makes the most of the holiday season.
Knowing How Holidays Affect Demand
Before we talk about demand planning and order fulfillment, let’s understand first how consumer patterns are shifting this holiday season. Based on the latest report released by Philippine Statistics Authority, consumer spending in the Philippines is expected to increase by 20% each 4th quarter, increasing 46% for malls and commercial businesses revenues. The expected numbers of domestic trade has proven increased by 1% to 5.79 million tons. Typically encompassing Thanksgiving, Christmas, and New Year’s, the holiday season elevates shoppers’ spirits. People are busy looking for gifts and discounts, mostly they are mostly attentive to the latest trends that basically boost store sales during these periods. This change in shopping behavior is important for businesses to grasp because it affects how much of each product they should have in stock and how quickly they need to deliver orders. So, let’s explore these changes and how they impact your business strategies.
Seasonal Demand Fluctuations
The Christmas season typically witnesses a significant spike in consumer demand. Retailers often experience a surge in sales, especially during key shopping events like weeks leading up to Christmas and New Year’s Eve.
Variability in Product Preferences
Consumer preferences during the holidays can vary greatly from the rest of the year. Shoppers are on the lookout for special deals, gift items, and seasonal products, which can significantly impact your inventory and SKU assortment.
Last-Minute Shopping
Many consumers procrastinate when it comes to holiday shopping, resulting in a rush of last-minute orders that must be fulfilled promptly to ensure customer satisfaction.
Multi-Channel Shopping
With the rise of e-commerce and omnichannel retailing, customers expect a seamless shopping experience, whether they are browsing in-store or online. This complexity adds an extra layer of challenge to order fulfillment.
Demand Planning for the Holiday Season
Demand planning is the cornerstone of a successful holiday season strategy. Here’s how to tackle supply chain management during ber months:
Historical Data Analysis
Analyzing past data will help businesses find the right balance to how much is needed to produce for the anticipated surge of demand on holidays. You can learn a lot from the data of previous holidays. You can see which products were the most popular and sold the most. This can help you decide how many of each product you need to have in your store.
- Identify trends in product sales: By analyzing historical sales data, businesses can identify trends in product popularity. This information can then be used to forecast demand for specific products during the holiday season.
- Understand the impact of external factors: External factors such as weather, economic conditions, and cultural trends can also impact holiday demand. By analyzing historical data, businesses can better understand the impact of these factors and make more accurate forecasts.
- Segment customers and target marketing campaigns: Historical data can also be used to segment customers and target marketing campaigns accordingly. For example, a business can use historical data to identify customers who have purchased specific products in the past and target them with relevant marketing messages.
Advanced Forecasting Tools
Through the use of advanced forecasting tools like computer programs that utilize statistical and mathematical models, business would be able to predict future demand. Unlike the usual forecasting for regular days of operation, it is valuable because it enhances the precision of demand predictions for holidays. This improved accuracy, in turn, assists businesses regarding inventory, pricing, and marketing decisions. Businesses are caught between avoiding running out of stock and having too much inventory. You can also adjust your plans based on changes in the market or customer behavior.
Collaborative Demand Forecasting with Key Players
Another important consideration for a smooth holiday season is to work closely with your stakeholders. Effective communication is key in this collaboration. Consider the inputs of key stakeholders, including suppliers, manufacturers, and distributors, in the forecasting process. This coordination ensures a steady and reliable flow of inventory. This coordination is like music to your ears because it helps match your supply with the anticipated demand during the holiday season.
Scenario Planning
In essence, scenario planning is your safety net during the holiday rush, especially for small businesses that are new to the scene. It’s about thinking ahead, anticipating challenges, and having a plan in place to ensure smooth sailing, no matter what surprises the holiday season may bring.
Inventory Optimization
Implement inventory optimization techniques such as safety stock levels and just-in-time replenishment to minimize carrying costs while meeting demand.
Order Fulfillment Strategies for the Holiday Season
Now that you’ve got your demand planning down pat, let’s delve into the crucial world of order fulfillment during the holiday season. Here are some key strategies to help you sail through this period smoothly:
Efficient Warehouse Management
Think of your warehouse as the heart of your operation during the holidays. Optimize its operations by organizing your stock for easy access. Consider hiring seasonal staff to handle the increased workload efficiently. Implement streamlined picking and packing processes to get orders out the door swiftly.
Real-Time Inventory Visibility
Imagine you’re a customer ordering a special gift for the holidays. You want to be sure it’ll arrive on time, just as promised. Real-Time Inventory Visibility ensures you can make that promise with confidence. You can see exactly how many of those special gifts are available in your inventory, and you know that as soon as they’re gone, you won’t accidentally sell more than you have.
Multi-Channel Integration
When your business uses different ways to sell stuff, like online, in stores, and more. It’s like making all these ways of selling work well together, so customers have an easy and consistent shopping experience.
Last-Mile Delivery Solutions
The last mile of delivery can often be the most challenging. Collaborate with reliable last-mile delivery partners to tackle the surge in shipping orders. Offer flexible delivery options such as same-day or express shipping to cater to those last-minute shoppers who just can’t wait.
Customer Communication
It’s like the friendly, helpful conversations you have with your customers. Keep your customers informed about their orders – their status, expected shipping times, and any potential delays. This makes them trust you more and want to shop with you again and again.
Remember, order fulfillment during the holiday season is like conducting an orchestra. Each strategy plays its part in creating a harmonious and delightful shopping experience for your customers. So, fine-tune your warehouse operations, keep a keen eye on inventory, harmonize your sales channels, nail that last-mile delivery, and keep the lines of communication open. With these strategies in place, you’ll not only meet but exceed your customers’ expectations during this festive season.
Challenges and Solutions
While demand planning and order fulfillment are essential for holiday season success, they come with their fair share of challenges. Here are some common hurdles and solutions:
- Inventory Management Challenges: Managing fluctuating demand and SKU assortments can be challenging. Consider employing demand sensing technology to improve inventory accuracy.
- Peak Season Labor Shortages: Seasonal labor shortages can hinder order fulfillment. Plan ahead by recruiting and training seasonal staff well in advance.
- Supply Chain Disruptions: Supply chain disruptions like shipping delays can occur. Diversify your supplier base and consider alternative transportation methods to mitigate these risks.
- Returns and Exchanges: Expect an increase in returns and exchanges after the holiday season. Have a clear returns policy and process in place to handle these efficiently.
Logistics Companies you can rely on for delivery during the Holidays
For motorcycle deliveries, delivery service providers can transport your goods, documents, or parcels to the destination on the same day they are picked up even during holiday rush. Here are some of the known providers in this kind of service:
If you need a trucking service that is best for transporting your large cargo to wider locations, you can also rely on the listed trucking logistics providers below. These are some of the leading companies in the trucking logistics industry:
Another is a list of express shipping or courier service providers that will ensure your parcels will arrive on time during holiday season:
Paying attention to demand planning and order fulfillment should be the first priority of businesses in order to achieve successful logistics operations during the holidays. The unique dynamics of the market as well as managing demand and supply expectations, both businesses and customers can go hand in hand. Employing advanced forecasting techniques, optimizing your inventory management, and streamlining your order fulfillment processes, you can not only meet but exceed customer expectations. With careful planning and execution, your business can enjoy a profitable and joyous holiday season year after year.
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