Don’t Procrastinate This Holiday Season
Procrastinators beware… 2021 is not your year. Heed our warning when we say — start your holiday shopping early. We aren’t being alarmists here. If you thought 2020 was filled with retail chaos due to store closures, in many ways the retail sector is struggling even more due to a combination labor shortages, driver and trucking shortages, semi-conductor shortages, container shortages, and long delays at ports. And did we mention that many retailers are scrambling since factories in Vietnam are shut down or operating at very limited capacity due to COVID outbreaks. If you love the thrill of last-minute shopping, you might just find empty shelves or products that can’t be delivered till spring. Never has the old adage “the early bird gets the worm” been so true.
Nearly twenty months into the pandemic, we are faced with the reality that a second holiday season will be disrupted. Let’s start with inventory issues. The holidays are a make-or-break for retailers large and small, but this year it will be fraught with product delays, low inventory and higher prices. Many retailers who rely on merchandise produced in Vietnam are re-evaluating what they can get to showrooms in time for fall and winter. Companies like Everlane are facing delays of 4-8 weeks, Nike cut sales forecasts citing a loss of production due to factory closures, and Urban Outfitters’ top concern now is simply getting products into the United States, rather than replenishing inventorythroughout the season. Many retailers are already advising customers on their websites about inventory issues and shipping delays.
If you thought grabbing that sweater or those Nike running shoes would be hard enough, when that special someone in your life wants a device that uses a chip, they might be waiting for a while for their gift. The semiconductor shortagecontinues to put a tight squeeze — and one might say tight grip — on the supply of electronics, from computers and gaming consoles all the way to cars. Unfortunately, production of semiconductors will not match demand through 2022, leaving many products in short supply.
It’s not just production issues caused by factory shutdowns and the inability to quickly scale up to meet consumer demands; this year’s holiday season may also be thwarted by the congestion in the U.S.’s freight system. Scores of container ships await unloading at the ports of Los Angeles and Long Beach, carrying all those coveted toys, electronics, and other goods. And even when containers are unloaded, the lack of labor at trucking companies and warehouses means that consumers are waiting longer to get their goods.
What does all this mean for consumers? An uneven and short supply of products means that consumers will need to start shopping for coveted gifts early. Experts predict that retailers will offer fewer big sales even on Black Friday due to high demand and low inventory. Shopping this year will require consumers to start early, monitor multiple retailers to see who has inventory and at what price, and then quickly hit ‘purchase’ instead of waiting for the price to drop.
Retailers can help their consumers weather the retail apocalypse this holiday season by leveraging the right supply chain technologies. With full visibility of inventory across the network, retailers can provide consumers with accurate inventory data right from the search page, along with urgency messaging to compel consumers to take action and prevent disappointing them. Using the right transportation management solution, retailers can execute dynamic transportation strategies, optimize operations based on real-time information, gain in-transit visibility and control in the face of increasing disruptions, and leverage prescriptive exception management to improve service levels and reduce risk and costs. With AI-powered order promising and fulfillment, consumers don’t have to guess when their orders will be delivered. Modern control towers leveraging AI and ML give retailers real-time visibility across their supply chain to understand and anticipate bottlenecks and future disruptions and make real-time decisions to keep the flow of goods coming.
Blue Yonder offers a full end-to-end suite of supply chain solutions that can help your business weather the supply chain apocalypse of 2021, including our Luminate Control Tower, Luminate Logistics, and Luminate Commerce solutions.