For most e-commerce businesses, peak seasons are when they generate most of their income. During these times, you can grow your business, bolster sluggish sales, and impress your customers. Holiday sales alone can represent up to 34% of a company’s annual revenue, depending on the retail sector. However, to take advantage of these opportunities, you should be prepared to meet the logistical demands of packaging and delivering orders in time to dazzle your customers and maximize your profits.
This guide will walk you through actionable strategies for managing your peak seasons effectively to make the most of them and gain a larger market share when they’re over.
Although Black Friday has historically marked the beginning of the peak season for many retailers, it varies from business to business. Peak seasons are any time you experience high demand and increased sales. In addition to the end-of-the-year gift-giving frenzy, peak seasons can include when people shop for summer vacations, back-to-school supplies, or other special promotions in your industry.
The traditional end-of-year peak season has also expanded in response to customer demand and is starting as early as the end of October with rolling promotions that carry on through the end of the year. You might also notice increased sales during shopping holidays, such as:
Although you probably have a general idea of your peak seasons, data analytics can help you develop strategies to fine-tune and optimize.
The best place to start analyzing peak seasons is with your historical sales data. Look granularly into your order and shipment volume from previous years to pinpoint specific times when your sales increase.
However, you’ll also want to analyze market trends for a broader insight into peak seasons. You may be able to uncover industry trends that indicate sales opportunities are passing you by because you’re not leaning into potential peak seasons. For example, say your market typically experiences a sales bump during the weeks leading up to Halloween. Unfortunately, your sales have been flat during this time, so you may want to implement a marketing campaign to drive Halloween sales. Companies like YouGov can give you insight into industry sales trends so you can make data-driven decisions about peak season marketing.
You’ll also want to examine consumer behavior statistics to tap into market opportunities and better position your business. For instance, social shopping is on the rise, with 59% of businesses reporting an increase in 2023. You can use information like this to allocate your marketing budget to channels that generate the highest return on investment (ROI).
If you don't have a strong fulfillment strategy, the extra sales during peak seasons could create a logistical nightmare that will backfire on you. If your most in-demand items are out of stock or orders aren’t sent out in time, your customers will quickly sour on your brand and look elsewhere.
Over 68% of customers report that fast shipping is a top priority in online shopping. To meet these demands, you need to keep products in stock and ready to ship immediately. However, you don’t want to be left with a surplus of excess inventory that you’ll have to sell at a loss or not be able to sell at all.
Peak seasons are common across many industries and can strain fulfillment centers, inventory systems, and logistical networks. Supply chain disruptions are also a significant issue given the complexities of navigating global network hubs and the havoc weather events can wreak on major ports.
You’ll need a multi-faceted strategy to make sure you can deliver your customers’ orders quickly and accurately and manage their concerns and returns without negatively impacting your sales and reputation. The major areas you need to consider to make sure your company is prepared for peak seasons include:
Effectively managing fulfillment planning during peak seasons drives increased sales and improves customer satisfaction and loyalty during times of high demand. You’ll also position your business to take advantage of future peak seasons, creating a virtuous cycle for years.
Revenue in the global e-commerce market is expected to exceed $4.1 billion by the end of 2024, and fulfillment planning is one of the most critical operations for success. You can’t guarantee fast and accurate customer delivery without an efficient fulfillment plan. Here are some key strategies to make the process go smother:
How you manage your inventory will have a huge impact on profitability. With errors found in 51% - 65% of inventory records, most businesses have a lot of room for improvement. Inventory management relies on a complicated mix of many actors, so, understandably, many companies struggle. There are several methods you can use to optimize your inventory levels, including:
You’ll likely need additional staff to handle increased orders and inventory fulfillment during peak seasons. While it can be tempting to hold off on hiring staff until you need them, they should be trained and ready to go when the peak season hits. If you take the time to do it thoroughly, you’ll have lower turnover rates, more engaged employees, and happier customers.
Tailor your training based on roles and responsibilities for the best results at the lowest cost. You can cover the basics of your company culture and procedures with all new hires, but whittle other training down to what specific employees need to know. Eliminating extra training will bring staff up to speed as quickly as possible but make sure they understand how to perform effectively.
