How the Holiday Season Affects Supply Chain and Your Business

How the Holiday Season Affects Supply Chain and Your Business

The holidays are approaching and customers are flipping through catalogs, collecting gift cards, and placing products on their online wish list. While it is awesome to see the uptick of sales orders that lead to higher profits, the holiday season can be an absolute nightmare for supply chains everywhere. Meeting deadlines, shipping merchandise, and keeping track of invoices can become 10 times harder during this busy season. In this post, we will look at several factors that can lead to unnecessary stress and complication and the best ways to help you gain a competitive advantage this holiday season.

Holiday Factors Affecting the Supply Chain

Early Season Shoppers

Every year it seems like the holiday season is starting earlier. Shoppers are looking for the best deals and available products back at the beginning of fall, causing a strain to your inventory before the large shopping days in November and December. If you aren’t prepared, you can find your merchandise stretched thin and your vendors unable to keep up with orders to supply you with the items you need to properly restock shelves during the big shopping events.

Predicting Customer Demand

What you think will be the hottest holiday gift turns out to be a slow mover in your business. On that same token, a slow inventory product suddenly trends in a big way, forcing you to dust off boxes and check inventory to see if you can meet rising customer demands. Having empty shelves significantly affects your company’s bottom line, as every competitor is facing the same challenges of maintaining stock levels for the same desired products.

Communication Issues

Suppliers, manufacturers, and third-party logistics companies are all striving to keep every business client happy during the holiday season. Yet it only takes one changed invoice and missed communication to cause havoc with your supply chain. You are struggling to keep up with orders while wondering where a shipment is or receiving the wrong shipment. Logistics companies are trying to play catch-up with the changes as suppliers and manufacturers are trying to get the right products on shipping trucks.

Weather-Related Problems

Your supply chain could be running on schedule until the weather reports predict a large storm system is on the way that has the potential to shut down operations for your suppliers and distribution centers. There is no way to predict when such disruptions will strike and which vendors it will affect, leaving you scrambling to make other contingency plans. You also have to deal with longer deliver times and customer complaints for products.

Disruptions to Vendor’s Supply Chains

While your supply chain may be on track for the holiday season, there can be significant disruptions to your vendor’s supply chain with their manufacturers. Factories can close, limit production lines, or send fewer shipments that can put a strain of your vendors. If you rely only on one source, you can see significant issues that will soon slow down your own supply chain capabilities.

Preparing for the Holiday Season

While it would be ideal to have everything work out perfectly every holiday season, being prepared for issues to your supply chain will allow you to understand the risks and create the appropriate contingency plans to lessen the number of disruptions that seriously impact your business. It becomes vital for you to maintain proper vendor management to source the products you need from the right manufacturers and suppliers who can meet the requirements of your business, even during the busy holiday season.

Before the big holiday shopping days arrive, evaluate your supply chain and make the necessary modifications you need to find the right vendors. Communicate your needs early, and gain a better understanding of the vendor’s supply chain to work out a holiday product supply plan that appeals to everyone. Then have the products you need to meet rising customer demands.