Supply Chain Planning for the Holiday Shopping Season
July 7, 2022
With the holidays coming up, many businesses are trying to keep up with consumer demand while dealing simultaneously with global supply chain issues. Before companies consider making adjustments, they’ll need to revisit supply chain plans. Supply chain planning (SCP) involves the coordination of different processes to ensure that goods or services are streamlined from the supplier to the customer.
A large part of supply planning involves anticipating customer needs. By understanding consumer demand, companies can adjust demand and supply plans accordingly. Location intelligence can give supply chain managers additional insights, which can allow them to adapt business processes.
Here are three ways location analytics can be used to create supply chain strategies to meet holiday shopping demand.
Understand Customer Behavior Trends
Most importantly, businesses need to first consider customer needs. To create an environment for supply chain innovation, it is important to put customers first. Location intelligence gives businesses an understanding of where your customers go in the real world. It can help businesses answer questions such as, “Which stores do customers visit often?” This information gives supply chain managers a better idea of what customers might be looking for. For example, if a store’s customers tend to visit wholesalers frequently (sometimes more than one) during the holiday shopping season, then this could indicate that they are potentially looking for low-cost bulk items to save money go gift spending.
Supply chain data can be enriched with consumer insights from enterprise location intelligence. Supply chain managers should look for trends in the data to understand current consumer behavior trends. Are they doing most of their holiday shopping with specific brands? What does the typical customer journey during the holidays look like? Location analytics can provide supply chain management with insights into what customers are shopping for during the holiday season.
Determine Where Consumer Demand Is
Demand planning involves inventory management and customer fulfillment. It’s an important part of the supply planning process – the more accurate your demand plan, the more accurate your supply plan will be. By analyzing location intelligence, businesses can determine which stores are seeing increases in foot traffic. This can give leadership an idea about where the demand is coming from. Is there a particular region that is seeing more foot traffic than another?
Once a company identifies where the demand is coming from, they can determine how to meet customer demands for the short term (60-90 day horizon), long term (12 to 24 months), and even map out weekly operations processes. By pairing location intelligence with inventory management data (e.g. quantity and cost of goods), supply chain managers can get a better picture of which regional stores are seeing movement in inventory.
Inventory turnover is a KPI which measures how an organization moves their inventory. By enriching inventory management datasets, companies can better understand inventory turnover. In addition, supply chain managers can also use this enriched data to measure another important KPI, inventory accuracy. Inventory accuracy is the measure of what is physically in your store versus what is shown in your inventory database. For example, if a retailer sees that foot traffic is higher at one store compared to others during their holiday sale campaigns, then that particular store needs to have the right amount of inventory to meet the increase in consumer visits.
Enrich Supply Chain Analytics
Location analytics can be used to enrich supply chain reports within SCM planning tools. By enriching consumer data, companies can improve ROI, manage risk, increase planning accuracy, and reduce inventory waste. These tools can also give leadership the ability to analyze the entire supply chain and generate reports such as demand forecasting, logistics analysis, and transportation analysis. Location intelligence provides companies with information to conduct advanced supply chain analytics including mapping out delivery areas and determining which locations are experiencing bottlenecks. Insights from a supply chain analysis answer questions such as:
- Which areas are showing less demand?
- Can the company meet an increase in demand from all locations at once?
- Which areas are experiencing issues with delivery? Which ones aren’t?
- Is there a need to increase delivery trucks to certain locations?
As the global supply chain continues to be impacted by the coronavirus pandemic and rising costs due to inflation, it is important for businesses to be one-step ahead. Not only can supply chain managers use location intelligence to enrich supply chain analyses, but they can also improve the customer experience by understanding what consumers are interested in and where the demand is based on market trends.