Automation and artificial intelligence (AI) are streamlining operations across industries, and fulfillment planning is no exception. With the widespread use of connected devices, inventory management technology can give you visibility into your inventory and fulfillment from when orders are placed until they’re delivered to your customers.
Automation in warehouses can drastically reduce the number of workers needed to pick up and fill orders. These systems are expensive on the front end to set up but can be a good option for enterprise-level operations or order fulfillment centers.
Another area where technology is improving and simplifying tasks in inventory management is through predictive analytics. These programs can analyze your previous sales, industry trends and benchmarks, and customer behavior for more accurate demand forecasting. A study by global consulting firm McKinsey & Co. found that using AI in procurement increased inventory and service levels by 35% to 65% and reduced logistical costs by 15%.
After the shock of inventory and labor shortages during the pandemic and afterward due to political and weather disturbances, businesses became more aware of the importance of building a resilient supply chain. However, many organizations still lack an effective method for evaluating and quantifying supply chain risks. Less than half of senior supply chain executives fully understand the location and risks of their top suppliers.
Diversifying your supply chain and collaboration partners can seem like extra money and time. However, securing inventory and meeting demand are crucial in an uncertain global business environment. Finding alternative shipping options and implementing contingency plans can help provide smooth shipping even during high-demand periods when you’ll be competing with others in an overcrowded market.
The most common challenges in peak season fulfillment planning are related to optimizing inventory and supply chain management. These challenges include the following:
Work with multiple suppliers to prevent supply chain disruptions. If one supplier is cut off, you still have established relationships you can draw on to fulfill orders.
Tech solutions also help with logistics planning. Inventory management systems can help you keep track of incoming inventory and outgoing customer orders, while analytics software can provide accurate demand forecasting.
If you don’t have a strong supply chain network, working with third-party logistic partners for e-commerce fulfillment can give you access to the resources of larger companies. These 3PL fulfillment providers have established relationships and redundant shipping partners in case they need to pivot at the last minute.
Using predictive analytics can help you anticipate and stock up for customer demand, but — short of ordering excessive inventory that you could be stuck with long after peak season — you’ll always be at risk for stockouts.
Offering pre-orders can help head this off. If you allow customers to place orders before you order inventory, you’re sure to have what they want in stock. This strategy will work best for hyped products that have a built-in demand with a long lead time. It won't be effective if you're trying to appeal to last-minute or indecisive customers.
You can also put customers on a waitlist if you do run out of high-demand products. Though they may not get what they want during peak season, you can head off disappointment with timely and transparent communication. Providing excellent customer service to manage expectations and build trust can turn disgruntled customers into loyal brand ambassadors.
As with inventory issues, redundancy is the best way to address shipping and delivery issues. Build strong partnerships with logistics companies and e-commerce fulfillment companies that can scale with your business. Offering your customers automated tracking information will give them visibility into the process and increase satisfaction. During hectic times, you can explore options such as local couriers or click-and-collect services so your customers can pick up items they order directly.
There’s no perfect method for order fulfillment. You’ll need to look into every avenue available to you to build redundancy and resilience into your processes. Fortunately, associated industries, particularly AI-driven tech applications, provide new solutions rapidly. Software that provides visibility into your supply chain can improve your shipping and delivery processes.
Peak season shopping drives a large part of your annual revenue. Optimizing peak season fulfillment planning can maximize your profits and minimize costs. To do this, you’ll need to focus on inventory management, training and engaging your staff, dealing with logistics, and streamlining workflows through technology applications.
Although much goes into order fulfillment, preparing in advance can lead to a smoother and more profitable peak season, increased customer satisfaction, and long-term loyalty.
Start preparing your e-commerce peak season strategies early for the best results. QuickBox Fulfillment is a 3PL logistics and fulfillment provider specializing in e-commerce and multichannel fulfillment services. We provide a range of solutions to help you with peak season fulfillment, from custom boxing for brand experience fulfillment to an efficient returns process. If you want to be on top of your peak season this year, reach out today to find out how we can help you prepare.