How successful importers prepare for Chinese New Year

Chinese New Year is a major holiday observed by over a billion people. As such, it has the potential to seriously impact your supply chain operations. While Chinese New Year is in January, successful importers start planning for it as early as May.

Moving goods through the holidays

As an international shipper, it pays to know when big holidays are coming up. Not unlike Golden Week, Chinese New Year is a significant holiday in China. Also known as Lunar New Year or Spring Festival, the holiday often sees Chinese families enjoying travel, food and gifts. The holiday itself lasts approximately 16 days, during which time shops will be closed for at least five days. However, some businesses shut down for several weeks.

If any part of your supply chain involves China, you can anticipate delays and increased shipping rates during that time period. Instead of casting your business adrift in the sea of unpredictability, why not be prepared for Chinese New Year?

What to expect

When it comes to Chinese New Year and the supply chain, you can safely expect the following four things to happen:

• Factories close.
• Transit times slow down.
• Wait times increase.
• Rates go up.

Any one of the above has the potential to seriously put a dent in your supply chain operations if you are not prepared for it; if all happen at once, you might face a big challenge. Advance planning and preparation are the best way to reduce your risk.

Preparation leads to success

Planning ahead and taking a proactive approach is baked into everything we do here at Cole International and we encourage you to take a similar approach. By preparing well in advance of Chinese New Year, you ensure you will not be caught off guard and potentially avoid any disruptions to production or delivery during that time.

Here are our top tips for planning effectively:

• Speak with manufacturers in advance of Chinese New Year.
• Ask about their required lead and cut-off times for placing orders before the holiday.
• Inquire as to their availability and holiday closures during that time.

• Complete all documentation ahead of time.
  • Things like invoices, packing lists, certificates of origin, export declarations can all be prepared in advance.
  • Avoid waiting to the last minute! Doing so could put your company at risk of costly delays.

• Do not make any deposit payments prior to the Chinese New Year. 
• Recognize that each year some companies that shut down for the holiday are actually shutting down the entire business—for good! Thus, making an advance deposit payment to a company at this time of year is risky.  
  
  
• Avoid placing large orders just before Chinese New Year
• Increase your inventory slightly throughout the year (if possible).
• Consider using alternate suppliers located outside of China.

• Check out our infographic to learn more.

A proactive approach

Major national holidays like Chinese New Year can throw a heavy wrench into your supply chain processes if you are unprepared. Taking a proactive approach and planning ahead is one path to success. At Cole, not only do we help you prepare for what's coming, we adapt to how your company works. If you make a change in your supply chain operations, we support you by providing the best viable guidance and solutions for that change. Connect with us today.

Being prepared. It's what we do.