Understand ecommerce Peak Season to fulfill brilliantly

Faced with surging demand, supply chain issues, and shipping cost—it is make or break time, and for those who are prepared—it represents peak profits. During this time, warehouses and fulfillment centers become vital hubs, ensuring the massive influx of orders gets processed accurately and promptly. However, to succeed, high-volume fulfillment operations must use the right strategies and warehouse management software to fulfill orders in the best possible way.

Successful Peak Season strategies depend on leveraging AI-driven fulfillment management systems (FMS), like Logiwa IO. Even for companies looking to take advantage of AI in logistics for the looming 2024 peak season, it’s not too late! Logiwa IO fits seamlessly into most existing operations for effortless scaling and is ready to support logistics and meet changing business demands. Schedule a call with one of our fulfillment specialists to learn how quickly you can put the power of AI-driven fulfillment to work in your warehouse.

Understanding Peak Season challenges

To fulfill brilliantly this Peak Season you must first understand the inherent challenges.

So what exactly is Peak Season? Traditionally beginning around October and lasting through the end of the year, peak has expanded to describe any period when consumer activity increases and a high volume of orders are placed. With today’s consumers shopping online and brands eager to capture sales, peak can seem to be year round. Regardless of when it falls, Peak Season presents specific challenges.

Increased demand

Logiwa issued a study that found at least 75% of warehouse and fulfillment management centers experienced a 10% increase in sales during peak season. While more sales are welcomed, the uptick in demand places an enormous strain on inventory management, logistics systems, and customer service, as the surge amplifies the number of shipments, stockouts, returns, and service inquiries.

Surging costs

During Peak Season, costs increase, especially for shipping and transportation as higher demand inflates transportation fees, tariffs,  fuel expenses, and labor costs.

However, it’s not just deliveries, storage, and shipments that are more expensive. Warehouse logistics teams also deal with tighter schedules to avoid delays, given that consumer expectations spike during the holiday season.

Labor shortages

Around 48% of warehouse executives cite labor shortages and turnover as a top concern during Peak Season. Managing a seasonal labor force is highly challenging, as it’s difficult to find workers willing to commit to short-term work, which can cause employers to raise wages or offer bonuses to incentivize them to bring them on board and stay on board.

Hiring is one challenge, but retaining and training employees remains an even bigger one. These tasks require 3PL coordinators to adjust schedules for overtime work and cross-training, all while avoiding overworking employees so they don’t burn out.

Using analytics for demand forecasting

Peak Season is a challenge, but a surmountable one. Companies must consider both the past and future, leveraging previous sales data and market trends to estimate seasonal demand. For example, taking account of past sales through the years provides a baseline estimation. However, prior data should always be coupled with emerging market trends that could influence future sales.

Finally, 3PL coordinators must take past and future insights and enhance them by incorporating machine learning. Machine learning and analytics safeguard peak season planning by scraping additional data and using algorithmic logic to make predictions, which can produce key insights concerning staffing, inventory, transportation, and demand.

Advanced Fulfillment Management Systems (FMS)

From customer service to order tracking to packaging, advanced FMS systems automate tasks and reduce the burden of manual labor, which can ease the fear of labor shortage and workplace safety concerns.

Automated systems can spot real-time demand patterns and cyclical trends to optimize the entire supply chain, including warehousing and order fulfillment, to improve efficiency, bring down costs, and boost customer satisfaction.

Leading FMS systems, like Logiwa IO, deliver features like directed putaway, picking automation, and rate shopping to support productivity, streamline order fulfillment, and lower costs.

Watch this QuickTake webinar to learn how easy it is to save with Logiwa IO’s rate shopping.

Enhancing workforce flexibility

Peak Season demands companies build a flexible workforce of full-time, part-time, and temporary employees, and demand can require labor needs to switch on a dime. FMS systems make it easier to manage labor forces.

Another huge logistical challenge during peak seasons is employee training. Again, FMS like Logiwa IO feature a highly intuitive UI/UX to onboard employees, making it easy to train existing workforce and bring on temporary staff.

Warehouse efficiency also requires that companies implement and train according to established labor standards, such as a set picking method. Labor standards provide benchmarks for evaluating employee efficiency, but evaluations require connecting a complex network of data points. Logiwa IO compiles these data points, using AI-driven analytics to establish realistic and relevant labor expectations so employees know exactly what’s required upfront.

Leveraging automation and robotics

Robotics and automated machinery can be key for meeting peak season demands. Depending on your warehouse, self-driving automated guided vehicles (AVGs) can be used for material handling and load carrying. Logiwa easily integrates with today’s wide range of robotic vehicles.

Effective returns management

During Peak Season, spikes in returns should be expected. Therefore, return policies must be clear and efficient, with communication through multiple channels such social media, the company website, and packaging.

When it comes to return policies, FMS systems enhance reverse logistics insights and tracking, which is key to customer satisfaction. A quality system processes returns quickly, analyzes data to identify trends, and updates inventories to reduce misunderstandings that lead to stock issues.

Continuous improvement with performance metrics

Warehouse management must track many KPIs to create the most productive and cost-friendly environment, including:

• Order processing time
• Accuracy rates
• Inventory carrying costs
• Inventory shrinkage
• Picking and packing costs

However, attempting to track such KPIs manually is a huge burden, which is why a tool like Logiwa IO is critical for managing data. Once data is captured, the system processes it to make real-time adjustments that improve Peak Season operations.

Discover the best warehouse software solution

Leveraging AI and machine learning with predictive analytics is key for supporting warehousing and fulfillment efforts during the height of peak season. Not only does it address key challenges like increased shipping costs and labor shortages, but it also strengthens initiatives to make workforces and processes more productive and efficient.

Any warehouse or fulfillment center looking to have a successful 2024 Peak Season should consider partnering with a trusted and tested AI-powered FMS to implement these strategies and tech solutions. That’s where Logiwa comes in.

Prepare for Peak Season by scheduling a free demo with one of our Logiwa fulfillment experts. They’ll explain exactly how Logiwa IO will fit directly into your company’s existing tech stack to boost revenues, bring down costs and waste, and help manage labor forces effectively, regardless of how long your Peak Season lasts.

FAQs about Peak Season success