The Business Plan with Bill Reagan: Another holiday season with twists

The Business Plan with Bill Reagan: Another holiday season with twists
Bill Reagan (Alexandria Small Business Development Center)

Last year’s column – “Holidays with a twist” – noted that the 2020 holiday season was challenged by pandemic restrictions, but it highlighted ways we could still make the most of Alexandria’s postcard-perfect setting while taking necessary precautions.

Well, here we are a year later, and the new coronavirus still lurks, so we must continue to factor Centers for Disease Control and Prevention protocols into our planning – at least until there’s sufficient immunity so viruses and variants can’t get a foothold. While this is wearing our patience, it’s a worldwide reality and our community is far ahead of most in making the best of it.

This season is also complicated with supply chain challenges. You’ve seen the news and perhaps personally noticed a vacant shelf. What’s going on and why do experts predict it will continue through mid-2022?

The positive aspect is that we’re all coming out of pandemic isolation ready to indulge ourselves or resume activities. Demand is way up, and that’s a good economic trend. It becomes stressful, however, when the supply side can’t keep up. It’s further exacerbated when that demand/supply imbalance happens during the year’s peak retail season.

The global supply chain has multiple components: manufacturers that provide finished products or components, shippers, ports, warehouses and transportation companies. Disruption occurs when any one of these becomes a chokepoint, but is nearly impossible to resolve when all the components are hindered by multiple factors.

First, the pandemic forced worldwide operations shutdowns and closures. Just as those were reawakening, much of the world experienced 100-year storms, weather disruptions and power outages that further set things back. International interdependence, just-in-time inventory strategies, increased e-commerce, labor shortages and a Delta variant breakout further confounded things.

Just as with the pandemic, this is a global circumstance. Everybody is feeling supply chain pain and everyone’s struggles have ripple effects.

There are mitigation strategies, and these apply to both consumers and business owners. There are no quick solutions, but the better informed we all are, the more effective the workarounds. The first step is forecasting and planning ahead by continually researching what will be in short supply. Businesses should consult their trade groups or peers. It might mean stocking up on items early, while they’re available and before prices increase. It might necessitate alternative sources of supply or entirely different substitutes.

Transparency is the most effective hedge. This means everybody up and down the chain keeping one another informed so each can plan accordingly. Don’t yell at suppliers – work with them to know what and when to order. Merchants and consumers communicating and supporting one another bodes well for long-term, fruitful relationships.

Small Business Development Centers in Virginia are promoting “Shop Sooner,” a campaign to encourage buying now for all the upcoming holidays. More than ever, it’s a time to shop local, shop small and shop early.

Given Alexandria’s celebrated holiday setting and the characteristic resilience of our community, we’re fully capable of overcoming the challenges before us and making the most of the season ahead.

Happiest of holidays!

The writer is executive director of the Alexandria Small Business Development Center.