Phil Chesworth explains how to keep up with warehouse changes caused by social media trends
Retail has always had trends, but the speed at which they can turn into sales has changed and grown far more unpredictable. A product can sit unsold for weeks before a TikTok video puts it in front of millions of people. Within hours, a retailer can be dealing with an order volume it had absolutely no way to predict. For customers, that immediacy is part of the appeal: a product appears in a video, catches someone’s attention, and, within moments, an order is placed. For the businesses behind those sales, things are rather more complicated than a few taps on a screen. The social media side of retail has become incredibly sophisticated, but the physical side still has to keep up. Orders still need to be picked, stock moved, and products sent out.
When demand changes overnight
This is particularly challenging for smaller retailers and SMEs, as many smaller warehouses are deliberately run as lean operations. Carrying unnecessary stock, paying for unused space or maintaining more equipment and staff than are normally required is not sustainable for them. Social commerce introduces unpredictability that makes those calculations harder. A warehouse might be perfectly capable of handling its usual workload, only to experience a sudden increase in orders because a product has gone viral. There is no gradual build-up to give the business time to recruit staff, reorganize the warehouse or change its processes; the workload arrives, and they have to deal with it. The whole movement of goods around the warehouse can change. Fast-moving products may need to be repositioned, stock replenished more frequently, and areas normally used for storage turned into temporary staging space in a smaller facility, creating a knock-on effect throughout the operation.
Technology is only part of the answer
There is understandably huge interest in platforms such as TikTok Shop and how creators and influencers can generate demand. The ability to turn entertainment directly into a purchase is changing the relationship between retailers and consumers. But generating demand is only half the job. If a retailer creates a viral product but cannot fulfill the resulting orders quickly, the opportunity can become a problem. Customers do not particularly care why their order is late: they expect the retailer to deliver, and fast. Technology can certainly help. Better inventory management, warehouse management systems, real-time data and automation can give retailers greater visibility and help them identify changes in demand more quickly. But I would be wary of assuming every problem can be solved by adding more technology. For many smaller businesses who cannot afford huge upfront investments, the answer might mean rethinking the warehouse layout, making better use of available space, cross-training employees or ensuring existing equipment can cope with a sudden increase in activity.
Planning for peaks, not averages
A business may have equipment that is perfectly adequate for its normal requirements, but social commerce can create periods when it is being used much more intensively. If it cannot keep pace, small delays quickly become larger backlogs. That is why I believe flexibility needs to become a bigger part of warehouse planning. Historically, businesses have understandably looked at averages: how many orders arrive on a typical day, how many people are needed to process them, and how much stock normally moves through the warehouse. Those figures are still useful, but social media trends do not care about the average. One product can sell steadily for weeks and then suddenly generate thousands of orders. Just as quickly, the trend might disappear. Retailers need to think about how their operations respond to peaks, not just how they perform under normal conditions. That does not mean every SME should invest in huge amounts of spare capacity in anticipation of a viral hit: it means building enough resilience into the operation so that an unexpected surge does not bring everything else to a halt.
The warehouse as part of the customer experience
I don’t think the answer is to try to predict every trend. That is, quite simply, impossible. The better approach is to accept that demand will be less predictable and build operations that can respond to it. Social commerce is not going away, even if the platforms and trends driving it continue to evolve. The next big retail trend might start with somebody filming a 30-second TikTok video, but the consequences will be felt much further down the supply chain. The warehouse may be a long way from the customer’s screen, but it is now an increasingly important part of the social commerce experience. When a product goes viral, the clock starts ticking. The retailers best placed to benefit will be those that have thought about what happens next, and made sure their warehouses are ready to move just as quickly as their customers are willing to buy.
Phil Chesworth
www.midlandpallettrucks.com
Phil Chesworth is Managing Director at Midland Pallet Trucks, a pallet truck specialist with a diverse range of models and specifications held in stock for immediate shipping. The company provides excellent customer service and top-quality pallet trucks at the best possible prices. All trucks are produced under ISO9002 certification and carry the CE, GS and TUV quality ratings and a full guarantee.