Ecommerce companies must anticipate peak sales volumes and troughs throughout the year, as well as deal with stock management during times of great activity and quietness.
The popularity of online shopping has increased in recent years, owing to Covid-19’s restriction on customers’ ability to visit stores across the world in person.
Of course, this increase in online purchases is music to the ears of eCommerce specialists, provided you’re ready for the rush.
In an ideal situation, you already have and continue to develop a strong supply chain that is both long-term and scalable, as well as safeguard your supplier relationships while also protecting your customer connections.
A lengthy supply chain ensures that your goods arrive at your warehouse(s) before being purchased by clients and delivered to them swiftly.
Unfortunately, the global supply chain was one of the many victims of Covid-19.
The disruption to the regular operating procedure is still felt by both buyers and sellers, despite the fact that there have been viral outbreaks on vessels, staffing shortages at ports, and other factors.
The break in the global supply chain has resulted in empty store shelves and warehouses, as well as significant delays in delivery times, which is expected to last throughout the 2022 holiday season.
Consumers are more unpredictable, stockpiling packages of toilet paper, anyone, This makes forecasting more difficult than ever before.
Fortunately, this change isn’t the end of the world or your business.
According to the adage, “Success is found when preparation meets opportunity.” It’s time to get ready for the 2022 holiday season by preparing yourself for bigger sales.
Find out what’s in store
We’re not only talking about your inventory here (which is crucial, by the way).
You need to be prepared for any peak season, from Halloween through Black Friday, Christmas and New Year’s Eve, Easter, grading season, and every parent’s favorite:
- The back to school.
- Peak seasons include holidays and other seasonal waves of sales or higher than normal demand for particular products.
During peak seasons, you may experience additional shortages in your supply chain.
The following are four supply chain concerns that have the potential to occur:
It’s easy for everyone in the supply chain to feel stressed when volumes rise, and miscommunications occur during those frantic times.
A single error in communications at any point along the supply chain may bring everything to a halt and, worst of all, result in a negative buyer experience.
2. Inventory/Stock Shortages
In theory, inventory scarcity is the most manageable problem of the lot, since it happens most frequently during peak seasons.
Seasonal trends and must-have products differ from season to season, with many of them being unavoidable due in large part to the demand for them increasing while suppliers or manufacturers are unable to keep up.
3. Abnormal Losses
Theft in the supply chain is a problem that has no borders, but it becomes more acute during peak periods.
Expect and prepare for additional losses during peak seasons, whether it’s because of porch pirates trying to steal a package from its intended location, or sophisticated thieves targeting delivery vehicles and cargo lots.
4. Shipping Delays
Despite the fact that you have the greatest fulfillment partner, delays in delivery may cause significant issues for your supply chain at any time of year.
During the holidays, they’re more common because people ship gifts to family members both domestically and internationally.
Delays in shipping can result in orders being canceled and payments being reversed if shipping deadlines, such as two-day delivery, aren’t met.
The good news is that any of these problems creates a huge logjam (and a pain in the rear) for you and your company, but the risks can be reduced to keep your business and supply chain functioning smoothly.
Make a plan ahead of time
Even the most popular peak seasons and holidays, such as Christmas, follow the same calendar year after year, allowing you to plan ahead and be as well-prepared as possible.
Ideally, planning should begin at least a quarter before your busiest time.
That’s why we see Christmas presents in shops before Halloween has come and gone; if you don’t get it early, you may not be able to obtain it at all!
1. Inventory Management
Managing your inventory turns and planning for your busiest (and not so busy) periods are 2 of the most crucial aspects of any online business.
Automated inventory management can prevent you from having high-stock or out-of-stock situations and maintain your fulfillment process smoothly.
To properly handle your inventory, you should cycle through your counts on a regular basis, with weekly and monthly inspections and quarterly physical counts to avoid unpleasant surprises.
To ensure that you can meet every order that comes in, increase the amount of stock on hand for your most popular products (which will change with seasonality and holidays) as you enter into busy periods.
2. Suppliers and Secondary Sources
A crucial component of your inventory management is selecting high-quality and trustworthy suppliers.
The arrival of your company’s inventory at its warehouses (or distribution centers) is the bottom of your supply chain funnel.
If things don’t work out as expected here, you’re in huge trouble for the remainder of the trip.
When it comes to maximizing your revenue, there’s a lot more involved than just finding the goods you want to sell and a reliable supplier.
Communicate clearly and make them aware of any spikes in stock demands during peak periods.
If a natural disaster shuts businesses and damages homes and infrastructure, you may need to turn to alternative providers to fill gaps and support your company during this time.
Before you sign a contract, do your homework and thoroughly investigate each vendor.
3. Look for a trustworthy fulfillment partner
What if you want to deliver something from Hawaii to Alaska? Would it be possible in two days? Good luck with that!
This is where a dependable fulfillment or third-party logistics (3PL) partner can assist you.
Fulfillment partners take away the guesswork and risk of shipping on your own, allowing you to focus on marketing, sourcing items, and selling more!
A trustworthy fulfillment partner is an important component of your supply chain because it assures that your consumers’ expectations are met.
4. Look to the future with this cycle prediction.
If you experienced Christmas in July, just imagine how hectic the real holiday will be.
Seasonality can be a valuable tool for business planning, but it’s important to plan ahead of time by considering data from prior years to avoid being caught off guard.
5. Hit the (Accounting) Books
Are you preparing for when things get hectic?
Sure, there are extra expenditures associated with selling more, such as higher costs for the services that keep your business moving forward.
But it’s crucial not to overlook the hidden expenses of these hectic times.
Costs are increasing for customers across all industries, in part, owing to the current state of the global supply chain.
Covid-19 has had an impact on demand for items in the last 2 years, pushing up demand while supply constraints persist throughout the world’s labor shortages and supply chain problems.
When demand rises and supply stays constant, costs for your most popular items are likely to rise.
If you don’t want to burden your clients with these costs, the best thing you can do is, as previously stated, plan ahead and budget appropriately.
6. Forecast your customer behavior
It’s difficult to know how customers will act, but looking at your previous year’s (or peak season’s) data might help you understand how your buyers behaved and prepare.
Customers’ behavior changed significantly in 2021, with a 50% year-over-year increase in internet buying.
This year, online shopping is expected to be even more popular.
However, your company’s data will determine what items you will most likely offer or what the typical order might look like.
Have you been receiving a lot of requests for knickknacks lately? Maybe you sold more books than you had in the past.
Take a look at which products you’ve sold in greater quantities over the previous year and compare it to the past (and even prior years) to see patterns.
Look at your current peak sales window and draw inferences if you don’t have a previous year to guide you.
You can anticipate to need to double your in-stock inventory leading into peak seasons if you know that your clients’ orders have increased in size over the previous several holiday seasons.
What Should You do if you are Overwhelmed? (Which is not your fault)
As your company grows larger, the issues you face become increasingly complicated.
When you reach this stage, you must hand over control to the specialists so they can assist you in growing your online business while keeping your focus in your business growth only.
We here at Free cash flow, helping online businesses (like your business) to boost their revenue and doing what other firms miss.
I know you’re anxious about not receiving as much as you had hoped, but believe me when I tell you that we exceed your expectations.
Move your online business to the next step NOW and book a free consultation callwith Alan Chen, CEO of Free cash flow