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Why is logistics management so crucial during peak selling season?

March 1, 2023 6 Mins Read

As the Islamic holy month of Ramadan approaches, businesses in countries with a Muslim majority will begin to ramp up their operations to prepare for the lucrative peak selling season that comes with it. The success or failure of a business during this sales period leading up to Hari Raya Puasa can be greatly determined by how well its logistics and supply chain management processes are handled.

While this festive season may only last for a couple of weeks, there are also other holidays such as Christmas and Lunar New Year that contribute to increased demand and sales volumes. Let’s not forget the internationally popular sales like Black Friday, Cyber Monday and Single’s Day.

This means, you’d want to have an effective strategy in place that lets you always be ready for the peak period. We mean planning everything, from ensuring you have ample stock to optimising order fulfilment and delivery.

Below, we discuss the pivotal role that logistics plays during peak selling seasons and how to enhance your supply chain for the best shopping and shipping experience.

Why is logistics management so important during this period?

There are a couple of reasons as to why logistics is so important during this period of festivities. The first is the fact that customer demand spikes significantly during this period. Think about the gift-giving season during Christmas: people spend hours online looking for attractive sales before purchasing gifts for loved ones.

The rise of e-commerce here in Indonesia, with the sector being the big benefactor of the 2020 COVID-19 pandemic, has resulted in businesses managing a much bigger influx of orders than ever before during such peak seasons.. This means that businesses need to be able to accurately process, pack, and deliver orders with greater speed in order to satisfy customer demands.

Another key factor is high volume order resulting in the quick depletion of stock levels. As such, it is crucial that businesses have proper management of their supply chain to prevent any shortage of stock to meet customer demand.

Lastly, but most importantly, the speed of your delivery is key during the peak period. Customers want their orders sent to them promptly, especially when they are part of gift-giving or celebrations during the festivities. Businesses need to implement proper logistics processes to ensure that this is possible, lest they lose their customers due to the inability to fulfil orders in time. This places immense pressure on businesses to ensure that orders are dispatched quickly and efficiently.

How can businesses manage peaks in demand?

The success or failure of a business during peak selling season rests heavily on their ability to manage and anticipate customer demand. Here are some ways you can make sure that your logistics processes are up to the task:

1. Establish an efficient inventory system

The onus is on businesses to ensure that they are able to adapt to their customers’ needs during peak seasons, so that they can retain them. To achieve this, businesses need to have an efficient inventory management system to keep track of stock levels and know what is lacking. Doing so allows you to quickly respond to the depletion of stocks and replenish them, preventing any delays in order fulfilment. This is especially important for e-commerce businesses, as customers expect to be able to purchase products online in a quick and efficient manner during the festive sales period.

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2. Rely on automation

Automation streamlines the process of inventory management, allowing businesses to easily keep track of their stock levels and respond to customer demands quickly. With less time spent on manual processes, businesses can allocate more time towards the development of their products and the marketing of their business.

The accuracy of orders will also improve as a result, because the likelihood of human error is reduced. This is crucial, as mistakes made during peak season can prove to be costly. For instance, a wrong address or missing items in an order will mean businesses have to ship out new orders for free or process refunds.

Automated systems can also offer valuable insights into customer behaviour. This helps businesses better understand their customers’ needs and preferences, which can be used to anticipate future customer demand and stock up accordingly.

Last but not the least, the automation of logistics can help businesses improve their delivery times and order fulfilment rates, as well as provide accurate estimates of order delivery durations. Essentially, automation is key to making sure logistics activities run with nary a hitch during peak selling season.

3. Monitor your logistics

Monitoring logistics is important, especially during the peak season. Because of an increase in customer demand, issues such as delivery delays, wrong orders sent out, or shortages of stock tend to arise more frequently. Businesses need to monitor their logistics activities regularly so that they can quickly identify any potential problems and address them before they become a major issue. Monitoring also helps businesses spot bottlenecks in their processes, which allows them to make the necessary changes in order to keep things running smoothly. Through careful planning and management of your logistics and supply chains, you can be sure to weather the storm that is peak selling season and come out ahead.

Here are some important e-commerce metrics to take note of during the festive sales peak period:

Order Volume: Track products that sell off fast, so you can stock up proactively and cater to your e-commerce orders. You should also look back at past peak season sales data to prepare for the new phase, so you will know you have enough products to meet customer demand. In addition, keeping tabs on your order volume can help you identify any spikes in sales, an indication that your logistics operation will soon face increased pressure, hence the need for additional manpower.
Returns and cancellations: This is a very important e-commerce metric, especially for smaller businesses. While returns and cancellations are part and parcel of doing business, you should still be tracking them and making sure that they don’t become too high. If your returns or cancellation rate rises above what is typical for the season, it could indicate that there are problems in the supply chain, packaging processes, or the product’s quality. To facilitate ease of returns, provide your customers with easy-to-use return labels.
Shipping delays: Keep an eye out for potential delays in shipping, as this can have a huge impact on customer experience. If customers are not informed of any delays or if their orders take too long to arrive, they might request for cancellations and move on to another store. This is especially true during peak seasons when customers expect quick delivery times.
Customer feedback: Positive customer feedback is vital for any business. It’s important that you monitor your customers’ comments and via the various feedback channels you have put in place to gain an understanding of their satisfaction with your products and services. This can help you identify areas of improvement and address them quickly if needed. This builds customer satisfaction and trust.

Through the monitoring of these key metrics, you can ensure that your logistics operations are running smoothly and efficiently during peak selling season, allowing you to make the most of this period.

Manage your time in peak selling season

If your e-commerce business is gearing up for Ramadan, Christmas or Chinese New Year period sales or the anticipated Black Friday and the like, you would want to make sure the management of your supply chain and logistics is as efficient as possible. DHL Express can help you with this. With our suite of shipping and logistics solutions that are tailored to meet your requirements, you can rest assured, knowing that your international shipping needs are well taken care of. And with our convenient online tracking tools, you can always stay up to date on the whereabouts of your shipments. If you are looking for a hassle-free peak selling season, be sure to apply for a DHL Express account today.