The holiday retail rush is upon us, and consumers are making their holiday shopping lists and checking them twice. Many businesses have been preparing for the peak holiday sales season for several months, but accurately capturing demand — and then aligning your supply — remains a challenge, especially as market volatility continues to throw a hat of uncertainty into the ring.
Recent events like the East and Gulf Coast port strikes have disrupted supply chains, and threats of a recession in the United States have made consumers more likely to wait for a sale before purchasing. However, Deloitte’s annual holiday retail survey found that shoppers are more optimistic and plan to increase their spending by 8% compared to last year, despite showing frugal and value-seeking behaviors across income groups.
All these factors and more make it difficult for businesses to forecast demand and optimize inventory levels that will see them through any peak sales season. In addition to inventory management, small and medium-sized businesses (SMBs) that operate with lean teams and on slim margins are often competing against larger retailers with deep pockets. But there are ways SMBs can level the playing field.
To reap success during the busiest retail season of the year and ensure growth and longevity, SMBs must embrace next-generation technologies to optimize inventory, automate processes, enhance customer experience, and align back-end operations. This is especially true with the National Retail Federation (NRF) predicting that holiday sales are poised for steady growth from last year’s holiday season.
Adopting Next-Gen Technologies for Overall Success
Next-generation technologies, such as artificial intelligence (AI), and machine learning (ML), are impacting businesses of all sizes and across industries. SMBs, especially those who sell physical products, can use these smart solutions to make critical aspects of their operations easier. For example, retailers must prioritize effective inventory management to avoid stockouts or overstocking during peak seasons.
For too long, many businesses have relied on guesswork or used enterprise resource planning (ERP) software made for much larger operations. But today, ML-based technologies can enable SMBs to plan and forecast demand by analyzing large swaths of historical data, consumer spending behavior, and market trends. This allows business owners to make data-informed decisions about inventory, which saves both time and money.
Automation is another benefit of next-generation technologies. AI assistants can help SMBs streamline daily tasks, such as transferring orders from customers via email into an invoice or creating purchase orders for restocking the shelves. With these tools, SMBs can adapt to the ebbs and flows of business in real time — whether during the holiday rush or slow seasons throughout the year. In fact, Gartner predicts that AI will be adopted by more than 80% of enterprises by 2026.
Onboarding Your New Tech of Choice
The benefits of utilizing next-generation technologies to optimize inventory levels, forecast demand, and automate reoccurring processes are clear. However, the first step in adoption is to prepare your business to move to the cloud. SMBs should look to technology providers that can walk them through the process and ensure they have all the information required to modernize their data and train staff on system changes.
As with any organizational change, businesses should plan for the onboarding process to take time, so it’s important to implement tech solutions early in preparation for the peak holiday sales season. Your staff needs to be able to confidently and efficiently use the new technologies so they can focus on revenue-generating activities, such as making product recommendations to customers and ensuring satisfaction — not putting out fires during a surge of demand.
The Key to Holistic Success: Syncing Customer and Back-End Tech Stacks
Many SMBs already have customer-facing technologies, such as virtual storefronts and payment systems, as well as back-end systems like shipping providers and accounting software. The key to optimization is ensuring these applications are perpetually in sync. Because inventory is at the heart of the business, it is critical to select an inventory management system that enables front- and back-end integration. In doing so, you can keep an up-to-date storefront, alleviate bottlenecks when processing orders, and ensure customer satisfaction at every turn.
With the holiday shopping season right around the corner and consumers starting to cross items off their lists earlier than in previous years, SMBs should look to these innovative solutions to not only streamline operations but also gain a competitive edge during the retail rush. Those who prioritize creating a holistically connected business and adopt tools for demand forecasting and automation will see benefits far beyond the peak sales season. Technology is a strategic imperative for SMBs, as it can help business owners navigate business cycles, shifts in consumer behavior, supply chain disruptions, and more.
Ben Hussey is the co-CEO of Katana Cloud Inventory, an inventory management platform that helps companies manage over $2.5 billion in sales annually. Ben has led many successful sales and revenue teams, helping businesses enhance their e-commerce, manufacturing, inventory, and order management capabilities while delivering amazing customer experiences. In addition to these roles, Ben spent a decade working for a large telecommunications company, leading commerce initiatives of varying sizes and types — from initiation to delivery and run-time. He’s passionate about the impact software can have on a business and working with high-performing teams to deliver results.
