Seasoned business owners and warehouse managers know that although it’s still summer, now is the time to start preparing for the holiday season. The holidays can be an exciting and lucrative period for e-commerce businesses, but they can also be quite challenging. It’s important to gear up and implement good practices now so that your business is equipped to handle the extra traffic, orders, and other unique challenges that come with that time of year.
When to Prepare for the E-commerce Holidays
Traditionally, for most e-commerce businesses, the busiest months are November and December. These months are when the average American does the most shopping. However, to be prepared for the spike in online shopping and e-commerce transactions, businesses and warehouses need to be prepared well before then.
As the beginning of fall is rapidly approaching, now is the time to start thinking about how you’re going to stay on top of your fulfillment processes.
Below we’ve listed 7 important tips on how to prepare for an influx in e-commerce sales for the holidays.
Expect Higher Shipping Rates
As early as October 2nd, the USPS will increase their shipping rates to anywhere between 25 cents and $6.50, depending on the shipping method. This price increase is temporary and will return to normal shipping prices on January 23, 2023, if approved. It’s not unusual for other services, such as FedEx, to tack on a surcharge during the peak holiday season.
You may also see shipping price increases sometime after the first of the year to keep up with inflation and gas prices. At the beginning of 2022, FedEx increased package and freight standard list rates by an average of 5.9%.
To help save where you can, Shipedge offers Best Rate Shipping as one of our WMS features. The ability to shop ship rates allows you to compare prices of different carriers to get the best deal and fastest delivery available.
Additionally, having software that offers cartonization as one of its services will help you save money on both packaging and shipping. Cartonization is the process of determining the most efficient packaging for your product(s), meaning you won’t put items in too large of a box, or waste time putting large items in a box that is too small.
Customers will expect to receive the items they ordered before their holiday. Ensure your audience is well aware of the last day to place orders to guarantee shipment before their celebrated holiday. Consider using a countdown, banner, or pop-up notification on your website stating the last possible date/time you must place an order for items to arrive before Christmas Day.
Take into account that there may also be external variables at play, which may impact expected shipping times. Couriers may be taking longer routes than usual, or there could be road closures due to snow. Communicate with your customers and keep them up to date on the status of their package(s).
Our infrastructure is only able to handle so much at once, so as demand rises around the week of Christmas, limited resources and operations may cause delays in shipment.
Here are some courier resources to help determine the last day you are able to ship for on-time delivery:
- USPS Holiday Schedule
- FedEx Holiday Schedule
- UPS Holiday Schedule
2. Ensure Inventory is Stocked
It may still be August, but now is the time to ensure that a larger amount of inventory for your high-demand products will be available to ship.
One way to help accurately approximate how much stock you should plan to have on hand without overstocking, consider using an e-commerce inventory and demand planning software. Demand planning allows you to use data from multiple areas of your business to make educated inventory decisions.
3PLs should encourage clients to expect to house a higher volume of inventory and to get it replenished sooner rather than later. Ask them to think about filling replenishments now instead of waiting until sometime in October. You don’t want to be sitting on stock for a long time, but you need the stock ready to go for the surge of orders in Q4!
If you’re using a 3PL or are operating your own warehouse, make sure you have enough space for your estimated winter demand.
Rearranging your warehouse temporarily just before orders are expected to pick up is a great way to improve picking efficiency (bringing in-demand products to the front of the warehouse), and can help identify inefficiencies.
For maximum efficiency, Shipedge recommends organizing your warehouse using this coding system:
3. Promotions, Deals, and Coupons
A good way to decrease cart abandonment rates and increase the likelihood of a customer placing an order is to offer a promotion, coupon, or limited-time deal for the holiday. Christmas shoppers love to find a good deal and are likely going to find that competitors offer discounts.
If you can think of any items that would usually be purchased together, create a bundle/kit to sell at a discounted price. Bundling or “kitting” your products is a great way to save on shipping costs, get rid of older inventory, and even increase the total number of products an individual customer may order.
