Prepping for Peak in DTC Fulfillment Calls For a Holistic Approach

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Preparing for peak season volumes in DTC fulfillment requires not only cooperation among partners but scheduling stress tests, ensuring sufficient server capacity and nailing down carrier commitments well in advance, attendees were told during a panel discussion at Home Delivery World in Philadelphia.

“The good news is, most systems are built with some resiliency in there for things like Black Friday,” said panelist Joe Gullo, vice president of supply chain and logistics at Thursday Boot Company and a veteran of Glossier and “If you’re paying attention to those things, doing stress tests leading up to the holiday, pushing volume through, you should be all right.”

Still, things happen, Gullo said, relating an anecdote about a leaked 50% off promo code when he was at Glossier, causing a massive order spike that set off alarm bells and caught the company by surprise.

“Luckily it was at night, and only the UK took advantage,” he said. “We sold six months of product in 10 hours. It took a multi-pronged approach with our partners and inventory. In fulfillment as in life, expectation management is the most important thing you can do. Level set with customers about how quickly you can get product out. If you do the math, understand labor management and demand, and communicate to customers, typically you’re okay.”

Gullo said some 3PLs will push back on stress testing, but added it’s important to have them written into the contract.

Reg Adams, president of Techdinamics Integrations, gave the analogy of a Formula 1 engine when noting that no vendor has a one-stop-shop solution to optimize DTC fulfillment.

“Under the hood, there are 12 different technologies helping it run efficiently,” Adams said. “You need the same thing from a fulfillment standpoint. Find tech partners with the vision to understand your market, who you sell to and whether you distribute from one or 12 facilities, and can drop orders to the appropriate center, based on carrier pricing.”

The panelists also talked about the impact generative AI is having on the world of DTC fulfillment, disrupting as in all other spheres. Even the CEO of OpenAI is sounding alarm bells.

“WMS systems are getting smarter with it, and retailers and brands are all starting to develop into that,” said David Yarbrough, an enterprise account executive with Logiwa. “The market itself is changing, getting faster. Think about the leaps we’ve seen. We’re seeing all kinds of conversations about that.”

As have many other observers, Gullo said generative AI could be trained to handle repetitive, lower-level tasks, freeing up analysts and others to concentrate on higher-level, value-added work. “It can read emails and update Google Sheets,” he said. “We’re working on that.”