“Oh, Chinese New Year is already here? That caught me off guard,” said, almost all production managers.
Over the years, one thing I’ve observed from my colleagues is how Chinese New Year (CNY) always seems to catch people off guard.
I’m not exactly sure why this is. This holiday and issue comes every year. But, my general assumption, it’s a lack of understanding on how to be prepared way in advance for CNY.
There are some major benefits to preparing now for CNY (detailed at the bottom of this article).
So, that’s why I took the time to lay out exactly how to start approaching Chinese New Year in September.
But first, let’s talk about…
Some facts about Chinese New Year
Here are some useful facts about the Chinese New Year holiday that will help you to plan for the best results. Preventing you from getting caught off guard by unexpected scheduling.
Ramping up to Chinese New Year factories have many rush orders
Believe it or not, you aren’t your suppliers only client. And the reality is most of their other clients aren’t going to read this post and be prepared for CNY. Inevitably, December will roll around and just when they thought they got ahead of the Christmas production rush they get hit with the news from their factory that the last day for placing an order before CNY is next week.
This means all the other clients for the factory are going to be submitting orders and trying to get completed before everyone leaves for the holiday. Most factories will be at full capacity mid-December, through January, and until they close for the holiday.
Workers are off for nearly a month
Chinese New Year for 2018 is officially February 16-18. However, those dates serve no other purpose than to be a guidepost for one of the longest Holidays in the world.
In the week leading up to CNY things will start to slow down. Some workers will go back to their hometowns early. Generally things start to slow down.
Two days before CNY everything shuts down.
Then for the next three to four weeks everyone is gone. Most factory reps won’t respond (the diligent ones will).
But no production is happening for nearly a full month.
Some workers never return
When the workers do come back it’s typically at a fraction of the work force because a portion of the workers quit. This can be for a number of reasons ranging from not wanting to leave their hometown to finding a higher paying job at another factory.
The important thing to know is once your factory gets back to work they will also be looking for new workers to fill the gaps. Which leads to the next helpful fact about CNY.
Production slows down for a few months
After CNY production will inevitably slow down. The work force is smaller, training new workers, re-establishing communication with partner factories, and organizing all of the new orders will all contribute to slower than usual pace.
There are many backed up orders waiting to be fulfilled for people who forgot to prepare
For those that didn’t prepare for CNY. For those that didn’t read this article. They’ll be rushing to submit their orders the moment their factory gets back. Which will clog up capacity. Expect this to last at least 2-3 months after CNY.
What you can do now to prepare
Now that you know the facts behind CNY. Let’s talk about how you can start preparing now and never be caught off guard!
Plan your inventory now
Observe your Inventory flow at mid-year to plan for having enough inventory to last through the craziness of CNY. If you’re not already, we recommend you use an inventory management software to have complete insight into your inventory needs (and projected needs will be).
This means placing larger orders towards the end of the year, or beginning of the year, depending on your factories CNY schedule. Which leads to….
Communicate clearly with your supplier about their CNY schedule
Ask them a few key questions.
- When is the last day to submit an order before CNY?
- What is the last working day for the factory before CNY?
- What day will the factory be back to work after CNY (meaning starting production, note that sometimes they will give you an earlier date which is the day the office staff comes back – but does not necessarily mean that’s the day the workers will be starting production)?
- When will their suppliers or subcontractors be back to production status. Master cartons, ticketing, giftboxes, the plating or dyeing subcontractors may not return to full production status until weeks after your factory is back online.
Understand your suppliers workload with other clients
It’s important to know where you fit into the factories overall production schedule.
How many orders are currently being placed before you?
How many other clients will be placing orders before CNY?
In general how many clients is the factory working with? (This will help to understand the scale of potential slow downs after CNY.)
Know the last day for shipments
You never want to be in a situation where your product is packed and waiting to be shipped but it was the last working day and now everyone has gone home.
Be sure to understand when is the last day the factory can ship out your orders.
Also, be aware of the various shipping companies schedules around CNY. Are they picking up and delivering as normal? Likely not.
The results of prepping now
What does all of this preparation get you? What are the benefits to you and your business?
In stock on most important products
If you prepare now, you won’t be in a position where you can’t meet the demand at the beginning three months of 2018.
Set yourself up for new product introduction
You will have the freedom to develop a clear roadmap for new product introduction without worrying about catching up on tightened inventory.
Thorough quality checks without rushed production
We’ve seen it time and time again, when production is rushed the quality standard is lowered. The buyers realize there is not enough time to do the inspection to the level of rigor that it needs and just overlooks a few key parts.
Sometimes quality inspections are skipped all together.
If you prepare now you’ll have plenty of time to do a quality inspection at the level your product needs.
You can learn more about how Insight Quality can help you plan for your CNY quality inspection needs by contacting us here.
Because you’ve planned in advance you won’t have a rushed order which means no rushed production up-charges.
It’s simple, if you plan ahead, while everyone else is running around like a chicken with their head cut off you’re calm and collected because your warehouse is already filled with all the inventory you need for the next couple of months.
Because you planned for Chinese New Year in September.
Share with a colleague or friend that should also be thinking about preparing for CNY as early as possible.