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4 Strategies for Handling a Sales Surge When demand suddenly spikes, it's do or die time.

By Paula Andruss

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Photo © Leah Fasten
Hau Lee of the Stanford Graduate School of Business.

It's the breakthrough moment! Your product gets a notable press mention or goes viral online, and the orders start pouring in. Rejoice briefly, but then take stock. How you manage your surge when it arrives can make or break your business. Supply-chain management expert Hau Lee, professor of operations, information and technology at the Stanford Graduate School of Business, offers tips on how to act fast and smart to take advantage of sudden demand.

How can startups prepare for sudden growth at the outset?
You have to work with potential growth in mind. When you launch a product into the marketplace, it's important to already have a plan in place for how to scale up production and distribution in case it becomes successful. Research suppliers to identify beforehand which ones could process a sudden increase in your orders. You can also line up two or more factories to handle big orders. You need to make sure you have the potential structure you'll need--from sourcing components and production to supply-chain management--to accommodate sudden growth.

Are there any indicators to help alert 'treps that a surge could be coming?
Sometimes there are early signals. When you demo and test the product with early users, their feedback will give you a good idea of whether it has the potential to be a hit or not. If you can track the traffic on the web or how people talk about your products on social media, that's also telling. Always have a good process in place to track your sales, especially if you're using the retail channel, where it's hard to get information instantaneously. If you're selling on your own website you can get that information quickly, but if you're relying on Target or Best Buy, they don't give you that information in as timely a manner. Even a few days' notice can help you update your production plan so that you can respond promptly to demand changes.

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