Brexit Bother: When To Secure Your Inventory Before Christmas

Customers are frantically searching for the best Christmas gifts, decorations, and food - and with COVID-19 repercussions and Brexit in full swing, this is having a massive impact on the distribution and eCommerce world. With 87% of UK households buying online in 2020, meeting demand for Christmas 2021 may be no different.

But what exactly does this mean for inventory management? Supermarkets and retail stores are already seeing shortages of stock on the shelves (that’s a tongue twister), but when is the right time to secure more inventory for the Christmas rush, before you risk falling short?
 

There’s lots of advice and guidance out there to help limit stockpiling this Christmas period - but preparation is key, so let’s take a look at when to secure your inventory before Christmas and how you should do this.

 

Expand warehouse operations


If possible, it may be worthwhile expanding your warehouse operations during the Christmas period. Many brands choose to do so anyway, as demand increases around this time of year. But with the backlash from the pandemic and Brexit supply issues causing problems, it might be recommended to extend warehouse operations into the new year too. 
 

Stockpiling might be a necessity for your business, especially with changes to EU trading laws, but it’s important to do so intelligently. Analyse current stock to see how things match up to current demand - but don’t rely on last year’s figures and data to give you a good insight. Everything keeps shifting and changing, which means forecasts have to be treated as just that - an educated guess. 

Once you have this information to hand, you can organise more warehouse space, expanding your operations and giving yourself a little breathing room. This can help in the new year too, with further EU law changes and Brexit negotiations. 

 

Work closely with suppliers


The start of the Christmas ‘peak’ for retailers and eCommerce companies usually starts at the beginning of October, but panic around meeting demand usually doesn’t occur until a few weeks before the big day. With Brexit and COVID-19 causing problems for the supply chain, retailers have already seen that panic set in.

According to Bloomberg, even from October, brands are already struggling with supply chains, with this Christmas causing even more problems than in 2020. Transportation and shipping issues are panning out to be the biggest hold-ups - so it’s vital you’re working closely with suppliers to know how long disruptions will last and what you can do in the meantime.

And even if you only use UK suppliers, remember, they need to get their supplies from somewhere, whether that’s the actual product or packaging etc. Brexit will still have an impact on you, regardless of whether you import from or export to the EU.

Can you potentially start using UK only suppliers? This will help reduce your carbon footprint and limit disruption to stock if coming straight from inside the UK. Although you may see an impact on costs, this could potentially level out in the future, especially as importing becomes more of a headache…

 

Don’t get stuck with stockpiles


Let’s learn from past mistakes. When Brexit was first announced and the pandemic began, supply chains were immediately disrupted. We saw consumers go into panic mode (and understandably so), which meant huge demands on brands to gain more stock, navigate transportation disruptions, as well as some industries dealing with a surplus of stock. 

Consumers were only thinking of the necessities to purchase, which meant brands who were used to a surge in demand found themselves stuck with excess stock. 

These fluctuations in demand meant many companies tried to plan ahead, ending up with huge stockpiles of unnecessary products - which they’ve still not managed to shift. Although it can be incredibly difficult to forecast demand in such unpredictable times, it’s better to not end up with huge stockpiles, taking up precious warehouse space.

Instead, invest in more efficient supply chains, stock forecasting software, as well as customisable shipping software, ensuring you can adapt to and meet constantly changing demand. Optimising your inventory will ensure you can analyse current stock levels well, spotting when products are at an excess and therefore what needs to be shifted and when.

 

Ensure you utilise inventory optimisation


If possible, try to reduce stock levels whenever you can during the Christmas period. Whatever your ‘normal’ stock levels look like, you may perhaps increase this during October through to January. However, an excess above this level will impact your cash-flow. Only keep stockpiles of products that will be met by demand and utilise inventory optimisation to ensure you know what these are.

Can you outsource stockholding? This means you don’t have to invest in additional warehouse space if you don’t think you’ll require it after the Christmas period. This can often be a more cost effective way to manage inventory optimisation - as the strain is taken off you and passed on to a third party. Ensure it’s a partner you trust, however.

 

Improve efficiency


Preventing supply chain issues and minimising disruption to your operations is essential, especially during the Christmas period. You can improve efficiency by identifying any problems that could impact these - at least, the predictable problems.

Having a streamline operational process in place, as well as the right technology and shipping partners, will ensure your cash flow is kept in check and supplies are delivered in a timely manner. Implementing contracts and legal agreements for your suppliers can provide some protection in uncertain times.

Reviewing your inventory strategy over the Christmas period will help get you set up for the new year, with navigating Brexit and EU law changes. You need to think about flexibility and operational ease, employing smart tactics and engaging with third parties to ensure all your needs are met. If your Christmas inventory tactics can provide you with a better solution to Brexit in the new year, it might be worthwhile leaving them in place.