10 Holiday Inventory Best Practices to Stop You From Over-Ordering, Stocking Out, and Losing Orders
October 30, 2019
The holiday season is, as they say, the most wonderful time of the year – especially for ecommerce retailers. As total sales during this holiday shopping season are forecasted to hit $136 billion in the US alone, it is a great opportunity for your business to enjoy a piece of the pie.
So, how do you ensure your business is prepared for the increased demand? What steps can you take to keep your customers happy? Here are some best practices to help your business succeed over the holidays.
The best time to plan is now
The holiday season has a tendency to creep up quick (see the data), and it oftentimes leads to challenges with inventory management. If you are not prepared for the holiday sales spike, it can lead to frustrated customers and a loss in potential revenue. Fortunately, there are a lot of things you can do now to better prepare for the holidays.
Holiday inventory management best practices
There is no one-size-fits-all method for holiday planning, but there are ways to mitigate errors during the busiest time of the season:
1. Reach out to your suppliers
As demand significantly increases over the holiday period, it is important to let your suppliers and vendors know in advance. Share information on predicted order volume to make sure you order enough to avoid potential stockouts. Like you, they also need time to successfully deliver orders.
2. Make orders in advance
Using historical inventory data like SKU performance, you will likely have an idea of what will be your top sellers, which will help you make better estimates before ordering more inventory.
But if you are a newcomer, simply doing some online research, including social media, can help you get a grasp on what items in your store are in high demand this season. From there, you can prepare a list of what to stock up on.
3. Mark your calendar
Avoid the holidays creeping up on you unannounced simply by creating calendar reminders. Do keep your organization in the loop, especially your marketing and ecommerce holiday ad teams, so they are prepared to run campaigns. Here are some of the 2019 holiday dates to make note of:
- Thanksgiving: November 28
- Black Friday: November 29
- Small Business Saturday: November 30
- Cyber Monday: December 2
- Christmas: December 25
To avoid overstretching, you might want to consider instilling a cutoff date for orders to be delivered by a particular holiday based on the carriers’ holiday shipping deadlines.
4. Set stock levels
Carefully planning inventory puts your business in a much more comfortable position to deal with the increased demand during the busy shopping periods. Once you have a gauge of what you need for the holiday period, there are easy ways to make sure your inventory never falls below that level.
If you’re working with a tech-enabled 3PL or use inventory management software, tracking stock levels and automatically setting reorder notification points is a valuable tool. During the holiday season, it is recommended that you increase reorder points and your reorder quantity to cover a spike in sales.
5. Order holiday package inserts
The holidays are an exciting, joyous time of the year. Your packaging should be, too. Look for something that will delight your customers when they receive their package, and if your packaging is recyclable, even better.
6. Run inventory audits
To maintain inventory accuracy and to ensure you always have enough stock at any time, you may want to conduct inventory audits more often during this busy season. Inventory audits can be done in-house or by a third-party like a 3PL, and it can be as simple as conducting more frequent spot checks.
7. Have time to spare
All good plans buffer for unpredictable variables. With that in mind, it’s important to prepare for the holidays well in advance. The holiday season is hectic for everyone, which means that packages could take far longer to reach your customers, your inventory could be delayed, and your audits could become more tedious. Do your best to avoid some of the biggest holiday mistakes ecommerce businesses tend to make.
8. Implement inventory management
Keeping track of your stock, whether you run a single-channel or omnichannel business, is vital – especially during the holidays. Thankfully, these days an inventory management software like TradeGecko does most of the work for you: keep your business running as usual and save yourself from having to deal with inventory stockouts or over-ordering.
9. Speed up shipping with a 3PL
These days, 3PL (third-party logistics) provide a full suite of fulfillment services, including warehousing, packing, and shipping. If your business is growing and you’re ready to graduate from shipping out of your own home, it might be time to switch to a 3PL like ShipBob.
10. Monitor inventory closely on holidays
Keep a lookout for your inventory numbers on Black Friday, Cyber Monday and Christmas as these tend to be the busiest days for your retail business. Track how your inventory flows and take notes so you can make adjustments and improvements for next year.
When in doubt, let the pros help out
We appreciate and celebrate you for wanting to do as much as you can on your own. There comes a time, though, when reaching out is the best thing to do for your business. As industry leaders in shipping and inventory management, ShipBob and TradeGecko can empower your business to reach its full potential. After all, even Santa needs help.
While plans may not come to fruition exactly as they were drawn up, they really do eliminate inefficiencies and errors during peak sales periods.
You may not be able to predict everything, but by following some of the holiday best practices listed above, you are more likely to drive more revenue this holiday season.
To help you better prepare, The Ecommerce Retailer’s Guide to Preparing for the Holidays by ShipBob covers everything you need to know to have your best holiday season yet.