Before the pumpkins have rotted and Halloween candy fully devoured, it now seems like the Holiday season is upon us. Hard to believe, but Black Friday and its relatively new “digital twin,” Cyber Monday, are almost here, ready to kick off the beginning of the holiday shopping season, with retailers offering substantial deals both in-store and online.
But in recent years, it seems to have expanded into a month-long event. Retailers kick off promotions as early as October, leading many to wonder if we should now refer to it as “Black November.”
This shift reflects the increasing competition among retailers eager to capture consumer spending before the Thanksgiving turkey is even served.
Key Statistics, Trends and Consumer Behavior in ‘24
According to a recent survey by Shopper.com, consumer spending is expected to rise this year:
- 24% of respondents plan to spend more than last year.
- 68.8% will shop on both Black Friday and Cyber Monday.
- 52.6% intend to start their shopping even earlier with pre-Black Friday deals.
There is also a shift towards digital and hybrid shopping experiences, with 58.4% of shoppers mixing online and in-store shopping, while 34.6% are fully committed to online-only.
What are the Supply Chain challenges of the “Holiday creep”?
Supply Chain Strain
As Thanksgiving approaches, retailers face immense pressure to meet increased consumer demand. With over half of consumers planning to begin their holiday shopping by Thanksgiving, it increases the importance of accurately predicting inventory needs and the importance of forecasting demand during fluctuating consumer preferences and market dynamics.
Transportation Troubles
Logistics also become a significant challenge during this peak season. The recent West Coast Port strike, all be it quickly resolved, has only increased congestion, which can lead to delays in deliveries. Weather conditions can further complicate transportation logistics, emphasizing the need for robust contingency plans.
Inflation and Its Impact
The rising cost of goods has added another layer of complexity this holiday season. Prices for essential Thanksgiving Day meal have surged – potatoes are up 17.5%, butter has risen by 34%, and canned goods have seen similar increases due to heightened shipping costs and raw material shortages. Retailers must navigate these inflationary pressures while maintaining competitive pricing strategies.
Preparing your business for seasonal challenges
As we look ahead, businesses must embrace proactive strategies:
- Inventory Optimization: With the growth in e-commerce and hybrid-sales, every warehouse, retail location, and pop-up site become a distribution center, and positioning the right inventory, at the right locations is critical to get supply close to actual demand this holiday season.
- Contingency and Scenario Planning: Running simulations and what-if scenarios enable companies to develop backup plans for unexpected disruptions, enabling them to be ready for whatever surprises or gifts the holiday season brings them.
- End-to-End Visibility: The ability to see what is happening in real time, across the end-to-end supply chain from raw materials to under the Christmas tree is critical this time of year. Where do I have product surges? Where am I going to running out of stock? Where do I have excess inventory? All these questions, and more need to be answered, to ensure customer satisfaction.
- Predictive Analytics: We are in an era where we have unprecedented amounts of data (both structures and unstructured) about trends, customers, buying patterns and more. Leveraging this data to predict and identify where product demands are surging could be the difference between seasonal profit or loss.
Understanding these dynamics not only helps businesses prepare but also allows consumers to appreciate the intricate logistics that make our holiday celebrations possible.
As we gather around our tables this Thanksgiving, let’s take a moment to reflect on the hard work behind the scenes that brings our festive feasts and gifts. From navigating supply chain challenges to leveraging technology for smooth operations, each aspect plays a vital role in ensuring that we can enjoy this most wonderful time of the year with friends and family.
A heartfelt ‘cheers’ to a successful Black Friday and Cyber Monday for everyone!
