How S&OP Performed for the B2C Supply Chain During the Holiday Selling Season

In November, Bob Ferrari was skeptical of companies' fulfillment capabilities for the 2012 holiday season. This vice president and managing director for The Ferrari Consulting and Research Group LLC in Boston, expressed his concerns in this blog post, High Stress Period for S&OP and Supply Chain Planning Teams in B2C Supply Chains, where he explained why sales and operations planning (S&OP) and supply chain planning teams within B2C and retail-focused supply chains were expected to be "especially challenged" during the 2012 holiday buying season.

"The period from the Thanksgiving Holiday in the U.S. through the holidays that extend into January of 2013 are a period of seasonal surge, where profitability for the entire year may be at stake," Ferrari wrote, pointing to the statistics from marketing analytics firm comScore, Inc., as one of his primary reasons for concern. At the time, U.S. retail e-commerce spending was up nearly 16 percent for the first 26 days of November and Cyber Monday online sales were estimated to be nearly $1.5 billion - up 16 percent from a year earlier.

Fast forward to January 2013 and Ferrari says that while retailers have yet to disclose sales for the fourth quarter of 2012, their S&OP functions were certainly challenged by the surging buying patterns that characterized last year's holiday season. As expected, he says consumers shopped a lot online, but in the end most didn't spend as much as the research firms initially predicted. Because of this, Ferrari says estimating when and where inventory should be located - and in what quantities - turned into a key obstacle for companies.

"No one wanted to get stuck with inventory," says ...