A solid WMS/OMS system will be able to easily create kits/bundles for you. The WMS will recognize individual SKUs in the kit, which is also labeled as its own SKU. For example, if you’re selling shampoo, conditioner, and bars of soap, you may notice that customers frequently buy shampoo and conditioner together. You can create a shampoo/conditioner kit, where those two items can be sold together as a unique SKU. Whatever deals you offer, aim for the best discount with the highest ROI possible.
Be sure to promote any deals you’re having before the actual day. If you’re participating in Black Friday sales, make sure your audience knows about it before you offer the discount. More on Black Friday is below.
4. Return Policy
Before the holiday season begins, ensure you have a solid plan on how you will be handling returns. Whether the return is because a customer was unhappy with the purchase, the product was damaged, etc, it’s good to have a reverse logistics plan in place.
Online sales can expect to see a higher return rate (20-45%) than brick-and-mortar storefronts (5-10%), especially in the clothing and apparel industry.
An easy way to prevent returns in the first place is a solid Quality Control process. Before your items leave the warehouse, check and double-check that they’re something that you yourself would be comfortable receiving.
E-commerce business owners should also ensure that the product listing is accurate, descriptive, and high-quality. When customers buy products, they should be receiving exactly what they see on your storefront.
Decide what you’re going to do once you get returned items to your warehouse from end consumers. Will you use the parts for something new? Fix the product and resell it? Whatever the case may be, keep track of that incoming inventory and have a plan for where it goes once it arrives.
Shipedge offers a strong returns management toolset, which helps protect your investment against fraud and allows you to turn negative customer experiences into positive ones.
5. Prepare for High Traffic
Plan to have more visitors than usual browsing your website. Test your website speeds, and ensure you have the capacity for more traffic than usual, especially on Black Friday and Cyber Monday.
Your customers want a cohesive, quick, and easy shopping experience. The more user-friendly and speedy your website is, the more likely you are to increase your shopper-to-customer conversion rates. Here are some common and relatively simple ways to improve the customer’s experience with your brand.
- Customer Service: Be available for shoppers that have questions. Create or update your FAQ page, use a chatbot, or have contact information so customers can reach out directly.
- Test Your Website: Your website is going to have more traffic than usual, so make sure it can handle a larger amount of users. Additionally, make sure your website doesn’t take too long to load. Longer loading times will mean a higher probability of a shopper going someplace else to do their holiday shopping.
- Ensure Consistency: Do your listings contain conflicting information? Does your FAQ page have an incorrect or outdated answer? Watch out for typos, and if anything changes- update it!
- Streamline the Checkout Process: Make it simple to check out. The more customers have to click around on your website, the more likely they are to give up.
6. Black Friday and Cyber Monday
In 2022, Black Friday is on November 25th, and Cyber Monday is on November 28th.
As the two busiest days of the year for most e-commerce businesses, you should take advantage of the market.
Most consumers do their Christmas shopping on Black Friday and Cyber Monday, marking them as the two busiest days of the year for e-commerce businesses. However, in recent years, you may have noticed that Black Friday and Cyber Monday aren’t being treated the same by consumers and sellers the way they used to.
With the rise in purchases occurring over the internet, Black Friday sales can be seen starting weeks before the actual date! On Cyber Monday, a relatively newer “e-commerce holiday”, deals have been known to go on for the entire week, rather than just that Monday.
In 2021, Black Friday sales actually decreased for the first time in history. This may be in part attributed to sales lasting longer (starting the Monday of Thanksgiving and ending a week after Black Friday), giving consumers the opportunity to purchase on their own terms. Your competitors are going to be taking advantage of this newer, larger window of opportunity to have sales, and you should too!
As mentioned above, remember to market your sales ahead of the event so your audience is prepared to buy.
7. Seasonal Employees
If you are operating a larger warehouse, you will likely need more laborers than usual, especially during the busier winter months.
Before you take on seasonal employees, identify a leader in your warehouse that knows your picking/packing system thoroughly to take charge of the busy season. To help identify your top workers, pull a report from your WMS to see who stands out from the rest.
As you begin ramping up on seasonal employees, evaluate the benefits of starting earlier in the morning and working later in the evening.
After orders have died down and the holidays have passed, it’s more than likely in January you’ll have an influx of returns. Keep some dedicated seasonal employees on board while you manage the returns you receive after the holidays.