E-commerce fulfillment is a tedious task and must be done in the right way to avoid costly confusion and mishap.
During the holiday season, the logistics become even more complex due to the increase in customer traffic. According to EKN Research, 18% of every dollar gained through online sales goes toward fulfillment costs.
Many sellers have no idea what holiday fulfillment is. Even if they do, they are not sure what steps to take to ensure that their products get to the right place at the right time during the holiday season.
If you want your shipping department to perform at its best during this time, this article covers all the insights on how you can optimize your e-commerce fulfillment during the holiday season.
Let’s get started.
Holiday Fulfillment: What it means for sellers?
The holiday season is the most important time of year for online sellers. According to a report from Google and the consulting firm Bain & Company found that in 2020, more than 40 million people in Singapore, Malaysia, Indonesia, the Philippines, Vietnam, and Thailand had become new internet users.
A recent study by eMarketer predicted that these economies would see a 20.6% growth in e-commerce sales by 2022. This would translate into $89.67 billion in total e-commerce sales—the highest rate of growth in the world.
With so much money at stake, it’s important to make sure your e-commerce fulfillment is up to snuff.
But your business needs a strong fulfillment engine to claim that market revenue. That’s why it’s crucial to have optimized and efficient processes in place during the holiday season.
What is holiday fulfillment?
Holiday fulfillment refers to the process of getting your products into the hands of your customers during the Christmas season. This can include:
- Picking, packing and shipping orders
- Managing returns and exchanges
- Adding new items to your inventory
As an e-commerce seller, you need to take special precautions during this period because your business depends on timely deliveries and efficient logistics to stay competitive and profitable. You need to understand how your customers will be receiving their orders during this time. And how to better the overall customer buying experience to get the most out of holiday sales.
What are some costs that brands need to keep an eye on during the holiday season?
The holiday season is one of the most important times of the year for e-commerce brands. With so many potential customers out there and so much competition, it’s essential to make sure your brand stands out from the rest.
However, it’s not just about standing out. It’s also about ensuring you’re getting an investment return.
Here are some costs that brands need to keep an eye on during the holiday season:
Peak season surcharges
During peak periods of the year, like the holiday season, businesses are often hit with additional costs due to increased demand for their goods or services. These surcharges tend to be higher than usual due to higher rates from suppliers, shipping companies, and other related businesses like couriers or delivery services.
Suppose your business is reliant on these services. In that case, you need to find ways to offset these costs by increasing your prices or negotiating better rates with suppliers or other service providers.
Inventory Management Costs
During peak season, it’s important to manage your inventory levels carefully. This means knowing when you need to order more products or temporarily suspending sales if stocks run low. It also means taking into account what kind of inventory management software your business uses and how well it works with peak season demands.
If you don’t end up overspending unnecessarily on extras like storage space or additional employees who aren’t needed at this time of year (unless they have been hired specifically for this period).
Peak season fulfillment fees
Fulfillment companies charge more during peak season because they’re busier than usual. They also have more staff on hand to handle increased demand.
If your fulfillment company charges an additional fee during peak season, try another provider — there are plenty who don’t charge extra for their services during this time of year.
Packaging costs can add up quickly if you aren’t careful about what you buy and how much it weighs. The shipping cost will skyrocket if your order exceeds the maximum weight limit for certain carriers, such as UPS Ground or FedEx Ground. And if those products are fragile, like glassware or wine bottles, be prepared to pay more than usual for shipping because these items require extra care during transit.
If you want your product to arrive in one piece without breaking during shipment, consider using our end-to-end fulfillment service that allows you to ship multiple packages from one place.
Common factors to factor in ahead of Holidays
The holiday season is a time of year when e-commerce businesses can see a significant spike in sales. However, it is also a time when fulfillment costs go up, and the number of orders received increases dramatically.
If you are planning to grow your business during this period or simply manage your fulfillment operations more efficiently, here are some important factors to consider:
Holiday fulfillment center staffing
The holidays are a busy time for everyone — including your customers and your staff. If you aren’t careful, you could end up losing customers because they can’t reach anyone at your company, or they don’t feel like they’re being taken care of properly.
