As the digital marketplace continues to expand, so too does the potential for ecommerce brands to capitalize on the holiday shopping frenzy.
With online sales skyrocketing to over $250 billion in the United States alone in 2023, and a staggering $12 billion attributed to Black Friday, the significance of meticulous planning for manufacturing and logistics cannot be overstated.
Beyond mere convenience, early preparation is a strategic necessity, serving to mitigate the myriad risks associated with supply chain disruptions, from material shortages to transportation bottlenecks. To seize the opportunity presented by the holiday surge, brands must ensure their holiday inventory is in hand well before late November.
In recent years, the holiday season has proven to be an exponentially prosperous time for all of ecommerce. Online sales in the United States alone in 2023 topped 250 billion dollars, with 12 billion coming from Black Friday alone. Planning manufacturing early for the holiday season, especially Black Friday, is not merely a matter of logistical convenience; it’s a strategic imperative. Being ahead of the curve will mitigate supply chain related risk such as material shortages, production delays, transportation bottlenecks, and unforeseen circumstances.
To effectively capture the holiday surge, brands need to have holiday inventory in hand by late November at the absolute latest. Brands can mitigate risk of delays by acquiring products at an earlier date but can accrue storage fees if utilizing a 3PL or Amazon FBA facility. Brands with in-house warehousing operations can leverage their storage space to their advantage when it comes to preparing a large amount of holiday inventory.
Before any inventory becomes available, even before a production order is placed, brands need to take the crucial step in establishing clear communication channels with suppliers. Ideally, these communication channels should be secured in the early months of the year (Q1). With a healthy supplier relationship, certain arrangements can be made to ensure proper preparation for the holiday season. These arrangements include but are not limited to; acquiring raw materials at an early date, addressing potential production challenges, establishing quality control standards, negotiating favorable production schedules. In certain cases, suppliers will even hold inventory for brands that have established a healthy relationship. This effectively navigates storage fees associated with 3PLs and FBA facilities.
After a healthy supplier relationship is secured, production orders need to be planned accordingly with manufacturing and logistics lead time in mind. The product being made, where it is being shipped to, and how it is being shipped are the three main factors in calculating when to place a purchase order. Every product has a unique lead time when it comes to manufacturing, but it is important to identify other lead times associated with the product outside of the production line such as completing product compliance testing and obtaining product compliance certificates. After manufacturing lead time is confirmed, logistics routes and methods need to be investigated and confirmed as well. Ocean, air, and rail (if working with a nearshore supplier) all have their respective pros and cons, so it is important to investigate each option before coming to a conclusion.
Linton Group has two decades of experience in navigating the Black Friday / holiday rush, as well as other major holidays. Prior to the Covid-19 Pandemic, Linton specialized in optimizing supply chains for brick and mortar brands. Linton transitioned after the pandemic to specialize in supply chain solutions in the world of e-commerce to grow with the exponentially increasing holiday season. For the past 4 years, Linton has been able to effectively plan, navigate, and execute streamlined solutions for the holiday season that has empowered our e-commerce partners to experience growth that tracks alongside the ecommerce boom in recent years. To discuss possibilities, schedule a time here – we’d love to chat!
