How to Cope When Product Demand Suddenly Surges
In this post, you will learn three of the key ways to cope with an increased product demand, even if it occurs in the blink of an eye.
Product demand surges can happen unexpectedly. In some cases, you might be able to anticipate this change. Either way, you need to be able to manage the spike. If you do not, your customer relationships might be damaged, and your bottom line will be hurt.
Whether the product was once only purchased by the odd customer or has just grown in popularity over time, you need to be prepared. In this post, you will learn three of the key ways to cope with an increased product demand, even if it occurs in the blink of an eye.
Assess Inventory Levels
With product demand high, inventory levels will fluctuate. This makes it difficult to make informed decisions that will meet customer needs, so you must have the data to driven these decisions. If you rely on real-time data instead of instinct and assess the inventory levels, the business will be able to navigate any sudden shifts effectively.
Of course, the primary reason of assessing inventory levels is to prevent stockouts, which will result in lost sales. You must have enough stock on hand to meet the increased customer demand, securing sales opportunities. This dodges the risk of brand reputation damage, as this is often the outcome of stockouts.
Your inventory management system (IMS) will be crucial in this task. The IMS will provide you with immediate, accurate data on current stock levels for your affected products. You might also need to complete physical counts. If so, conduct quick cycle counts of any high-demand items to verify the system’s accuracy.
Streamline Warehouse Operations
When demand suddenly rises, issues can occur. Critical areas, like picking and packing, could become overwhelmed, causing bottlenecks to form. This is why you must streamline warehouse options. A smooth, continuous flow of goods will be ensured, and it will also minimize incorrect shipment and other human errors.
There are numerous ways to optimize warehouse operations. One of the most effective methods is by creating “hot zones,” which means your fastest-selling products are moved to easily accessible locations. This minimizes travel times to the packing and shipping stations. Additionally, you could implement zone picking. Zone picking sees workers assigned to specific areas; this reduces congestion and increases efficiency.
In some cases, you might have a less stressful time handling increased demand. This is often the case with partnering with a third-party logistics (3PL) company. These services typically have the capacity and workforce for warehousing and distribution, even when product demand skyrockets.
Take this 3PL warehouse in Dallas, for example, which offers over 280,000 square feet of combined storage for a variety of products. Not only does it have the space for your goods, but it also offers the staff to distribute your products to customers.
Plan for Phased Product Delivery
How you deliver the products should be considered, too. A phased product delivery during a sudden busy period will mitigate risks and manage operational complexities. This will also ensure a sustainable and high-quality customer experience. Your business will not become overwhelmed by the massive, immediate fulfillment requirement. Without good planning, resources would become strained.
Releasing all orders at once when demand has risen means you are at risk of a system-wide failure. Starting with a smaller segment of orders is best. This allows you to identify and address any problems that arise in a controlled environment. You save your entire customer base from the impact of potential problems.
If phased delivery is the method you choose, be sure to align your internal teams. Everyone should have the same understanding of priorities, timelines, and customer messaging. Cross-functional alignment must be ensured between marketing, product, sales, and supply chain teams.
To conclude, a sudden surge in demand could be good for your profits, but it might be difficult to cope with. Thankfully, by following the tips outlined in this post, you will be able to handle changes in product demand easily.