This is why it’s important to ensure that you have enough employees on hand during this period so that everyone feels like their needs are being met quickly and accurately.
Learn the Holiday Shipping Deadlines
The most important thing you can do is learn when your customers need their orders by so you can get them out on time. The closer it gets to Christmas and New Year’s Eve, the more likely people will be ordering last-minute gifts or stocking stuffers they forgot about until now.
So if you’re having trouble meeting this deadline, consider offering expedited shipping options or using third-party services. These services manage fulfillment for their clients so that sellers don’t have to worry about manually fulfilling orders themselves.
Holiday fulfillment center space crunch
It’s not unusual for an e-commerce retailer to find itself out of space at its primary facility or its secondary location during the holidays. Several factors, including seasonal hiring and training, increased orders, and a surge in returns, can cause this.
The best way to ensure you have enough space for your orders is to plan. Ensure you have adequate space available before peak season hits so you don’t have to scramble when demand increases.
Fulfillment center inventory accuracy
Another important factor to consider is fulfillment center inventory accuracy. The fulfillment center should be able to track what’s available and what’s not so that it can ship out orders as quickly as possible without compromising on quality.
If you have not done so, now is the time to ensure accurate inventory levels at your fulfillment centers. This can be done by taking a snapshot of your current inventory levels and comparing that data against what was planned for the holiday season to see if there are any areas for improvement.
Your fulfillment partner software should help you do that with ease.
Holiday fulfillment shrinkage
Shipment errors can occur during the holidays due to increased volume and more complex shipping patterns.
To avoid these errors, it’s important to have a strong e-commerce integration partner who can help manage inventory and make smarter decisions when it comes to routing orders through multiple carriers.
Tips for Managing Inventory for Peak Season
E-commerce inventory management is a critical part of running a successful business. The holiday season is one of the busiest for e-commerce, so you must have enough stock to meet your customers’ needs.
Here are some tips to help you manage your inventory during peak season:
Forecast inventory needs
The first step in managing e-commerce inventory for peak season is forecasting what products will sell during that time period. You need to know how much of each product you need to have on hand to meet demand and how many additional products you will sell during the peak season.
You can use tools like Google Analytics, Shopify, or Woocommerce Analytics to track your sales trends and predict when you’ll need more inventory.
Make sure that you have enough inventory on hand to meet your customer demand. During peak season, there will be a lot of competition between sellers, so you must ensure that your product gets delivered quickly and efficiently.
Stock up appropriately
Managing inventory levels is one of the main challenges of an e-commerce business. The last thing you want during peak season is to run out of stock or have to tell customers that they can’t buy from you because everything has sold out. So it’s important to keep track of how many items are in stock at any given time and ensure that there are enough available for customers who want them.
You might want to consider stocking up more than usual during peak times so that you don’t run out of anything too quickly because this could mean losing sales.
Track inventory levels accurately
If you don’t have accurate data about how much stock you have on hand, how can you know when to order more?
You should be able to track every single item that goes out the door and record exactly how much is left in stock at any given time. This will allow you to keep tabs on what products are selling well and which aren’t selling at all — so that you can adjust accordingly.
If you’re running low on an item, it’s better to stop selling it than risk disappointing customers with out-of-stock messages or delays in shipping.
You can remove items from your website or store them in your warehouse until after the holidays when you know more about future demand.
Make sure to connect your storefront
Make sure you connect your storefront with your inventory management system. This will allow the two systems to communicate with each other and ensure that there are no duplicates in your online store that aren’t already in stock.
How to Delight & Quickly Fulfill Your Holiday Orders
The holiday season is the most important time of the year for e-commerce businesses. It’s when customers are ready to spend and when you can earn a lot of new customers. But it’s also a time when you must be prepared to handle surges in demand.
Here are some tips to help you manage your inventory:
Choose the right shipping options
The first thing you need to do is decide what shipping options will work best for your customers and your business.
