In the logistics sector, managing seasonal peaks is the testing ground for warehouses, WMSs and insiders involved in the supply chain. To open the "season" is Black Friday (November 26), closely followed by Cyber Monday (November 29) and in a moment the rush for Christmas gifts has already begun, with an eye on the winter sales.
Customers are known to be increasingly demanding, expecting fast and efficient eCommerce, simple payment systems, immediate in-store availability, timely deliveries and free returns all year round. There are, however, moments in which demand is concentrated and purchases increase exponentially.
In this case, these are predictable peaks, linked to certain recurrences and scheduled times. But this does not make management easier, always characterized by more hours of work, the need for optimization, excellent crisis management skills and trained personnel.
This is why the so-called “high season” is the test bed for any logistics center.
Preparing for the peak season: 5 logistics challenges
How to prepare, then, for the frenzy that, already at the end of October, involves companies, logistics centers and, above all, consumers?
Last-minute offers, discounts, early sales, limited editions invade the physical and online stores, besieged by customers ready not to miss any opportunity.
For a logistic manager, it is like going to war and, just like facing a battle, the first step to winning is knowing one's weaknesses.
The main challenges to face when preparing for the peak season are:
- Increase in orders: the increase in demand could generate interruptions or bottlenecks in the logistics process, as well as making the errors caused by a large amount of work and goods handled easier and more frequent.
- More demanding customers: whether it is a last-minute gift or that product left in the cart for months, waiting for an advantageous offer, the customer in the peak season expects to receive it quickly and at lower costs.
- Increase in reverse logistics: as orders increase, returns proportionally increase, especially after holidays. This translates into more hours of work, higher costs and the need for ad hoc spaces for managing the activity.
- Inventory management: one should be far-sighted in orders and procurement, based not only on the estimates of the last quarter but of the entire year, with a pinch of flair for news and market trends. An up-to-date and well-managed inventory makes all the difference in the peak season because it allows you to respond to demand efficiently and on time.
- Uncertainty about the challenges of the global market: new government policies, economic trends, natural disasters, there are many challenges that can characterize the global market and not all of them are predictable. Logistics managers must always be ready to face a "black swan" when preparing for the peak season, which, despite its predictability, could be anticipated or postponed by external factors.
3 solutions for Black Friday-proof logistics
Managing seasonal peaks is crucial for any business. Planning in advance, using analytics to predict demand, fully or partially automating warehouses, hiring and training additional staff, are just some of the precautions that should be taken in order to manage the most intense work moments (sales, holidays) effectively and efficiently, without interruptions.
The use of a Warehouse Management System, a warehouse management software is the first step to obtain a Black Friday-proof logistics, but it is not enough. You also need a partner with domain expertise and trained personnel, able to make the most of its functionalities at 100%.
It must also be considered that the actions to be taken, to meet the challenges of the peak season, must be studied and tested well in advance, in order to improve and not hinder operations within the logistics center.
Among these we find:
- Adoption of a WMS: a software for managing warehouses is essential for the governance and optimization of operations, keeping inventory under control, managing orders, stocks and all the steps in the logistics chain up to shipment. It is, therefore, an indispensable ally to win the battle of the seasonal peak.
- Optimization of picking: the efficiency and speed of order fulfillment depend on the picking procedures. At the same time, they are those characterized by higher costs, the need for space and the use of personnel and means. With the help of a WMS, picking operations can be fully or partially automated, using new technologies. Voice Picking or Pick to Light, for example, allow operators to work hands-free and significantly reduce errors in this delicate phase.
- Optimization of goods positioning: optimizing the position of items within the warehouse, based on the data on requests, allows you to reduce the picking and preparation times of orders. The ABC analysis, in this case, is particularly useful and functional to the strong flexibility that characterizes the demand in the peak season.
To better manage seasonal peaks, therefore, logistics must be foresight, dynamic and flexible. The goal is to respond promptly to market fluctuations, so as to ensure the perfect functioning of the service and avoid bottlenecks.