Noting that supply chain disruptions will continue, an article from Tompkins Inc. offers some advice on advance planning. In order to successfully manage the busiest time of year for retailers, the firm advices companies to manage these issues.
Omnichannel offerings
While the National Retail Federation reported a 9.5% increase in online sales during the November–December 2022 holiday season, in-store shopping still plays an important role in retail, with Forrester predicting offline sales will make up 72% of the retail market by 2028.
The convergence of physical and digital shopping is being fueled by click-and-collect services, including “buy online pick up in store” (BOPIS) and curbside pickup. While click-and-collect options increase customer satisfaction, they also provide many benefits for retailers, including reduced delivery costs and increased incremental sales.
Leftover inventory
Retailers have been grappling with inventory glut since last year, when many were experiencing an excess of up to 30-50% over the previous year. The surplus—much of which was the result of overordering and delays stemming from 2021 supply chain disruptions—is still causing headaches for retailers as we approach the 2023 holiday season, with many forced to either deeply discount the goods or deal with the hefty storage costs and space requirements.
As more shoppers seek out bargains this holiday season, retailers can capitalize on the opportunity to give customers what they want while clearing out excess inventory. With an intelligent inventory management system (IMS), retailers can access valuable insights on customer preferences and manage stock across all channels and locations to ensure they have the right products in the right place to meet customer demands and maximize profits.
Costly returns
On top of contributing to the inventory glut, processing returns is also costly and complicated for logistics operations, with returned goods accounting for $816 billion in lost sales for U.S. retailers last year, according to the NRF. As a result, retailers are experimenting with everything from shortening return periods to charging fees. While these methods may help streamline the returns process for retailers, many consumers still prioritize free and convenient return policies.
According to a recent Salesforce survey, 93% of shoppers review a company’s return policy prior to making a purchase. Implementing a comprehensive reverse logistics strategy will enable retailers to retain customers, minimize costs and streamline the returns process this holiday season.
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