Peak Season Pitfalls: 8 Mistakes Brands Should Avoid
Peak season. It can make or break ecommerce brands and third-party logistics (3PL) providers. Product demand increases, delivery times decrease, and fulfillment accuracy is imperative. If there was ever a better time to start thinking about smart inventory management practices, it’s now.
In this guide, we’ll explore:
- Labor Shortages
- Unaffordable Shipping
- Poor Demand Forecasting
- Poor Warehouse Layout
- Technology Problems
- Lack of Centralized Management
- Choosing the Wrong Fulfillment Logistics Partner
One of the keys to peak season success is labor—having enough staff hired and trained to meet the increase in demand. Inventory can’t move in and out of your warehouse without adequate staffing. Trying to hire more employees once peak season is underway will leave you scrambling. Labor shortages are happening throughout the supply chain industry; getting started on your labor planning early is critical.
Successful labor planning begins with your historical records from past peak seasons, which can give you insights into how many employees you need and the number of shifts you need to run each day to meet demand.
Effective training, both in your inbound and outbound processes and in the specific tasks an employee will be doing, and best practices in inventory management are vital as you prepare for peak season. Remember that training takes time, and plan accordingly. Create a pre-set onboarding plan for all new staff in different positions, and employ the buddy system to ensure new hires learn the ropes quickly and adequately.
The growth of ecommerce has raised the demand for lower shipping costs. Smart shipping features in warehouse management systems (WMS) allow you to shop for the best rates from carriers and can provide shipping box suggestions and automatic weight calculations. WMS tools can also provide address verification to streamline your shipping processes, reduce mis-shipments, remove the guesswork, and save you (and your customers) money on shipping.
Poor Demand Forecasting
As you prepare for peak season, you may think best practice would be to order a lot of product at once to help you meet demand faster. But overstocking your shelves can also cause problems. If you manage perishable goods, they could go bad sitting on your shelves. More generally, over-ordering can take up valuable space in your warehouse, making it challenging to manage inventory effectively.
WMS tools for inventory management in logistics can help you plan for peak season demand by using historical data, creating algorithms for replenishment and re-order levels, and helping you avoid inevitable backlogs due to a consistently overwhelmed supply chain.
Poor Warehouse Layout
Not using your space effectively can have detrimental effects on smart inventory management and every process in your fulfillment process, from receiving and putaway to picking, packing, shipping, and even handling returns.
The type of inventory management system you use should help determine how you layout your warehouse. Robotics or other automation tools (more on those below) will also impact the warehouse layout.
You’ll need to evaluate your pick and pack processes to ensure they can be completed promptly and efficiently based on your current warehouse layout. By uncovering pinch points and bottlenecks, you can rearrange the layout to create seamless processes that help you quickly get your inventory into customers’ hands.
From barcode and RFID scanners to conveyor belts, picking robots and drones, WMS software, and other artificial intelligence tools, technology plays a vital role in ecommerce inventory management. Tablets and mobile devices allow warehouse staff to complete tasks quickly, and cloud-based inventory management software lets managers and clients access information about order details and inventory levels in real-time.
However, relying on technology can come at a cost when it fails. And in peak season, time lost dealing with technological issues can affect your bottom line.
Regular maintenance is essential to ensure automation tools are working correctly, and ongoing training will help employees use available tools to their full capabilities. Don’t forget to install software updates as required to keep everything running smoothly.
No one likes to see “Out of Stock” or “On Backorder” when shopping online. With omni-channel shopping, the risk of customers seeing these messages increases without proper ecommerce inventory management systems in place. Overselling puts you at risk of being unable to fulfill orders, which could be detrimental to your bottom line.
Using WMS software with properly configured algorithms, you can enjoy up-to-the-minute insights into what you have in stock across all of your warehouses to avoid overselling scenarios. You can also see when new product will arrive to help you keep “Out of Stock” messages to a minimum.
Lack of Centralized Management
Inventory management in logistics fails when processes aren’t managed centrally. If employees pick jobs with printed spreadsheets, how will you know if an item is running low or out of stock? Manual data input is at risk from human error, and manual processes can cause numerous issues, including the ones listed above.
Choosing the Wrong Fulfillment Logistics Partner
For brands and ecommerce retailers, choosing who to partner with is a challenging decision. You need to find a logistics partner you can trust who will make running your business easy.
When choosing a fulfillment logistics partner, don’t be afraid to ask the following questions:
- What types of businesses and retailers do you typically serve (B2B, B2C, DTC)?
- What is your warehouse capacity?
- What is the average time it takes to pick, pack, and ship an order?
- What WMS tools do you use?
- Do you have references we can speak to?
Using cloud-based systems for smart inventory management will prepare you for a successful peak season and beyond.
Check out our website to learn more about inventory management for ecommerce and how Logiwa’s WMS software can help your fulfillment operations. While you’re there, download our ABC Inventory Analysis Excel template to determine which products are the most integral to your business.