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What are order cycles and how do I use them correctly?
What are order cycles and how do I use them correctly?
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Written by Luisa
Updated over a week ago

In some industries, especially the fashion industry, wholesale order cycles play an important role, as they provide planning security for both brands and stores. The following article explains what order cycles are, in which areas they are important and how to apply them correctly.

What are order cycles?

Order cycles describe the cycles in which stores pre-order their products for a season and when it is subsequently displayed in the store.

In a classic order cycle, orders are usually placed a year in advance, e.g. in spring 2020, purchases are often already made for spring 2021. Parallel to the summer sale, the pre-order for the next year's summer collection often happens at the same time.

Fall/winter orders are often made in December of the current year, with delivery starting in June. This means that summer goods are delivered in winter, winter goods in summer, and all this on the basis of the "first in, first out" principle. The procedure describes the assumption that whoever delivers first is sold out first and receives the first follow-up orders from retailers.

How do I apply order cycles?

In the fashion industry, there are two seasons for selecting products and ordering them from retailers: Spring/Summer and Fall/Winter. In planning for the spring/summer season, samples are ordered as early as August/September and evaluated as to whether or not they should be displayed in the store. For the fall/winter season, this usually happens at the beginning of the year in January and February.

After that, an order is created. It often takes up to three months until the ordered goods are delivered. After the goods arrive, the website of the shop is updated with the appropriate products, and advertising is placed from the shop owner.

In March/April the exhibition of the products for the spring collection begins and in May the summer collection follows. Similarly, the exhibition of the autumn/winter collection begins around September.

The interior sector is not quite as divided into order cycles as the fashion industry is. Particularly for more seasonal products, such as scented candles or wool blankets (for indoor use), a certain lead time in sales should nevertheless be taken into account.

Also, order cycles might be relevant if the product portfolio is changed based on the season. Here, the order cycles of the fashion industry can be used as a guide. The situation is similar with seasonal foods (e.g. sets for making ice cream or gingerbread) or seasonal cosmetics (e.g. sunscreen for the body).

In addition, the most important order phase for all brands in the gift sector (and everything that can be marketed as a gift) is the Christmas order phase. In traditional wholesale, the Christmas season usually begins in August/September and ends in late October. Certain holidays (e.g. Easter, Mother's Day, Valentine's Day) should also be considered in the annual planning with some advance notice.

In general, brands that are exposed to order cycles should align with them in their marketing activities to the best of their ability. This means that B2B ads should be placed with a time lag and the current order season must already be considered. For example, the advertising of Christmas products should start in August and thus in the summer in order to plan enough lead time.

Do small stores order differently than large chains?

Small, owner-operated stores often base their ordering behavior on the general ordering cycles of the industries. Overall, however, they have the luxury of being able to order more flexibly than large chains. This means that small stores may spontaneously order summer fashion even in early summer. This happens in particular when the store is completely convinced by the products and sees in the brand an optimal addition to the current assortment.

It is therefore always worthwhile to spontaneously advertise for the current season if remaining stocks are available. In the communication, however, it should then be clearly stated that the products can be delivered to the store quickly.

What does the future of the order cycle look like?

Since the pandemic has canceled the industry trade fairs, where most orders are normally placed, the order cycles are in a state of upheaval. This means that spontaneous store openings can lead to orders being placed at short notice. At the same time, there is a risk that leftover products from the previous season may still be lying unsold in the stores' warehouses. The digitization of cycles is currently being accelerated and is more important than ever, and many also emphasize the importance of shortening order cycles.

As a brand, it is worthwhile to act as flexibly as possible and to keep a strategic eye on current market developments.

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