Supply chain and Black Friday: How to tackle issues as an SMB

As the holiday season fast approaches, everyone typically starts talking about the importance of being prepared with inventory and having a plan for post-BFCM fulfillment. This is normally to help tackle the usual supply chain pressure brought on by lots of demand in a short space of time. We expect this every year, but what happens when there are even more issues than usual? What happens when you planned to have fresh inventory just after Black Friday, but it won’t arrive until the new year? 

We’re going to look at how supply chain issues impact SMBs over Black Friday weekend, and what these businesses can do to maintain a great customer experience. 

What’s happening with the supply chain?

When the global supply chain is healthy and functioning, it’s great for everyone. As an ecommerce merchant, your suppliers get the materials they need to make your products. Your inventory arrives when you expect it to. Your customers’ orders ship and arrive on time. However when a link in that chain fails, it has a knock-on effect and can cause the entire supply chain to come to a standstill. Your suppliers can’t get what they need, you don’t get your inventory, your customers can’t make a purchase. That’s what’s currently happening around the world.

How everyone reacts to these sorts of issues varies depending on the size and scale of the business in question. Big box retailers like Walmart are chartering extra ships, and hoarding stock of products they expect to be popular like PS5’s. Meanwhile Amazon is trying to entice more workers with bonuses to help ease their labor shortage, and increasing their warehousing capacity to maintain stock levels. Further afield, Alibaba are expanding their warehouses out of mainland China for the first time to improve last-mile logistics. 

The big players in ecommerce are able to take these major actions to secure their holiday sales. They have the money, resources, and bargaining power to do so. However this leaves everyone smaller in a more difficult and more volatile position. SMBs - small and medium-sized businesses - can’t afford to take the same actions as retail giants, and this means they need to take an approach that mitigates impact but still delivers the experience their customers expect. 

How will this impact Black Friday/Cyber Monday?

Supply chain struggles have been ongoing for a while now, and they won’t be resolving themselves anytime soon. Even if issues start to ease tomorrow, it’ll take a significant amount of time and effort to clear backlogs and get back to regular operations. Ecommerce merchants will already be more than aware of the issues that their supply chain usually faces around this time of the year, with increased pressure and demand globally as more people order online in preparation for the holidays. This will only compound problems, and this will inevitably impact Black Friday weekend.

Specifically, it’ll lead to more and earlier out-of-stocks, as well as delayed shipping times and increased costs. This then has a major impact on the customer experience. Even if the customer is aware of ongoing issues, they will still lay the blame on the merchant if their perfect present is either out of stock or doesn’t arrive in time. That has a knock-on effect on future acquisition and brand perception, as customers won’t wait around for a brand they perceive to have delivered a poor experience.  

How tackle BFCM and supply chain as a SMB

Despite what initially appears to be a very difficult outlook, there are still ways for SMBs to manage supply chain issues and deliver an excellent BFCM experience for their customers. The answer lies in being prepared, keeping communication open with custoemrs, and offering alternatives when out-of-stocks do start to appear.

Maintain excellent communication

Your key to ensuring supply chain problems don’t have as big an impact on your customer experience is communication. Customers want brands to communicate with them, 84% of consumers expect regular communication about their order. Use the channels you have including social media, email, and SMS, to keep your customers up to date with what your plans are and how orders are progressing. If fulfillment is delayed, send updates to all affected orders. If you have low stock of a particular product and don’t expect a restock before the end of the year, post on social media and send browse abandonment emails. By not communicating more throughout the holiday season about potential issues, you’re only inviting more customer frustration and risking acquisition as customers are unsure whether or not they can trust your store to deliver on time.

Out-of-stock plans

It’s inevitable even in a year without supply chain problems that items may run out of stock over Black Friday weekend. When you have limited supply and a high volume of bargain hunters visiting your store, at least one person will be left disappointed. That’s why it’s vital that you have an out-of-stock plan that faces the issue head-on and has the potential to turn disappointment into a satisfied customer. 

Govalo’s out-of-stock gift card integration is an essential tool, giving customers the option to instead purchase a gift card if the item they want is unavailable. If they’re there to purchase a gift, chances are they’re already set on buying from your brand and want the recipient to have something from your store. Therefore a gift card is an attractive second option, and one which their recipient is likely to enjoy. It saves you team time trying to figure out what to do with an out-of-stock product, giving an automatically great solution for your customers without any added effort. Gift cards are also increasingly being seen as a strategy for merchants to combat supply chain woes


Bring your sale activity forward

If you want to make the most of the holiday sale season, then consider bringing forward your sale activity. Shoppers are already looking for and purchasing gifts and many other retailers are already starting to promote their seasonal sales, so there’s no reason to tie all your sale activity to Black Friday weekend if doing so will put your team under pressure. In fact, early sales could give you an edge over the competition, as BFCM is typically so loud with competition that it can be difficult to truly stand out. If you want to retain some promotional activity for over BFCM, look at how you could split up your planned promotions into a longer term sale campaign hosting early bird sales, flash sales, and finally some bigger promotions over Black Friday.

Prepare to move order deadlines

Even if you have the inventory, it still needs to make it to your customer in time after Black Friday. If you want to be prepared, then you may want to move your order deadlines forward. This will give your team and fulfillment chain the time they need to ensure deliveries go ahead and arrive on time. This doesn’t mean that you’ll lose out on those last-minute sales, however, you just need to have options ready to sell after that order deadline has passed. That’s where gift cards come to save the day once again, as 44% of last-minute holiday shoppers say they plan to buy gift cards. Promoting these once your deadline has passed along with expected restock dates on out-of-stock products will allow you to continue selling even when physical orders stop heading out the door.

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With a little extra preparation, you can not only mitigate the impact supply chain issues have on your store over Black Friday but also potentially see the sales growth typical of the holiday season. By being ready to adapt and shift sale activity and deadlines, and have a strategy ready to tackle out-of-stocks, you’ll be able to continue to delight your customers.