For example, if you offer free shipping but it takes longer than expected for them to receive their order, they may not be satisfied with their experience and won’t come back again. Choose a shipping method that gets packages from point A to point B in two or three days, so customers receive their items quickly and without hassle.
Extend your holiday selling season with local delivery and pickup
Get ahead of the competition by offering local delivery and pickup options during the holidays. Customers love having more control over their shopping experience, so give them the option to pick up their orders at a local store or office location. This helps build customer loyalty and increases customer retention rates.
Keep shipping alternatives
If you’re shipping items that don’t need to arrive by December 25th, consider using alternative delivery methods such as ground shipments or drop-off locations. This way, your customers don’t have to wait for their packages and can pick them up whenever it’s convenient.
It’s best to use traditional shipping methods where ever possible, but during peak times, you may need to look into alternatives like air freight or expedited service. These options may cost more, but they’re worth it if it means getting your packages there faster and more safely.
Deliver timely order tracking updates to keep customers happy
Customers will appreciate knowing when their order has been shipped and when it’s expected to arrive. Even if it’s not an exact date, at least give them some idea of when they can expect their package, so they know when to expect it and aren’t left wondering if something went wrong with their order.
Create an unboxing experience
The best way for customers to feel good about their purchase is to get a good first impression when they open their package. While it may seem like a small detail, there’s no reason why your packaging can’t be as beautiful and engaging as the product itself.
Take a look at this unboxing video from Crocs. It shows how much impact simple details like the box design and detailing make on your customer’s overall experience.
Plan how you’ll handle the influx of returns
Thinking ahead is the best way to prepare for the influx of returns.
Here are four steps you can take now to make sure you’re ready when the holiday rush hits:
Write a clear return policy
If customers have any questions about what’s allowed or not allowed on returns, they’ll likely ask before they make their purchases — and that’s something you want them asking as early as possible in their buying process. The more transparent and straightforward your policy is, the fewer questions you’ll have later on down the line.
Add clear return labels
Make sure your shipping labels clearly state that returns are accepted by your company and include instructions for how customers should send their items back. This will help them know exactly what they need to do before packing their boxes.
Designate appropriate holiday returns deadlines
If you’ve been running your business long enough, you know how busy it gets around the holidays — especially if you’re selling seasonal items like Christmas decorations or snow globes!
Make sure your customers know when they can expect their refund or replacement item — and ensure that your staff also knows this information. Be sure to communicate clearly when you’ll be out of stock so customers can choose another gift if necessary. That way, you can keep customers informed and aware of the proceedings.
Prep your warehouse
If you have the space, consider setting up an overflow area where returned products can be stored until your team processes them.
Make sure that this area is well-lit and airy — it should not smell like musty cardboard boxes or have flimsy or broken racks that could potentially damage merchandise.
Offer Free Shipping and Easy Returns
Offer free shipping on every order, at all times of the year, not just during the holidays. This helps encourage customers to shop with you year-round, leading to increased traffic, sales and loyalty.
Additionally, offer easy returns, so shoppers aren’t afraid to buy from you — even if they’re not sure about their purchase — because they know they won’t be stuck with something they don’t want or need if it doesn’t work out for them.
Create Custom Holiday Packaging
Create a sense of anticipation by sending out your orders in custom holiday packaging. If you have time, create a unique design for each order — like a snowflake or Santa — but if you need to ship quickly, make sure the design is simple and recognizable so customers can identify their packages instantly.
The holidays are about giving, so include a thank-you note or gift card inside each package. Consider adding something extra, like a candy cane or coffee mug, along with their purchase if you want to wow them!
Automate and Outsource Your Fulfillment Early
Lastly, the best way to prepare for holiday orders is to automate and outsource as much as possible. This includes inventory management software that helps you track sales trends and manage inventory levels, so you don’t run out of stock on popular items.
You should also look into using a fulfillment center that can handle order fulfillment for you so that you don’t have to worry about fulfilling orders by hand or having to hire temporary staff during the busy season.