Title: Mitigating Risks: Preparing for Holiday Supply Chain Instability (2022)

The most wonderful time of the year is upon us. However, we’re seeing some serious supply chain instability that could rock the foundation of even the savviest food and beverage manufacturers (if they aren’t prepared, that is!)

While there is already tangible strain in the distribution area of the supply chain, problems are not currently forecasted to entirely disrupt the holiday season, allowing you a window of opportunity to pivot, strategize, and profit. 

Below, we’re digging into the different ways you can mitigate the risks of supply chain instability in your food and beverage business and offering insight into how you can optimize your manufacturing and distribution strategy – starting today. 

How do holidays affect the supply chain? 

The holidays affect the supply chain in several different ways. Most notably, consumerism is at an all-time high – driving sales and profit margins higher than in other quarters. Costs may also soar due to the scarcity of manufacturing items, the current instability in the global distribution infrastructure, and record-setting inflation. 

Are food and beverage businesses impacted by holiday supply chain instability?

Yes, they can be. However, even if your business is less profitable, know that you still have time to restrategize and adjust your operation. 

Consider this: Food is a non-negotiable focal point of the holiday season. Because of this, impacted consumers have two main options: Pull back and spend less than prior years, or continue to purchase their holiday favorites and novelty items however possible. 

Both groups mentioned have one thing in common: They are looking for the best possible deals on their holiday food and beverage items. 

How can I mitigate risk of lost profit from supply chain issues in 2022? 

Let’s explore some of the ways you can leverage the current holiday supply chain effects into a higher profit and tighter operational strategy. 

Localized shipping and distribution options 

Choosing to source alternative and secondary distribution options is a strategic move to make, given the current climate in the food and beverage industry. Vendors have already been seen having delays in sourcing essential ingredients and common crops for some of the most mass-produced products in the industry – and you wouldn’t want to compromise the customer experience or food quality with an unreliable delivery service. 

Going the extra mile to strategize your distribution plan is worthwhile, even after the holiday supply chain disruptions settle. It allows you to reduce your brand’s overall environmental load, and get you one step closer to those ESG goals. You may also enjoy faster turnaround times on delivery and a more concierge level of customer service, especially if you go with a smaller distribution vendor or specialty service. 

Lower prices and flash sales 

People love novelty. You may consider tapping into that and offering flash sales on certain segments of your products, seeing which items resonate with your demographic most. If you pair this effort with an aligned social media campaign, this can be an incredibly effective way of moving product – especially if you already have a significant brand presence on any or all of the popular channels. 

Alternatively, you can work to lower your prices to stand out as the most affordable option among your competitor base. RAIN Group has found that need and budget are the two driving factors of a sale in 2022. If you are already using your channels and outreach to highlight the need to the consumer, there’s a higher chance that dropping your price may pay off this month (and for months to come!)

Choose sustainable and local sources for your ingredients and elements 

With so many brands choosing to go overseas for their ingredient and raw material sourcing, you could set yourself apart and choose local sources instead, wherever possible. There are plenty of benefits to making this pivot, including: 

• Increased brand awareness 
• Less fuel emissions from total transport distance 
• Sustainable support for local farmers 
• Enhanced brand perception 
• Potential discounts on bulk purchases
• Newfound vendor relationships and secondary sourcing support 

Build a social media presence 

Digital marketing is more important now than ever–especially for food and beverage manufacturing businesses. With the rise of TikTok and the domination of video content, users can now truly “experience” a food, especially if it's a novelty item. Investing in a social media specialist or agency would be a great pivot ot make if you have the budget and infrastructure in place to do so and can get your name on the “map” of the social foodie community – a group that is comprised of millions. 

Centralize and strategize your operations with Inecta 

Looking to centralize your operations into a sleek, cloud-backed interface that’s tailored to the needs of your food and beverage business? Connect with the team at Inecta today for more information. We’ve been leading the industry for over twenty years, creating high-quality food ERP solutions that empower you to take advantage of end-to-end management for your business. 

For more information and to get started today, please visit our website. We look forward to assisting you!