Key Findings from Manhattan’s 2024 Supply Chain Confidence Survey
Like a tinsel-covered beacon on the horizon, the holiday season is once again approaching. In order to assess the preparedness of retail industry, Manhattan took the pulse of industry leaders, supply chain experts and consumers in its 2024 Supply Chain Confidence Survey. The findings revealed the key trends and challenges driving decision-making during this peak season. They also offer some of the latest technologies and strategies retailers are deploying as they gear up for what is the busiest time of year for many businesses.
Here are some of the report’s top findings:
Inventory is King
Despite preparation and forecasting, inventory remains a significant area of concern for both retailers and supply chain leaders. 87.2% of retailers have measures in place to ensure trending products are available during peak shopping periods, but 38.8% still cite having enough inventory as their biggest concern. A majority (82.4%) of retail leaders have plans to manage last-minute order surges during the holiday season.
Leveraging Technology to Do More with Less
Amid a soft labor market, supply chain leaders and retailers are investing more in technology and automation to navigate peak season demands. 43.6% of retailers plan to make fewer seasonal hires this year. To make up the reduction in human labor, 34.8% of retailers are utilizing automation, while 52.4% of supply chain leaders are investing in improving logistics software.
By contrast, 58.4% of supply chain leaders plan to increase their workforce to manage peak demand, despite labor constraints. Additionally, 61.2% of retail leaders reported recent investments in new technologies to improve the efficiency of their supply chain.
AI on the Rise
Retailers are also leveraging the latest AI technologies to solve many of the problems listed above. 80.4% of retail and supply chain leaders will leverage AI tools to improve inventory management, demand forecasting and customer service this holiday season. 60.8% of retail leaders say Generative AI will play a role in their holiday supply chain strategy, with nearly half (49.2%) planning to utilize AI for inventory management.
In addition, AI is playing an important role in customer service, with 47.6% of retail and supply chain leaders using AI tools to improve customer interactions and handle inquiries.
The High Price of Holiday Cheer
70.4% of retail leaders anticipate that holiday costs in 2024 will be higher than in previous years, driven by inflation and rising shipping costs.
Shoppers are also adapting to inflation by starting their shopping early to take advantage of sales, with 39.6% saying they will begin shopping before previous years to spread out expenses. They are also adjusting their holiday spending: 60% plan to buy fewer gifts, while 57% will seek less expensive options, and 52.2% will look (and are willing to wait) for sales and deals.
Constantly Changing Consumer Expectations
Free shipping remains a top priority for 65% of consumers. Even more revealing is that customers now value precise tracking and accurate delivery times over simply getting their orders as fast as possible.
So, what does it all mean?
While this holiday season is very different from past years, retailers and supply chain experts seem confident in their ability to deliver despite external factors. In our opinion, it is more important than ever for retailers to lean on the latest technologies to address the growing challenges and complexities in retail.
Similarly, it seems certain that consumer expectations will continue to evolve and there will always be external factors disrupting the world of supply chain commerce. Here again, agile technology that can automatically scale to meet demand and seamlessly introduce new capabilities is critical.
The peak holiday shopping season puts unique pressure on organizations but it’s also an unmatched opportunity to deliver great experiences, build loyalty and drive revenues. We hope this busiest time of year is a rousing success for all. Let us be one of the first to wish you a very happy (and successful) holidays!