India is known for its rich culture and festivities, especially beginning in August till the end of the year. Celebrations such as Krishna Janmashtami, Ganesh Chaturthi, Dussehra, Christmas, and the upcoming Diwali will result to businesses getting busier before major holidays. As one of the country’s biggest celebrations, Diwali sees a surge in consumer spending. This spike puts extra pressure on supply chains to keep up with timely deliveries. While businesses gear up for the increased demand, they also face some supply chain challenges along the way.
What is Diwali?
Diwali, also called the Festival of Lights, is a major Hindu celebration that symbolizes the victory of light over darkness and good over evil. It is marked by five days of festivities, including lighting oil lamps, setting off fireworks, decorating homes, and sharing sweets with loved ones. Diwali in India is not just a religious event but also a time for families to come together, exchange gifts, and shop for new clothes and household items. This makes it one of the busiest and most important holidays, with cultural and economic significance across the country.
Impact on Supply Chain
As the community and businesses prepare for Diwali in India, supply chain disruptions are expected due to various factors:
- Labor Shortages: Many workers take time off during Diwali to celebrate with their families, leading to reduced staffing in manufacturing and other sectors. This can delay production and limit capacity.
- Skeletal Workforce in Logistics: Staffing shortages at customs, airports, seaports, and trucking companies can slow down the processing and delivery of goods, affecting logistics operations.
- Congestion and Delays: Increased demand for transportation services before Diwali in India often leads to congestion at ports and terminals, as businesses rush to meet shipment deadlines. The situation is further intensified by reduced staffing levels at port terminals due to the holiday.
- Shipping Schedule Disruptions: With manufacturing slowing down, shipping lines may introduce more blank sailings during Diwali to balance supply and demand, potentially causing delays and interruptions in shipping schedules.
- Higher Freight Costs: The high demand and limited capacity during Diwali drive up freight rates, resulting in increased shipping costs for businesses.
Preparing for Diwali
Here are some strategies to help mitigate the impact of Diwali in India on your supply chain:
- Plan Ahead for Production: Anticipate the increased demand for your products and services during the celebration, and adjust production schedules accordingly. Consider boosting inventory levels or stockpiling goods in advance to avoid potential shortages.
- Diversify Your Supply Chain: Reduce reliance on any single supplier by sourcing from multiple vendors. This approach minimizes the risk of disruptions if one supplier in India faces delays or capacity issues during Diwali.
- Communicate Potential Delays: Inform suppliers and customers about potential delays during the Diwali in India holiday period. Setting realistic expectations helps maintain smooth business operations and avoid unnecessary disruptions.
- Prepare for Logistics Early: Book shipments well in advance to secure space and manage costs. Partnering with a reliable freight forwarder can help you effectively plan logistics and navigate holiday-related challenges.
- Leverage on India Advisory Service: Navigating the Indian supply chain before a long holiday can be challenging, especially with regulatory bodies limiting services. It’s crucial to maintain your production and inventory during this time. A local advisory expert can guide you through the necessary steps and provide effective solutions. Dimerco India offers an Advisory Service that includes warehousing solutions such as free trade warehousing, bonded warehousing, general storage, and other services such as customs brokerage, and transportation management. Check out Dimerco India’s warehousing services.
Need Help to Prepare for the Holidays?
The key to minimizing the impact of Diwali in India on the supply chain is thorough planning and proactive communication. Working with a trusted logistics partner can also help ensure smooth operations during peak season. Dimerco India has the expertise to handle supply chain challenges during busy periods. Reach out today to start a discussion.
