Christmas Supply Chain Management

Concept image, showing Santa Claus red legs and white fur trim trousers, and black boots, trapped underneath a white Christmas present box, bound in a red ribbon.

2D concept image of a white truck, with a big present as the cargo container, and a big present on a white background. Surrounded by 3 additional white present boxes, wrapped in red ribbon.The festive countdown towards the most wonderful time of the year, began when Black Friday ended, at the end of November. In turn, supply chains are now gearing up in the hopes of not only bringing joy to their customers, but also, to increase their profit margins. 

For both retailers and supply chains, Christmas is the busiest time of the year, and within the UK alone, consumers are expected to spend around £1bn throughout the festive shopping period. Due to big discounts, it is predicted that 57% of consumers finish their Christmas shopping during Black Friday, leaving just 43% remaining, to shop, before the big day.

Prior to Christmas, communication between trading partners and supply chains is crucial in preventing product shortages and avoiding late deliveries. By allocating enough supplies and evaluating supplier compliance against shipping tolerances, all inventory should reach its destination in time; and ensure optimum, operational, inventory stocks.

Distribution centres and warehouses have standard procedures in place, to prevent any misplaced items which can often hinder ordering, fulfilment and transportation costs, whilst negatively impacting profit; wasting time and costs on additional monitoring.  

Using in-depth and intelligent data analysis, retailers can gather structured and unstructured data, consisting of past sales figures, which, when analysed can be used to distinguish potential correlations, which in-turn, can help brands anticipate the big trends of the Christmas season for the following year. 

However, forecasting consumers’ behaviour, can be a rather unpredictable science when the festive season is in full swing. Best practice usually dictates that most retailers are expected to hold increased seasonal stock levels, with focus on their best-selling items, to maintain a high level of inventory accuracy, whilst simultaneously ensuring consumer satisfaction, meaning they leave neither their stores, nor their websites, empty handed.

Throughout the peak festive season, within both online and offline shopping, supply chains increase efforts to ensure that they can avoid late deliveries, which can sometimes result in lower profit margins and further charges for both themselves and retailers. When companies monitor their supply chains, and outputs match expectations, retailers, suppliers, and consumers alike, are kept happy.   

One ineffective stock management process can unfortunately also lead to extra pressure towards a distribution centre, as manufacturers will try to take care of any additional last-minute orders, which must be shipped in time. To avoid any such obstacles; companies must start to align priorities ahead of winter, with each given trading partner, to not only avoid delays, but to also anticipate and mitigate any possible unforeseen situations. These can include last minute delays or disruptions, which can immediately affect a Christmas action plan Supply Chain. 

Retailers must evaluate the suppliers in time, and set up cross functional teams within supply chain, risk management, and sourcing, to enhance visibility throughout operations and trading partners. Implementing short-term strategies can also help enhance performance and overcome supply chain unpredictability.

In the run-up to Christmas, ineffective management occurring anywhere along the supply chain, could cause unavoidable low stock levels, making retailers run out of highly desired products, leading to low customer satisfaction. 

The key to a successful Christmas is understanding what will be in demand and delivering it to the consumer. If the supply matches perfectly the demand, then companies can expect to achieve the desired profit margins for this peak season, consumers will not be left disappointed and companies achieve what they proposed. 

 

Share This Article

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on pinterest
Pinterest

Supply Chain and Logistics Specialists

Call us on +44(0) 1926 430 883​

Supply chain and Logistics Specialists highly experienced in all aspects of Supply Chain and Logistics Operations,
Distribution Network Strategy, Warehousing Operations, e-commerce Logistics and Warehouse and Distribution Centre Design.