One of the first shocks we received this year came from China and while the global pandemic was an unplanned blow to businesses around the world, we are sorry to shock you but China is not quite done with shaking the economy of global businesses. One thing anyone involved in commerce and industry must know is that any glitch from an industrial powerhouse like China can have ripple effects.
There are a few national holidays in China and the most popular and arguably most important are the Chinese New Year or Spring Festival and the Chinese National Day Celebrations. These two holidays are notable for being long and this year’s Chinese National Day coincides with the Mid-Autumn Festival. The Chinese New Year this year ran from late January till early February and the National Day which commemorates the founding of the People’s Republic of China will run from the 1st of October to 8th 2020.
This obviously means that for 8 days all business operations will be closed within China and traditionally this would have already started a few days before and is likely to continue for a few days after, news and images from rail stations across China show a large number of citizens planning and traveling for the holiday. If you are specifically in the export/import sector or directly affected this could have major hiccups for business. But don’t worry, we have compiled a few tips for you to navigate the business terrain in this hurdle.
What Can You Do Concerning The Chinese Holidays?
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Try To Understand The Situation
The first thing is for you as a stakeholder to understand the extent of this condition on the global market and its effects on your business. One outstanding factor in the Chinese holidays is that as businesses are shut workers are traveling and many return later than the duration of the holiday while some may not return at all.
The BBC states that an estimate of over 550 million people would be traveling during this year’s Chinese National Day. And while all this goes on many factories may have likely shut down days before the beginning of the holiday some as many as 10 days before. This means that certain shipments or supplies may be delayed.
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Plan Your Shipping Arrangements
If you missed the first window for planning your shipping plans it is likely that your goods are already on cue and if not, then this period might be an opportunity to assess your plans and adjust to the necessity.
One thing we would recommend is taking an inventory of your products and also scheduling your plans for other needed shipments. We also recommend a top to bottom list starting with some of the most important of urgent then downwards. It is very probable that the earlier arrangements made will be the first to be attended to when businesses reopen in China. You can take out time to review and check for businesses that may reopen quicker and if they would be willing to start operations earlier.
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Create A Solid Relationship With Your Supplier or Manufacturer.
If you did not have a strong relationship with your go-to person in China this would be a good time to develop one. As businesses are overwhelmed with scores of requests and jobs kicking off slowly, strong personal ties with your manufacturer will go a long way in ensuring that your orders are a priority. He or she can also help you determine the dates for ship off.
Another important factor to note is that such relationships will also help in assuring your quality. Because of the holiday rush before and the slow pace after the resumption, certain enterprises can be notorious for dumbing quality as workers rush through the horde of orders or become slow towards work.
It goes without saying that this is where trust and a good relationship with suppliers can stand in the gap as an assurance.
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Consider Other Options
If there has ever been a time to have a plan B then it is surely now. As business operations in China shutdown, this could be an opportunity to scout for an alternative, while China is strategic to businesses operations you might want to reconsider putting all your eggs in a basket and source for some other countries that may be available for operations if only momentarily.
One way to go about this would be to check for a manufacturer with operations in various countries. Some companies try to reduce the pressure on their Chinese factories and diversify, you can check if your manufacturer has a backup supplier for emergencies like this. Another interesting fact is that some major operations happen outside China in countries like Vietnam.
Whatever the case is, it is always good to factor inconveniences like this and source for other options.
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Plan for A Delay Scenario
If you already ordered before the holiday or are just making shipping plans you are most likely in for it. In situations like this, it is important to just hope for the best and expect the worst. As we mentioned earlier, if some workers in your manufacturer’s company do not return then there are going to be further delays as it may take some companies weeks if not months to adjust operations and hire new workers.
Even as workers resume which may be days after the holiday it takes more time to fully adjust and meet demands.
One of the things you can do is to leverage on forecasts like Vendor Managed Inventory (VMI). The VMI business model is meant to ensure that vendors and buyers agree to certain levels of inventory for products, the vendor will develop a schedule with your sales history and inventory to make arrangements for adjustments in seasonal demands like this. VMI can be helpful if situations like Chinese holidays have a huge capacity to disrupt your supply chain or plans.
You may also have to just make do with your current inventory and be ready to make adjustments.
In handling the Chinese holidays and cushioning their impact on your business, it would all still trickle down to careful planning and being fluid enough to make necessary adjustments. We wish you luck and hope that these tips were helpful to your plans.
