As retailers gear up for a busy season of Black Friday, Cyber Monday and Christmas sales, retail logistics experts from Advanced Supply Chain (ASC) and ReBound Returns look at how they can overcome this year’s peak pressure points.
1) Sales surges
Recent years have seen retailers and consumer brands successfully stretch Black Friday from one-day of price cuts to a weekend sales event, through to a month-long promotion. It’s a strategy that’s helped to secure earlier sales in November and smoothened the intense pressure of a sales spike across one day or weekend. However, are sales patterns changing?
Industry reports show pent-up consumer demand during November 2024, with shoppers waiting until the Black Friday, Cyber Monday (BFCM) weekend to secure the best deals. Cyber Monday has also become increasingly popular, with sales topping £3.3bn last year, according to VoucherCodes.co.uk. Will volatile consumer confidence and economic uncertainty cause shoppers to hold out during this year’s peak for the biggest price cuts and how does this impact retailers?
“Lingering consumer concerns about job security, rising taxes, energy costs and inflation can make shoppers extremely price sensitive,” says Stuart Greenfield, European sales director at ASC. “People will be seeking best value prices and are likely to hang tight with spending until the main BFCM sales event at the end of November.
“The challenge of this for retailers is the rapid and efficient replenishment of stock inventory. Black Friday spikes can deplete stock levels overnight, which must be remedied within 48 hours to ensure there’s sufficient stock to satisfy a secondary spike on Cyber Monday. Dealing with this rapid turnaround of inventory could be even more difficult this year, because retailers have diversified and expanded supplier networks to manage the impacts of rising supply chain costs, including changing tariffs.
“An unwelcome consequence of this is retailers are receiving goods from many different suppliers around the globe, in varying packaging and labelling formats. There is little consistency, and compliance with retailers’ supplier manuals is few and far between. Inbound goods aren’t ‘retail ready’ and need reworking so they are compatible with retailers’ systems and brands, which eats up precious time during the BFCM weekend.
“Automated and digitalised systems can help solve these problems. For example, mobile kiosks in warehouses can standardise and streamline packaging and labelling formats, driving retailer compliance and avoiding order rejections and time spent fixing errors. Kiosks can be connected to transport management systems, helping optimise fleet scheduling, so inbound vehicles arrive at warehouses at the right time. This supports efficient Just In Time inventory and can avoid a risk of vehicles wasting time, queuing for loading bays during the time-critical BFCM weekend.”
2) The returns rush
Sales spikes often cause a spike in customer returns. “Deep discounts, seasonal holiday purchases and gifting can encourage impulse purchasing and a general trend of bigger baskets during peak,” said Cristina Parlogea‑Cirstea, customer success manager at ReBound Returns.
“Shoppers will generally purchase more than usual, wanting the freedom to take advantage of flash promotions and to have a choice of outfits for festive occasions, as well as checking out possible Christmas gift options for family and friends. Not all purchases will be kept, and retailers face the challenge of processing higher volumes of returns in short timeframes.
“Goods coming back into warehouses and fulfilment centres need sorting quickly for two critical reasons. The first is to get products back into the sales cycle to meet customer demand before peak shopping days disappear. The second reason is to deliver a positive customer experience through quick refunds. ASC and ReBound data shows two-thirds of shoppers will spend again after making a return, as long as they are refunded with two – three days of sending an item back.
“Returns management systems must be based on clearly defined grading processes, so that quick and effective decisions can be made about the quality of returned items. Product inspections can be streamlined to ensure goods are quickly diverted to the most appropriate next stage, whether that’s cleaning, repair, or repackaging – meaning quality control is confidently completed and a swift customer refund can be authorised.
“Effective grading of returns can also provide retailers with valuable data and insight, which can be used to further optimise returns processes to manage costs, save time and enhance customer satisfaction – all factors that can deliver a competitive edge during peak.”
3) Flexing peak policies
An increase in volumes is not the only returns-related peak pressure that retailers are facing. Many are also contending with adapting their returns policies during peak to make these more shopper friendly. Extra time will be allowed for customers to keep or return items, with returns windows extended from a standard 28-days up to 60-days or more.
Parlogea‑Cirstea explains: “Peak is an opportunity for retailers to attract new customers and build brand loyalty that drives repeat purchasing long after the Christmas decorations come down. Therefore, it’s vital that shoppers are kept happy and returns is seen as a game changer for this.
“Returns policies will be flexed to fit with peak shopping habits. Shoppers will snap up BFCM deals to save money on gifts but know there’s a possibility that purchases may have to be changed in the New Year. Giving consumers the ability to do this allows them to confidently shop during popular sales events.
“The changes in returns policies during peak can bring certain operational challenges, such as higher return volumes during January and even into the beginning of February. This can cause warehouse congestion and delayed stock reintegration, risking issues of product availability and leftover seasonal stock.
“Addressing these challenges requires preparation. Retailers should be speaking with returns and logistics partners and sharing information about major sales events and specific price promotions to prepare detailed forecasts. Capacity and inventory can then be better planned, with returns levels and timings anticipated to effectively handle the movement of items being sent back.
“Ultimately, the key to managing extended return windows effectively lies in proactive planning, transparent communication, and close cross-functional collaboration. These are all factors that can enable retailers to balance consumer friendly returns policies with operational requirements.”
Click here to find out more about how to improve efficiencies in retail logistics, or email: enquiries@advancedsupplychain.com / https://www.advancedsupplychain.com
