How Chinese New Year Affects Brands, Retailers, and Local Shops?
Often referred to as CNY, or Chinese New Year. CNY effects the global supply chain for almost a month. This year CNY will begin on February 16, 2018, it is also known as the largest human migration. Workers travel back home to celebrate with their families. Can you imagine the traffic congestion? And some thought traffic in Los Angeles was bad. This human migration occurs every year, around February.
So, what does this mean for your business? Whether you have experience with CNY in the past, or this is your first time. We are here to help you prepare. We’ll answer what you should you do to prepare and what should you know before February 16, 2018.
As a business owner, you don’t want to be unprepared. It can have an adverse effect on your business especially if your business relies heavily on Chinese manufacturers or suppliers. With many brands, retailers and local shops codependent on Chinese goods and products — it is wise to plan ahead.
Rush Your Order
If you just realized the magnitude of Chinese New Year on your business, then contact your manufacturers and suppliers immediately. There is still time to place the last order. Start first with the relationships that you developed for previous shipments. Understand all possible options that they’ll offer you to get your inventory. Ask what they have done in the past for business owners, brands, and retailers. And then, try to rush your order. You’ll want to think about the amount of inventory you need through the holiday.
The Urgency to Get Your Inventory
Almost everything shuts down — for one month! You will need your inventory for March in February. If this is your first time experiencing Chinese New Year then calculate how much inventory you go through on average in one month. Account for lead time, in other words what is the approximate overlap of days when your next order will ship and be ready for your customers after the holiday.
Cost of Waiting Too Long
Steamship lines and your logistics company are businesses, too. They understand the increase of demand prior to CNY. First order in, first out. If you delay your order too long without leaving a window of 10 days to arrive into the port, then it may not ship on-time unless you can afford to pay the additional cost to expedite it.
What is the alternative to get inventory?
Alternative to get your inventory from China. Look to Vietnam, it may not come to mind as a large manufacturer but in fact Vietnam is the fifth largest country for moving textiles and garments in the world. They celebrate Tet. This is their Lunar New Year holiday and close down for around a week but nowhere as long as CNY in China. Vietnam is known for manufacturing in various sectors and industries, including food processing to tobacco and textiles to electronics.
High Demand May Lead to Low Quality
When workers in manufacturers are getting ready to leave but the demand is high. They are rushing to quickly get the orders out. Quality of your inventory is still a top priority to you, your brand’s reputation and business. A decrease of quality in your inventory can be noticed by your consumers, to reduce returns and keep customer satisfaction and loyalty. Connect with your suppliers and manufacturers, spend the extra money to get your quality control manager on-site to check your inventory. The reassurance of a complete inspection prior to your order(s) ship will provide you a sense of relief. The last thing on your mind should be the dissatisfaction of your customers due to a quality issue. This is the inventory you will have for one month or longer.
The best way to alleviate the stress and headache is to plan ahead, forecast what you should sell in the upcoming months including the orders you would normally make in March, and check your inventory for quality. Keep in mind, if you are an online seller on Amazon running out of inventory is the worst case scenario.
Contact us here or visit website, if you have any questions or concerns about your inventory management.
