The holy month of Ramadan, like any other seasonal activity, creates a surge in demand for various consumer products. Overseeing logistics during Ramadan can be a massive challenge, especially in high-demand industries like e-commerce. Supply chains across the world scramble to keep up with this spike, particularly those tied to Muslim-majority countries. The pressure is most felt by logistics managers.
If you’re a logistics service provider, an in-house manager, or someone curious about how companies handle logistics for e-commerce during Ramadan, this guide is for you. We’ll paint a clear picture of how Ramadan affects consumer shopping, its implications, and some best practices for our friends in logistics.
The festivities and the spirit of the holy month bring everyone closer. On average, people socialize more, joining friends and families to break their fast at dusk (known as iftar). Observing intermittent fasting increases the demand for certain consumer products. The million-dollar question is: How do these social and cultural factors affect consumers? The answer is simple: They start buying more.
Most consumers prefer to buy in bulk and stock up their pantries in advance, either once at the beginning or at regular intervals throughout the month. The majority of consumers begin their Ramadan shopping in advance. According to Facebook IQ, 34% of Ramadan shoppers globally plan their purchases 1-2 weeks before the start of Ramadan, 10% plan more than three months in advance, and 17% don’t plan ahead.
Data from Google tells a similar story. For instance, “online grocery shopping” peaks a few weeks before Ramadan. In the UAE, 36% of Ramadan shoppers plan their purchases 1-2 weeks prior to Ramadan, and about 41% of shoppers report that they spend more than usual during Ramadan.
Considering historical data and its implications, as a manager, you need a sound game plan for executing smooth logistics in Ramadan. Implementing certain best practices at the right time is crucial.
First, calculate the demand for your best-selling products or raw materials as accurately as possible. This will help you estimate requirements for inventory, labor, and shipments. Use data from previous years and factor in external variables that might affect demand, such as changes in preferences and prices. Maintain close collaboration with the marketing team and stay on top of various economic, behavioral, political, and industrial trends.
Depending on your current labor resources, warehousing capacity, and projected demands, you can choose one of two strategies for planning your inventory for Ramadan:
Factor in shipment delays when planning. Even slight delays during a peak season like Ramadan can be catastrophic for sales and revenue. Maintain close communication with partners, track orders and shipments in real-time, leverage data for insights, and use predictive analytics to handle sudden demand surges.
Despite your best efforts, stock-outs can happen. Maintain close communication with all concerned departments and partners about demand forecasts, purchasing, labor, warehousing requirements, and potential shipment delays. This minimizes the risk of stock-outs and allows you to communicate potential shortages with your customers, retain them, and come up with solutions in advance.
If there’s any time to test your logistics management process, it’s the month of Ramadan. The secret to capitalizing on all the positioning and conversion opportunities it offers is a proactive approach, ample planning for the peak, and close communication throughout the month. Regardless of your strategy, it’s always better to kick-start your shipments at least two weeks prior to Ramadan.
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