Businesses plan for the worst, ensure that they have inventory in time for the holidays
The holiday season is a busy time for everyone, but with this year’s worldwide supply chain complexities and inventory shortages, planning for the holiday season has been even more difficult for small business owners. Customers that are eager to spend money have started Christmas shopping almost immediately following Halloween.
The Christmas season is an important revenue generator for companies during the fourth quarter. Many businesses rely on this period for their yearly earning goals as well as growing their customer base through holiday shopping.
Like many small businesses, Nicholson-Hardie Nursery Lovers Lane and The Toy Maven in Preston Hollow have experienced delays in receiving merchandise. The key to preventing these delays was to order inventory months and months in advance.
“This year we’ve been planning for the fourth quarter since [the first quarter],” Toy Maven owner Candice Williams said. “We had companies telling us in March and April that if we wanted anything for the fourth quarter just to go ahead and order it all and receive the products, where normally you can space them out and say [you want them as time progresses, but] this year we had to take it whenever we got it because [the supplier] didn’t know when it would come.”
Luckily, The Toy Maven prepared for these in early 2021, as manufacturers warned they might experience delays. By ordering in the spring, they hoped to receive orders far ahead of the holiday season so it wouldn’t affect sales.
And sometimes it pays off to develop a good relationship with suppliers.
“We have had some shipment shortages,” Nicholson-Hardie owner Chris Bracken said. “Companies that we do not have a personal representative from, we have not been able to buy from. [However], companies that we have personal relationships with bend over backward to make things happen.”
These personal relationships have proven to be crucial in receiving products on time. Even though these companies are both smaller businesses, it benefited them to have such a close relationship with their suppliers as opposed to a large conglomerate trying to both stock hundreds of store shelves and keep the Christmas sales to the high bars they are held to.
“We’re unique in the specialty toy market because we do such large orders that we have really good relationships with the manufacturers,” Williams said. “I get to go to Los Angeles every year to see Mattel’s rollout. They invite a few small retailers, but you’re there with Amazon and people all over the world.
We had companies telling us in March and April that if we wanted anything for the fourth quarter just to go ahead and order.
Candice Williams, The Toy Maven owner
Crates full of toys piled up outside of the back entrance of The Toy Maven store, eight or nine pallets is what they are used to seeing about twice a week. The store was full of holiday shoppers and employees were actively updating and replenishing the shelves even in early November.
“We’re inundated with products, people are buying earlier and we’re bringing things out earlier,” Williams said. “Honestly this year’s sales have been through the roof with everyone back to normal seemingly but also the inventory is almost double than we normally have.”
The actual supply of the products was one issue, but additionally it became increasingly difficult to process and obtain goods on U.S. soil. With several ports being delayed for days including the port of Los Angeles, many companies have had to redirect cargo ships to ports that have the capability of holding the amount of product they are receiving.
“Some of the workhouses were shutting down overseas and container issues [became a problem because] they shot up from $4,000 to $20,000 per container,” Williams said. “[Manufacturers] would say that they knew what they had on the water now, but they didn’t know when they would have another replenishment.”
With early shipments and eager shoppers, The Toy Maven has been able to put out various holiday goods sooner than normal. Additionally, customers have returned to a state of semi-normality, which has prompted them to start shopping sooner especially with continued rising inflation which is currently 6.1 percent, calculated by the Consumer Price Index.
“We put out Christmas earlier than we ever have this year,” Bracken said. “We put it out a few weeks before Halloween and most other retailers did the same. We knew there would be a lot of problems with shipments the closer it got to the holiday rush.
Customers, aware of the supply chain delays and smaller inventories, became proactive and started shopping for the holidays earlier than usual.
When junior Cren Boyd began shopping for Christmas presents she noticed short supply and long delivery times. This situation prompted her to begin shopping earlier in the year.
“I noticed in early Nov. that the online orders I placed were often delayed or out of stock,” Boyd said. “Because of this I started to buy presents for my family and friends earlier in hopes I could get everything before Christmas.”
Additionally, most businesses rely on fourth quarter sales to meet various deadlines for the entire year so with the holidays being the primary component of yearly sales it was even more important to plan ahead of time. Customers have taken advantage of getting the shopping for the year out of the way as well.
“Christmas and spring are our busiest times of the year,” Bracken said. “Customers [came] out of the gates for holiday shopping way earlier this year! They are shopping today like it’s a week or two until Christmas.”