Halloween has become big business and, in recent years, has also marked the beginning of the holiday shopping season (a place once reserved for Thanksgiving). Every year for over a decade, the National Retail Federation (NRF) has conducted a Halloween survey “to see how Americans will celebrate the fright and delight of this beloved autumn holiday.” What this year’s survey found was, “Americans are looking forward to splurging on their favorite candy and costumes this Halloween season.”[1] How much are Americans planning on spending this Halloween? According to the NRF, the total could reach an all-time high of $8.4 billion. The biggest outlay from consumers (67%), according to the survey, will be for candy ($2.5 billion) and costumes ($3.1 billion).[2] The rest of the money is spent on decorations, haunted mansions, parties, and so forth.
What’s your little goblin likely to be wearing this holiday? Matthew Townsend (@matt_townsend) reports, “Superhero costumes will unseat princess outfits this Halloween.”[3] That conclusion also came from the NRF annual survey. Townsend adds, “For the first time in more than a decade, more U.S. kids will dress up as action heroes than princesses.” Although on the surface this development might look bad for Disney, one must remember that Disney now owns Marvel and Star Wars characters. May the Force be with you. The impact of comic book-based and science fiction movies is also seen further down the costume list — with characters from Batman (#4) and Star Wars (#5) figuring prominently.
Analysts from Millennial Minds remind us that Halloween costumes, candy, and decorations don’t just magically appear on store shelves. Months of planning and hard work are involved. “Each year,” they write, “supply chain professionals work to bring candy, costumes, pumpkins, and more to consumers to celebrate Halloween. This may seem like a minor holiday in comparison with Independence Day or Thanksgiving, but Halloween means big business for many in the industry.”[4] Alexa Cheater (@Alexa_Cheater), Marketing Content Manager at Kinaxis, adds, “Halloween is big business for candy companies, costume suppliers, and pumpkin farmers alike.”[5] Cheater knows supply chain professionals work hard to avoid Halloween horror stories. She explains, “The intricate planning to make sure you have just enough of the right stock, complicated logistics of getting all those goods from point A to point B, and added demands of making sure you have the workforce to produce, sell and ship these seasonal items is enough to send anyone involved in the Halloween supply chain running in terror.”
Karsten Horn (@karsten_horn), head of the inventory and supply chain division at INFORM, reports, “The tradition of trick or treating can be traced back to the Middle Ages, when poor people would go door to door on November 1st and sing prayers for the dead in exchange for food. Today, children visit neighbors in costume to ask for treats. Three-quarters of US households handed out treats for Halloween last year, and the most popular treat is chocolate. Those who don’t want to take part, or who hand out disappointing treats like apples or carrots, might face the threatened trick, which is typically a prank played on them or their property.”[6] Horn notes that the real nightmare for many retailers is inventory. You must have enough stock on hand to satisfy customer demands; but, he notes, on 1 November, “nobody is interested in spookily themed chocolates, costumes or decorations any more.” Holidays are like that — they are good for business until the holiday is over and then themed merchandise becomes a burden. Horn elaborates:
“Meeting the huge spike in demand requires a coordinated effort from the board of directors, purchasing managers, production managers, and the marketing and sales teams. To ensure that they are using the same information as the basis for decision-making, there must be one valid plan for demand forecasting that they all respect. This avoids breaks in the chain, or the cost of storing excess goods when there are more materials or stock than needed.”
Donning my fortune teller costume and looking into my crystal ball, I predict that cognitive computing will play a significant future role in ensuring that manufacturers and retailers do a better job of demand planning for the holidays. Cognitive computing systems can deal with myriad variables looking for causal relationships, trends, and other significant insights. They can also gather and integrate both structured and unstructured data ensuring all corporate stakeholders are “using the same information as the basis for decision-making.” This becomes increasingly important as demarcation lines between holidays begin to blur. “The holiday consumer buying season is starting earlier every year,” writes Hailey Lynne McKeefry (@HaileyMcK). “Once a Thanksgiving and Black Friday phenomena, now pundits are tracking sales of holiday buying as early Halloween.”[7]
By now (Halloween Day), most candy and costumes have been bought, homes decorated, and pumpkins carved. All that’s left to is greet ghoulish visitors at the door, dole out candy, and hope to avoid any nasty tricks. If you are out and about this evening, please be safe. Watch for costumed children whose enthusiasm to get to the next house might temporarily diminish their judgment about running out into the street. And if you attend a party at which drinks are served, don’t let the celebrations diminish your judgment about drinking and driving. From all of us at Enterra Solutions®, have a happy and safe holiday.
Footnotes
[1] Ana Serafin Smith, “Halloween Spending to Reach $8.4 Billion, Highest in Survey History,” National Retail Foundation, 22 September 2016.
[2] “2016: Halloween Spending to Reach $8.4 Billion,” National Retail Federation, September 2016.
[3] Matthew Townsend, “Superheroes Top Princesses in Halloween-Costume Battle,” Bloomberg, 26 September 2016.
[4] Millennial Minds, “Scary Supply Chain: The Logistics of Halloween,” LoadDelivered, 22 October 2013.
[5] Alexa Cheater, “Halloween Supply Chain Ghost Stories,” 21st Century Supply Chain Blog, 30 October 2015.
[6] Karsten Horn, “Trick or treat in the supply chain,” Inventory & Supply Chain Optimization, 27 October 2014.
[7] Hailey Lynne McKeefry, “A Look at the Spooktacular Halloween Supply Chain,” EBN, 30 October 2015.
