Now is the Deadline to Get Your Peak Preparations in Order

By Jamie Saucedo

It’s no surprise that starting preparations for the upcoming peak season immediately after the last is the surest way for retailers to see peak season success. However, this is often easier said than done. Ongoing economic turmoil and supply chain pressures continue to force brands big and small to focus on the here and now, often leaving little room for forward planning. Yet with under four months to go before the holiday season begins (including Thanksgiving, Black Friday, and Cyber Monday), brands must act now to streamline their operations before the peak season hits.

Despite falling short of the National Retail Federation’s (NRF) forecast, during 2022’s November-December holiday season, U.S. retail sales grew by 5.3 percent from 2021 to $936.3 billion, indicating resilience even amid historic levels of inflation and economic turbulence. This upward trajectory has also been present in the latest figures from May this year, which saw U.S. retail sales at stores, online, and in restaurants up 0.3 percent from April. Even though there remains a lot of uncertainty surrounding exactly what peak season 2023 has in store, with the right planning, the holiday season will undoubtedly provide brands with the opportunity to win new customers, strengthen bonds with existing ones, and ultimately boost sales.

To achieve this, retailers will be reliant on taking a strategic and well-thought-out approach to peak, of which analysis of the previous peak performance is the very first step. Evaluating success along with any pinch points that emerged last year is a great starting point for brands. Armed with this information, retailers can identify where adjustments need to be made to improve existing operations, as well as where further investment is required to ensure they're set up for success.

Make Sure Forecasting Stays T.R.U.E.

After reviewing the successes and failings of the previous year, a natural next step is to look forward. This is where forecasting comes in. Brands should build a forecast model around their goals and objectives, while also taking into consideration any potential risks that might hamper results. Progress should also be monitored in the lead-up to peak so that adjustments can be made to the forecast if needed. For example, there may be changes to consumer or competitor behavior that need to be factored in (e.g., new trends or product launches and promotions).

To ensure your forecast is set up for peak success, there are four criteria it should meet:

Timely: There must be enough time to implement change if necessary.
Resolute: The forecast must be consistent and produce the same results every single time.
Uncomplicated: The forecast should cover all your bases while still being easily interpreted by all users.
Exact: The forecast should be based on thorough research, including historic and current data, to aid predictions. Your forecast must be watertight.

Take a Decentralized Approach to Fulfilment

Once an accurate and effective forecast has been achieved, and you understand the kind of volume you'll be dealing with, it’s now time to consider how you’re going to keep up. Choosing the right order fulfilment method is crucial. It can have a huge impact on your ability to provide the flexibility, reliability, sustainability and convenience craved by customers. A decentralized fulfilment model, often known as a multinode approach, should be at the top of your list. Commonly referred to as an "alternative" fulfilment method, a multinode approach allows brands to distribute goods across several smaller distribution centers (DCs) rather than storing and distributing from a single DC. With the right distributed order management (DOM) technology in place, inventory can be easily tracked across these locations, allowing brands to efficiently direct orders between multiple fulfilment points — and in doing so, optimize inventory across channels and reduce the distance of last-mile delivery — shortening delivery times and aiding sustainability.

That’s especially important given that consumers are becoming more conscious of the environmental impact of their shopping behaviors, with 64 percent of retailers seeing an increase in customers selecting eco-friendly delivery options. The packaging of goods should also be considered carefully as 61 percent of consumers expect sustainable packaging to be used, despite 30 percent believing the higher cost of more sustainable/eco-friendly shipping and delivery options to be unjustified. While a tough balancing act for brands, awareness of consumer demands around cost and consciousness will be essential to success this peak season.

Understand and Plan for Risk

Unfortunately, no matter how prepared a brand is to tackle peak season orders, there will always be risks that fall outside of its control. Even brands that have a watertight forecast and a well-thought-out fulfilment model in place can quickly become derailed by the unknown. So, how can brands overcome this? By getting to know the unknowns …

To overcome even the most difficult situations, brands must consider the worst-case scenarios. From carrier issues to unforeseen staffing problems or adverse weather conditions, by identifying the potential risks, brands can plan for how they would overcome these, ensuring sufficient contingencies are made should there be the need. Customer service combined with a robust inventory management system should play a big factor in preparing for these eventualities. After all, customers like to be kept informed, and if there should be an event where their order is likely to be late then a brand that's set up to proactively update the customer while tracking and locating alternative stock will be best placed to provide a positive experience.

Don’t Forget the Peak After Peak …

Peak preparations should also factor in considerations around post-peak returns — also known as “the peak after peak.” After all, a rise in sales during the holiday season will inevitably mean a rise in returns. Therefore, just as much emphasis should be placed on planning for reverse logistics as there is on delivering the order in the first place. When handled correctly, returns management and the process of reverse logistics can encourage consumer confidence and brand loyalty. The experience of a return must be just as positive as the purchase experience.

It’s Never Too Early to Prepare

For peak season 2023, the time to act is now, but ultimately preparation can never start too early. By putting in place the right strategies, underpinned by the right systems and technologies, brands can ensure efficient operations geared towards success and optimum customer satisfaction.

For further insights into peak season preparation, including a checklist to ensure success, take a look at PFS’ latest e-book, Is It Ever Too Early to Prepare for Peak?: A strategic approach to executing a successful peak season, time and time again.

Jamie Saucedo is the senior vice president of business operations at PFS, an e-commerce fulfillment provider that facilitates each operational step of an e-commerce order in support of DTC and B2B brands and retailers.

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As Vice President of Business Operations, Jamie Saucedo is responsible for PFS' global portfolio of 70 brands. Throughout her 10+ years at PFS she has served in various roles across the organization, giving her a wealth of industry knowledge across verticals. Jamie applies her expertise to guide our clients to successful eCommerce operations.