Supply Chain Tactics to Survive Black Friday
According to the National Retail Federation (NRF), more than 185 million people are expected to shop over the five-day Thanksgiving weekend. This time can be a stressful time for retailers and the transportation industry, and the days between Black Friday and Cyber Monday are typically the peak period of the rush. Massive volumes of e-commerce purchases are putting more and more pressure on business and logistics managers each year. Whether your business manages your supply chain in-house or uses a 3PL partner, supply chain planning in peak seasons like this requires the use of supply chain industry best practices.
The Origin of Black Friday
The term “Black Friday” was first associated with financial crisis and shopping sales. Jim Fisk and Jay Gould, two wall street financiers, bought a significant amount of US gold in the hope of the overall price soaring and turned to be able to sell it for massive profits. On Friday, September 24, 1869, in what became referred to as “Black Friday,” the US gold marked Crash and Fisk, and Gould’s actions left Wall Street barons bankrupt. In the later years, the post-thanksgiving period became associated with the name.
Although this is the origin story, there is one black Friday tale that also attributes to its name. When stores recorded their accounting details, they noted profits in black and losses in red. The story goes that many shops were “in the red” throughout most of the year. Still, they later “went into the black” the day after Thanksgiving when shoppers bought a significant amount of discounted merchandise for the holiday presents.
Supply Chain Best Practices for Holiday Shopping
Use your 3PL’s Value- Added Services
Black Friday and Cyber Monday are the times of year that your third party logistics provider will become an extra benefit to your business. Using value-added services such as kitting and packaging to prepare high-demand items ready to go, and kit pre-package many of them in preparation for holiday shoppers. A 3PL can typically also provide temporary storage overflow inventory for the peak seasons.
Take Care of Your Employees.
The holiday season is the worse time to lose employees. Due to to the high-stress environment of a warehouse or fulfillment center and the longer holiday hours, this time of year is at high-risk for employee turnover. This is not a time to slack on your promise to company culture. Try and keep the work environment as light as possible and maintain open communication by having conversations with employees to make sure they feel appreciated during such a critical time for logistics.
Peak season is not the time of year when your system can go down; all systems must be running up to speed. During the Black Friday/Cyber Monday period, your order management, distribution, allocation, replenishment, and financial systems will be subject to a level of transactional activity that can be many orders of magnitude higher than ever before.
Employee training throughout the year is critical so that they can jump into whatever role might be the most in-demand during the holiday peak season. Not only does routine training empower your workforce, but it also improves team morale.
Focus on Customer Experience
While optimizing supply chain efficiency with standardized processes and automation, supply chain professionals should focus on the customer experience. Customers gain trust in businesses that can handle the busiest of shopping days.
Statistics/ Trends According to NRF
People ages 18-24, 88% t say they are likely to shop and particularly enjoy the social aspect. Similarly, 84% of those ages 25-34 plan to shop. That compares with 69% of holiday shoppers overall.
Of those planning to shop, there is an almost even split of people who plan to start their shopping in-store 47% compared with those who plan to start online 41%. Those under 25 are even more likely to say they expect to start shopping in-store 52%.
The top reasons consumers are planning to shop include:
65% The deals are too good to pass up
22% It’s when they like to start their holiday shopping
21% It’s something to do over the holiday