Last winter, retail had its best holiday season in 8 years with apparel sales up 8 percent from Nov. 1 through Dec. 24. This year, expect a similar sales spike as shoppers splurge on clothes and footwear during the festive season. With the holiday season just months away, now is a good a time to optimize your supply chain processes so you can capitalize on the most lucrative time of the year. Here is how to do it properly.
- Forecast Demand
Sure, you could splash the cash on some extra stock to meet consumer demand this holiday season, but how much should you spend? This is where demand forecasting comes in. It is a type of predictive analytics where you forecast future demand for your products so you can maximize supply chain operations.
In this context, you are going to forecast demand for your apparel and footwear products for the holiday season — usually Nov. 1 through Dec. 24, though you can change these dates accordingly.
Demand forecasting involves specifying an objective, determining a time perspective, choosing a method for demand forecasting, and collecting and analyzing data. This whole process can be complex, so using the latest demand forecasting software can streamline the entire thing.
- Manage Inventories
Inventory management is a crucial component of holiday sales in the apparel and footwear sector. It allows you to take a more systematic approach when it comes to storing and profiling your products, so you can deliver the right items to the right customers at the right time.
Inventory management allows you to optimize retail sales online and offline (if you own a brick-and-mortar store). You can manage your inventory using Excel or Google Docs, like many businesses in your industry; however, using inventory optimization software provides you with results that are more accurate. These programs use your inventories so you can improve fulfillment rates, reduce costs, and enhance customer service during the busiest retail period of the year.
- Improve Supply Chain Processes
Many retailers are not leveraging digital feedback loops. They still rely on manual stock check methods and contact suppliers when products have run out. This puts an undue burden on big brands since typical lead times for clothing and shoes can be as long as the season itself, eliminating rapid replenishment options and resulting in stockouts and lost business. Vertically integrating supply chain management processes and unifying planning in a cloud-based environment allows brands to extend feelers into their retail stores, detecting buying patterns early, and ordering mid-season replenishments or rebalancing inventories a timely fashion.
In an interview with SCMR, Shawn Curran, EVP of Global Supply Chain Product and Store Operations for Gap, Inc., said “Today, your plan becomes outdated as soon as it’s created. So the next generation of S&OP will enable true dynamic planning and execution. The ability at every meaningful point in your operating model to be able to re-plan and pivot to the geography and channel where there is the highest demand, driving toward where the customer is leading you.”
Well, the next generation is here. A unified supply chain planning platform helps you distribute your products to consumers based on real-time demand forecasts. You can automate the entire process, so you can concentrate on other areas of your business without having to worry about stock levels and changes in consumer demand.
Supply planning programs allow you to build advanced workflows where you can track apparel and footwear products as they move along your chains. In addition, you can set up notifications when products are flying off the shelves faster than predicted. This way, you are always one step ahead of your competition and can improve order fulfillment with a click of a button.
There is still enough time to prepare for the surge in consumer demand this upcoming holiday season. By optimizing your inventories, forecasting demand, and improving your supply chain processes, you can enhance your performance considerably and make this your most successful retail season.