Preparing for Holiday Inventory with Short-Term Storage

The fall season is just beginning which for retailers means the start of the holiday season.  While the general population may not be ready to do their holiday shopping just yet, many retailers are already building their inventories to get ready for holiday shoppers.  As retail stores inflate their inventory for the holidays, they are likely to run into storage issues as they may not have the storage space to stock their holiday inventory.

In this guide, we will discuss best practices for managing holiday inventory as well as securing short-term storage.  It is important for retailers to have a plan in place to manage their inventory and storage to ensure an efficient and profitable holiday season.

Holiday Inventory Management

The holiday season is the busiest season for retail stores and most retailers are also dealing with an inflated inventory during this time.  It is important for retail stores to manage their inventory effectively to ensure they are properly stocked for the holidays.

The following are best practices for managing holiday inventory:

Ensure Accurate Forecasting

Accurate inventory forecasting is important to ensure that you have enough stock to meet customer demand.  However, forecasting seasonal inventory can be difficult as consumer behavior is not always predictable heading into a holiday season.  These strategies can help ensure accurate forecasting:

1. Review historical data:

   Review your sales reports from the previous holiday seasons to see which items sold the most and how many items were sold. If you notice trends over several previous holiday seasons, you can likely expect the same trends this holiday season which can help you determine which items you need and how many.

2. Current trends:

   It is also important to consider current trends in customer demand to help refine your forecasting. If your historical data reflects a higher demand for a certain product than the current market, then you should adjust your forecast accordingly.

Inventory Visibility

For most retailers, the holiday inventory may be spread out between storage in the back of the store, offsite warehouses, and transit routes.  Investing in inventory visibility allows you to track your inventory in real-time to get an accurate report of your stock across storage locations.  This can help you identify items that are running low so you can replenish in time to avoid running out of stock.

Audit Your Inventory Regularly

Retail stores that do not have inventory visibility software need to do regular audits of their inventory to keep track of stock.  When auditing your inventory, take note of your best-selling items as well as items that do not sell in high volumes.  You can then plan on slightly increasing the inventory for your highest selling items while removing low selling and aging inventory to make more room for your top selling items.

Work With More Shippers and Suppliers

While many of the supply chain issues caused by the pandemic seem to be more stable, it helps to expand your network of suppliers and shippers, so you are not stuck if something goes wrong.  Consider working with a domestic supplier or manufacturer that can restock items if your primary supplier runs out.  Adding an additional logistics provider will ensure that your items are always delivered on time to meet customer demands.

Build Safety Stock

It is important for retailers to make sure they have enough holiday stock to avoid running out of popular items, but not too much that they end up with overstock.  Building a safety stock of popular items helps ensure that you can fill unexpected demands and continue generating revenue.

To determine how much safety stock you should build, calculate how many items you expect to sell per day and based on this number, decide how many days’ worth of safety stock you want on-hand.  Ordering too much safety stock takes capital away from other operations and leaves you with excess stock to manage after the holidays.

Order Early to Replenish Stock

Consumers start shopping for the holidays earlier each year which makes it important to stock up on popular items as soon as possible, preferably in October.  Stocking up early will ensure that you are ready no matter how early people start their holiday shopping.  You should also put a plan in place to replenish your stock during the holiday season so you can be ready for demand spikes and prevent running out of items that are most in demand.

Plan for Stockouts

Forecasting demand for specific items is not an exact science as even with accurate forecasting, stockouts are still a possibility.  Some businesses may notify their customers when they run out of stock and when they have restocked, but only a small number of consumers wait for an item to come back in stock.

The best solution is to continue selling items on backorder and generating revenue.  Make sure customers who order items on backorder are aware that the item is currently out of stock and let them know when they can expect the item to be in stock again.

Plan for Overstock

In addition to planning for stockouts, you should also have a plan in place for overstock.  It is common for retailers to end up with overstock of low demand items after the holiday season and it costs businesses money to continue hanging on to the stock.  When this happens, you can do one of the following to help move overstock after the holiday season:

1. Promotional offers:

   Create a promotional offer in which you offer the overstock items at a discounted price or as part of a discounted bundle along with more popular items.

2. Holiday marketing campaign:

   An effective holiday marketing campaign implemented throughout the holiday season can promote all of your products and direct customers towards specific products to help avoid overstock.

3. Charity donations:

   Donating overstocked items to charities after the holidays helps you free more space for new products while contributing to a good cause. Your business can also claim the charity donations as a tax deduction.

4. Recycle:

   If none of the previously mentioned strategies help eliminate overstock, you can recycle the overstocked products. This not only frees space for new products, but also reduces your environmental impact.

Holiday Short-Term Storage Tips

Virtually every retailer will have an inflated inventory during the holiday season and may not have the storage space in their own stockrooms or warehouses for their holiday inventory. Many retailers work with third party warehouses that offer short-term storage to help with holiday inventory. Efficient short-term storage solutions can help retailers better manage their holiday inventory and save time and money.

The following tips can help you find effective short-term storage solutions for the holiday season:

1. Find storage the meets your needs:

   You must first determine your specific storage needs, including the amount of space, length of time you need storage, and whether you require specialized storage such as refrigerated storage. Understanding your specific needs will help you find storage solutions that accommodate your needs.

2. Reserve storage early:

   As the holidays approach, short-term storage solutions will be in higher demand. Reserve your storage units in advance so you are ready when your holiday inventory begins to arrive.  This will require some planning as you need to determine your specific storage needs and how much inventory you will receive to ensure you reserve enough storage space.

3. Use one provider:

   For the sake of efficiency, it is best to use one warehouse service provider to handle all of your storage needs. This will prevent you from having to enter multiple contracts with different warehouses which can save on costs and ensure that your inventory is on one place for more efficient inventory management.

4. Ensure fair pricing and terms:

   Some storage providers may increase their prices and minimal storage requirements for the holiday season while decreasing storage lengths. When you are looking for storage solutions, make sure you will get a fair, flat rate that will not increase during the holiday season.

Find Short-Term Storage Solutions for Holiday Inventory with OLIMP

As the holiday season approaches, effective inventory and storage management are crucial for retailers to maximize profitability and meet customer demands.  By following best practices such as accurate forecasting, building safety stock, and auditing inventory regularly, businesses can ensure they are well-prepared for the holiday rush.  Additionally, securing short-term storage early and working with reliable providers can help retailers manage their increased inventory efficiently.  Implementing these strategies will not only help avoid stockouts and overstock but also ensure a smooth and successful holiday season.

Businesses looking to book short-term storage for the holiday season can work with OLIMP to secure a short-term storage solution.  OLIMP is an online platform that simplifies the process of booking warehouse storage services that fit your exact needs.  Our network includes thousands of vetted warehouses throughout North America that have space available for short-term holiday storage.  With our platform, you can specify your specific storage needs and compare pricing from different warehouses in your area.  The warehouses in our network not only provide short-term storage, but also offer local last mile delivery to get your inventory to your stockroom.

Through OLIMP, you can book warehouses across the U.S., Canada, and Mexico to fulfill your short-term storage needs for the holidays.  Get started with OLIMP by requesting a quote.