While outdoor retailer REI may be closing its doors on November 27, there’s no opting out of the fact that the holidays are coming, along with a major surge in retail. On Black Friday 2014, during a season that saw retail holiday sales nationwide increase by 4% (according to NRF.com), Quiet Logistics experienced thirty times our typical order volume. This year, we’re anticipating an even larger bump over the daily average. And that’s just in one day. Holiday sales now span the period from October through December, with redemption of gift cards pushing all the way into January, making for several particularly busy months in the warehouse, in stores and at headquarters.
Especially with an increasing percentage of sales transactions occurring online, it’s vital to deploy a logistics plan that will enable fulfillment of all these additional orders with the same level of service, speed and accuracy as any other time of year. If you haven’t already started gearing up for the peak season that will hit in a few weeks’ time, or if you want to confirm you’re adequately prepared, be sure to consider the following:
1) Manage Suppliers Closely
A happy holiday season requires ample product waiting in the warehouse, ready to be shipped out to eager customers. The last thing you want are production delays putting a crimp in the plan. Unfortunately, the likelihood of late deliveries increases during holiday crunch time, when factories and manufacturers are at their busiest. To minimize this likelihood and improve the odds of receiving product when you need it, make sure there’s clear, direct communication up and down the supply chain. Stay on top of your purchase orders; don’t fall off the vendor’s radar or allow other orders to get prioritized ahead of your own. You can also work with your logistics provider to help with vendor compliance, making sure that product is delivered as promised.
2) Make Contingency Plans
During the holiday rush, the best-case scenario doesn’t always pan out – production deadlines aren’t always met, and some delays are inevitable. (Take, for example, the 2014 labor disputes that impacted West Coast ports.) Instead of despairing and resigning yourself to late products, assess alternate ways to make up for lost time and get your inventory in as quickly as possible. If it’s too late to ship by sea, look into the possibility of air freight – the increased shipping costs may balance out against product availability for holiday sales. Aligning with a logistics partner with strong carrier relationships can also help keep costs down and secure capacity at a time when cargo space is at a premium. Flexible shipping options empower you to make adjustments as necessary to avoid logjams and maintain optimal efficiency – a plus all year round, but especially at the holidays.
3) Tap Technology for Best Results
Integrated technology solutions can have a revolutionary impact on handling the holiday surge, from more accurately predicting demand to expediting picking and packing far beyond what can be done manually. For example, our QuietView software enables us to track inventory in real-time, staying on top of order status continuously and accumulating data that can be put to work in both immediate and future planning. Our automated warehouse systems streamline the traditional approach to picking product, meaning that each order can be filled in a fraction of the time – always a valuable efficiency, but particularly so at peak times like Black Friday, Cyber Monday and the Christmas holiday.
4) Bring in Extra Person-Power
Just as you wouldn’t pull off a pop-up shop or open a new store without extra staff, you don’t want to enter the holiday fray without a boost in your fulfillment force. The sheer increase in orders is enough to strain the day-to-day infrastructure – that’s why we amplify capacity by bringing in seasonal workers in our own warehouses. Whether adding staff to fulfill orders or extending your customer service team, factor in time to recruit and train these part-time workers so they accurately represent the brand, know the product and are fluent in customer interactions. This extra person-power is an important complement to technology, lending a human touch to premium orders and enabling clients to include value-added components to holiday gifts.
5) Offer Expedited Shipping and Other Promos
While part of the holiday challenge is meeting demand, another critical factor is keeping up with, and standing out from, the competition. One highly effective way to do so is by offering free shipping as an incentive to spend more online. (According to NRF.com, in 2014, free shipping offers were significant inducements to shop via ecommerce sites.) Another is by offering expedited, guaranteed holiday delivery to ensure customers their gift will arrive on time. Work with your logistics team or carrier to determine the best, most cost effective ways to implement such holiday promos, and be sure to extend the discussion with your marketing team to communicate such promos clearly and effectively to the customer via online and other channels.
6) Prepare for Returns
Outgoing orders are only half the equation, and any robust logistics strategy needs to include a forward thinking approach to returns and exchanges. Customers expect refunds to be made quickly and without hassle; this means you may want to include a return label for free shipping along with clear instructions for repacking and sending the item back, as well as a straightforward policy outlining conditions for returns. It also means there needs to be a process in place for restoring returned product to its first condition, and preparing it to be sent out again. It can also mean replacing that returned item with an exchange for a different size, color or style – an action that must be completed with as much speed and accuracy as the original order in order to retain the customer.
7) Think Ahead to Holiday 2016
As you go through the Holiday 2015 shopping season, be sure to look around and assess ongoing activities, making immediate adjustments but also thinking ahead to more comprehensive or strategic improvements that can be implemented next year. Many logistics providers and operations teams start getting ready for the surge as early as summer, from forecasting upcoming sales trends to hiring seasonal support staff to prepping fulfillment equipment and facilities. Give yourself ample lead-time to get all the elements organized for an increasingly busy, mission critical season.