The All-New AIM: Intelligent Forecasting + Inventory Planning

​Inventory​ ​Challenges During the Holiday Season

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The holiday season can be an exciting time for retailers and manufacturers. Businesses can expect a surge in demand, and hopefully, an associated surge in sales. However, the holiday season can also be a challenging time especially regarding your inventory control processes.

During the peak of the holiday season, your attention will likely be on other aspects of the business, so it is easy to lose control of inventory numbers, whereabouts and needs. Below, we examine the key challenges to inventory during the holiday season and offer some tips for getting around these.

The Holiday Season

During times of the year such as Christmas, Halloween, Easter and Thanksgiving, retailers and manufacturers can expect a spike in demand for various products. For example, in the lead up to Thanksgiving supermarkets will likely see a surge in demand for turkey, and in Easter, for chocolate.

Christmas will generally see an increase in demand for many things, as people flock to the shops to buy gifts for their loved ones. Likewise, in the build up to Halloween it is likely that there will be an increased demand for costumes and candies.

This can be an exciting time for manufacturers and retailers, as sales begin to soar and profitability goes up. However, these times of the year can also pose a real challenge to businesses inventory control processes, and their ability to successfully manage stock in general.


While it may be possible to predict, to some degree, an increase in demand at certain points of the year, the specifics will usually be hard to estimate. This can result in over-stocking, which can lead to monetary loss if businesses are not able to sell the excess and offset production costs.

Likewise, an exceptionally intense surge in demand may leave you under-stocked, and therefore may inhibit your ability to make sales. According to research from retail analyst firm IHL Group, companies worldwide are losing $634.1 billion every year due to running out of stock, and an additional $471.9 billion from excess stock.

This is problematic for businesses inventory control processes, because it can be very difficult to ascertain how much of each product you will need to meet demand during the holiday season. Failing to prepare adequately for these times of the year can greatly reduce efficiency and productivity.

Overcoming Inventory Control Issues

A great way to work around these challenges is by investing in reliable inventory software that can track your sales and predict sales trends to some degree. This will allow you some insight into the preferences of your customer base, and understanding this will help you prepare your inventory accordingly.

Relatedly, using this software you should be able to get an idea of which items tend to sell regardless of the time of year. Stocking up on items that are consistently in demand will mean you will be well-prepared for the busy period, and after the holiday period you will still be able to sell any left overs.

Lastly, this software will enable you to monitor cash flow in real-time. This is essential during the holiday season, as it can alert you immediately when changes need to be made, so that you are fully prepared for the busy period.

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Melanie - Unleashed Software

Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.

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