An accurate retail planning strategy can increase profits and reduce costs and waste. See our tips to make the most of your demand planning for peak season.

The retail market is dynamic and always changing, so while no plan can perfectly predict needs for the season, an effective demand planning strategy can benefit retailers in many ways. Efficient demand planning can lower warehouse storage costs, improve logistics, create more efficient production, reduce waste and provide a better experience for your customers. It’s predicted that demand planning can increase gross profits from 3-5%, according to RackBeat.

Demand Planning for a Successful Retail Peak Season

1.    Sync Up with Your Suppliers

2.    Think Broadly and Analyze the Market

3.    Get Feedback from Multiple Departments

4.    Set Your Priorities

5.    Establish Measurable KPIs

1.   Sync Up with Your Suppliers

Collaboration between retailers and suppliers is essential to demand planning for a successful peak season. The earlier you can begin working together, and the closer, the better. Assess how your suppliers have been managing and ask about any concerns they may have about the upcoming season.

Retailers should communicate their holiday plans and share as much data as they can. Share forecasts, and review things like promotional uplifts and daily profiles. Inventory transparency is another important factor for making informed decisions when it comes to retail demand planning, so it’s important to work with partners who have access to real-time inventory and can make accurate predictions.

While planning for peak retail products, don’t forget your operational supplies to help you run smoothly, including everything from your seasonal bags, gift wrap to cleaning products and office supplies for a larger retail team.

Ensure your suppliers have a full view of your peak season plans to avoid as many curveballs and last-minute requests as possible. Of course, there will always be surprises or bumps in the road, but if they can be minimized it creates a more seamless operation for you, your suppliers, and ultimately, your customers.

2.   Think Broadly and Analyze the Market

During the demand planning process, there is often so much focus on internal numbers and reports that retailers can forget to look beyond their own data and out into the world as well. While comparing historical data is important, assessing the market and industry is also crucial. Ask questions such as:

What are the latest consumer trends? Are there any brands expected to take off?

What is happening in the world right now? Is there any big news with your competitors? Could certain local stores see an influx or drop due to world events?

Although we may have no control over these external factors, it’s important to consider how they could affect your peak season and be as prepared as possible.

3.    Get Feedback from Multiple Departments

While one department may lead the demand planning process, it’s important to gain feedback from across the organization to hear a range of opinions and experiences.

These various departments should get aligned on what their goals and priorities are, what challenges they face, what their past seasons have looked like and what their department anticipates in the future.

Supply chain, finance, marketing, sales should all work together and communicate openly to create a comprehensive plan. Some factors that may be examined are sales metrics, marketing campaigns, inventory turnover, out-of-stock frequency and production lead times.

4.   Set Your Priorities

The pressure of the peak holiday season can make it feel as if everything is urgent, but the key is to know where to place emphasis and direct focus.

Once your team has obtained cross-departmental feedback, create a list of priorities. Analyze where concessions can be made and which areas are the most urgent or important.

Having conversations across departments as previously mentioned can help determine these priorities. Set criteria to determine priorities for the upcoming peak season and then establish a process to fulfill the higher and lower priorities.

5.   Establish Measurable KPIs

Setting key performance indicators (KPIs) will help measure your success year after year and gives your team a quantifiable goal to reach. Assign goals and track progress for areas such as forecast accuracy, tracking signals, order fulfillment lead time and more.

Continuously check your progress against those goals and make adjustments as necessary. The holiday peak for retail is often a moving target, so it’s important to remain flexible and nimble throughout the process.