Chinese New Year 2016

February 7th – February 15th

Mon 01st, Feb

Chinese New Year poses one of the biggest annual challenges you'll face when working in the logistics sector.

China is essentially closed for business over this holiday period, meaning that planning ahead for stock surpluses and post-holiday lag as workers drip back to work is absolutely vital.

Great communication and forward planning can save you from possible complications during this time. Collaborating closely with clients and planning intimately with suppliers, carriers, airlines and sub-contractors will eliminate Supply Chain interruption.

Supply Chain Managers in 2016 need to plan for no production or shipments leaving China from late January and for reduced output during the first half of March 2016.

It is therefore prudent to analyse the key ingredients required for businesses wishing to maintain Supply Chain integrity during Chinese New Year.

Forecasting

Forecasting can be quite complex as it is dependent upon supplier numbers, geographical location and SKU data.

Factories will enter overdrive mode prior to Chinese New Year to meet delivery obligations prior to closing. Supply Chain Managers must be very specific on:

  • Production deadlines
  • Latest ship dates

Service providers likewise must communicate their client forecasts to carriers so as to avoid booking refusals and container availability bottlenecks. It is critical to liaise with suppliers to confirm exact numbers on an on-going basis at least two weeks prior to vessel departure. 

Increase Inventory

As a rule of thumb, receipts scheduled for March require 50% of that volume "shifting" to arrive in January and the remaining 50% for February's intake.

The net effect on stock migration sees January and February taking an additional 50% increase to counteract a significant drawdown reduction in March.

Warehouse Planning

Warehouse capacity and manpower planning for this seasonal fluctuation is essential.

Creating additional space where spare capacity is at a premium can be managed effectively by having a laser focus approach to creating more room by executing good housekeeping rules.

Manpower planning remains a conundrum between goods in, housekeeping, picking and loading. Tailoring receipts and dispatch activity, invariably by tweaking resource allocation, minimises any short-term disruption.

Changing Sourcing Strategy

Dual sourcing is a common solution. In other words instead of buying additional inventory look to other possible suppliers from different geographical locations, that aren't affected by the Chinese New Year closures, to bridge the gap to maintain a consistent and manageable product flow. 

Supply Chain Savvy

Incentivising slow moving stock and offering promotions can clearly help both revenue streams and warehouse space.

In summary the more time you take to understand the complexity of Chinese New Year, the better equipped you will be to mitigate its effect on your company's operations. 

Leave a comment

Happy 9th Birthday 6th Door Ltd

Tue 19th, May

As I’m leaning on the stand-up desk in my makeshift home office, that over the weeks has been turned into a video and podcast recording studio

How to take back control of your water costs

Fri 13th, Mar

While most businesses already have a comprehensive strategy in place for their electricity and gas consumption, water management is often overlooked.

How to choose an energy consultancy

Fri 13th, Mar

Most business owners recognise the advantages of shopping around for the best energy deal, but without the time, resource and expertise to find the best tariff, it can be an almost impossible task.

Business energy: Don’t get caught out by rollover rates

Fri 13th, Mar

As a busy business owner, you may feel there are not enough hours in the day to secure your next energy contract. You know you’ll get around to it, but when you’ll get around to it is another matter.

Business water matters – Top 3 water saving tips

Fri 13th, Mar

Water is often referred to as ‘the forgotten utility’. While many large businesses are clearly focussed on their comprehensive energy strategies, it seems many are yet to implement a strategy around managing their water usage.

Know where your cloud data is stored or risk a GDPR fine

Thu 27th, Feb

For businesses who have chosen cloud-based data hosting services there’s a temptation to relax and think “great, we’re paying someone else to take care of our data, we don’t need to worry about it any more.”

Transparency plans could slow down region’s business growth

Thu 27th, Feb

Efforts by regional start-up initiatives that have led to Merseyside outperforming the rest of the UK when it comes to business growth could be hampered by new government proposals, a leading legal expert has claimed.

Backup or risk losing your business

Thu 13th, Feb

Maintaining a robust backup is hard work, it’s important to not only build the correct solution for your business and trust your IT support provider to look after it, but to also maintain a sense of urgency as a business owner to...

Information Destruction and Compliant Data Handling in the Education Sector

Thu 13th, Feb

Identity theft costs the UK economy £5.4 billion and a recent BSIA report showed 169,592 cases of identity fraud, representing an increase of 49% over the previous year.

Give Your Business Utilities a Refresh for 2020

Mon 20th, Jan

January is a time for reflection for most people and this includes business owners, with the new year bringing with it an opportunity to take stock of performance during the past 12 months, create goals for the year ahead, and ensure...