In a world where customers are becoming increasingly demanding as a result of technological innovation, small businesses in particular are under a lot of pressure to optimize their supply chains so as to compete with the titans of industry.
This is especially true during the holiday seasons. Whether it’s Halloween, Thanksgiving or Christmas, smaller retailers are in a great place to serve last-minute shoppers who may need to purchase certain goods that would take too long to arrive via large online retailers, or are already sold out in the big-name commerce centers. It’s therefore important that these retailers have a means of ensuring that their inventories are accurately stocked and ready for whatever rush may lie ahead.
Before diving into some of the specific steps that small retailers can take to enhance their supply chain, it’s worth analyzing the unique hurdles facing the industry.
In early September, Hanjin shipping, one of the world’s largest trans-ocean cargo companies declared bankruptcy. At the time of the initial filing, many in-transit vessels were not allowed to enter port since tugboat operators and stevedores weren’t confident that the company would be able to pay them for their services.
“As a result, $14 billion worth of goods are languishing in a maritime limbo,” Salon contributor Angelo young wrote. He later added, “Suddenly, a slew of companies that have taken the shipping industry for granted are watching with concern.”
The real concern here is the effect that the recent bankruptcy will have on the upcoming holiday season for retailers.
“The woes of a South Korean shipper could affect what makes it under Christmas trees this holiday,” USA Today’s Mike Snider wrote. “The crisis for the shipper is creating ‘a ripple effect’ that could impact retailers’ shelves come the crucial holiday shopping season.”
It will therefore be more important than ever this for small retailers to make sure they’ve streamlined every controllable facet of their supply chain for the 2016 holiday season.
Here are a few places to get started:
1. Use supply chain management software
Today’s cloud-based, supply chain management software makes it possible for retailers of all sizes to track their inventories in real time, eliminating the risk of shortages sneaking up on them. Traditional inventorying systems would typically refresh once a day, which may cause confusion as you attempt to track down items that might still be listed in your warehouse as a result of the slow updating. With a modern supply chain management solution, you’ll not only have up-to-the-second details about your current inventory – you’ll also be able to track incoming deliveries for the sake of providing shoppers with an accurate estimated time of arrival for new shipments.
2. Choose suppliers wisely
To a significant extent, retailers are at the mercy of their suppliers, and sometimes even their suppliers’ suppliers. It’s therefore important that retailers conduct as much research as possible into what certain suppliers are capable of offering. For instance, Hector Rodriguez, president, Active Freight & Logistics, noted that “nimble manufacturing cycles” could improve time to market. This helps to ensure a steady, and more on-demand flow of goods for your business and its consumers. Wherever possible, try to work with suppliers and distributor that promise agility.
3. Perform customer analysis
Forecasting will play an essential role in the overall value derived from your supply chain. In particular, the ability to estimate how well certain products will perform can be used to establish benchmarks that will help avoid overstocking, or conversely, preempt not having enough resources to capitalize on the holiday rush. These types of decisions can no longer be left entirely to intuition. While smaller retailers are in the unique position of having more potential to be agile than enterprises or large corporations – not to mention, they’re also more subject to unique local or regional demands – small business owners need to make sure they make smart decisions based on empirical data.
4. Get a cash advance if necessary
With only a few months left before the real holiday rush gets underway, retailers that are interested in making the most of the season need to start planning sooner rather than later. There is significant opportunity for merchants that leverage supply chain management and analytics tools leading up to the rush to optimize their inventories and boost return on investment. As such, there’s no better time than now to make the changes your small business needs to go into the holidays firing on all cylinders. Start by reaching out to an alternative lender that can supply the small business financing you need to streamline your supply chain management.