COVID-19’s impact on consumer holiday shopping will strain distribution operations, survey finds
Surge in demand for online shopping and for a wider variety of tricky items from a pick-and-pack perspective will place pressure on supply chain
A recent survey of 500 U.S consumers indicates significant changes in consumer shopping intentions, such as plans to purchase small, difficult to pick and pack stocking stuffer items online. As a result, ill-prepared distribution centers will struggle to meet consumer expectations in what is expected to be a make-or-break buying season.
Seventy six percent of respondents intend to purchase more than half of their gifts online. The report expects last-minute shopping to move more permanently online, with 62% of respondents planning to purchase more stocking stuffers and last-minute gifts online
The survey found that 51% of respondents expect to begin holiday shopping earlier than normal this year and 57% of respondents plan to have more gifts shipped directly to recipients than last year.
These reactions are indicative of consumers’ desire to reduce the risk of exposure to COVID-19 by limiting time spent in physical retail locations and highlight the increased role that e-commerce will play in 2020. Safety concerns are undoubtedly compounded by the challenges consumers faced trying to obtain scarce products or delays in receiving products that were in stock but deprioritized for distribution at the height of the COVID crisis.
New expectations present serious challenges for promoting products, inventory stocking and cost-effectively selecting and fulfilling orders.
Distribution centers accustomed to sending one shipment per order will increasingly be expected to ship items within a single order to multiple addresses. They must also strategize the most efficient way to pick and pack small items at the apex of the holiday season.
COVID-driven behaviors require rethinking how to optimize item selection, order sorting, label printing, packing order confirmation forms and boxing – not to mention how to handle gift wrapping services.
“While the holiday season is always an important time of year for every retailer, this year the magnitude is more critical than ever. For many retailers, survival will rely on a successful 2020 holiday season due to the tremendous slowdown retailers faced during the pandemic,” reminds Keith Phillips, President and CEO of Voxware.