Supply chain planning: Keeping promises, no matter what
Supply chain planning is hard even during the best of times. How can wholesale distributors make good on their promises during a crisis?
The Brazilian “Carnival in Rio” is one of the most important holidays in Brazil, where celebrations run long into the night for four days straight – from Friday to the following Tuesday before Ash Wednesday.
In some regions – for example, in the northeast of the country – the holiday can last between six and ten days, depending on the city. During this time, many companies and businesses completely stop their activities and suppliers take a break.
Brazilian Carnival’s impact on the supply chain
The carnival in Salvador is one of the biggest in Brazil, along with the one in Rio. And every year, over two million visitors come to the city to celebrate in the streets. As a result, many roads are closed, which has a significant impact on the logistics sector.
Apart from the road closures, there’s also heavier traffic, causing congestion on the roads, as many Brazilians use this time to travel. And the tense traffic situation during the Carnival days often leads to delivery delays.
In addition, the increased demand for certain products and services such as beverages, consumer goods or food during carnival days poses a real challenge for many companies, as they may not be able to deliver them on time if there are logistical problems.
Companies should plan ahead to avoid problems or bottlenecks in the supply of basic or necessary goods.
Since Carnival is celebrated all over the country, you might see someone dressed as a dinosaur or a duck at work here and there. And making phone calls might be difficult as the person you are talking to might be hoarse and barely able to speak, or the background music might be so loud that you can’t hear.
Moreover, many businesses cease operations completely during this time. The timing of Carnival celebrations varies from city to city in Brazil, which makes planning and synchronization more challenging.
Fortifying the retail supply chain for an omnichannel future
Faced with ongoing uncertainty, retailers are strengthening their supply chain to keep shelves stocked, inventories healthy, and customers satisfied.
4 ways businesses can survive Carnival
Brazil is known not only for soccer and carnival, but also as a major exporter of soybeans, iron ore, petroleum, meat, cane sugar, and coffee.
As many factories and companies close during Carnival, it can cause delays or shortages in the production and distribution of goods, which in turn impacts the supply chain of certain industries such as agriculture or manufacturing.
Here are 4 ways businesses can avoid disruption during the Brazilian Carnival celebrations:
1. Plan ahead
Plan not only for the days during the carnival festival, but also for the post-carnival days, as the impact may last for several days or weeks. Based on structured data (orders) from the past as well as unstructured data such as current sentiment analysis, weather patterns, covid spikes and other events, a meaningful picture of supply and demand can be created to guide inventory build.
2. Check employee availability
Many workers take leave during the carnival season, which results in understaffing and can create significant problems for companies that rely on a permanent workforce, such as those in logistics or shipping. Modern technologies, such as advanced warehouse management, can help control both simple and highly complex automated warehouses. This would also make it possible, for example, for contract workers to step in when there’s a need.
3. Review alternative transportation options
The traffic disruptions that come with Carnival can result in goods such as fresh produce or certain pharmaceuticals that rely on timely delivery not arriving at retail stores or pharmacies on time. To avoid this, consider alternative modes of transportation when road transport is no longer guaranteed.
4. Optimize inventory
Since a larger number of tourists travel to the country, especially during Carnival in Brazil, there can be a short-term change in demand for goods and services during this period, such as increased demand for food and beverages.
Using inventory optimization planning logic, forecast demand can be matched with forecast supply to ensure customer orders are fulfilled, shorten lead times, and minimize inventory shortages and over-ordering.
Knowing what to expect during the Brazilian carnival festival other than the guaranteed hot samba rhythm is half the battle. Being well prepared is the best way to avoid any negative impact on the supply chain.
