The Festive Season Inventory Hangover: Why Indian D2C Brands Overshoot Every Year

It's mid-December. The Diwali sale is long over, the Navratri gifting wave has subsided, and somewhere in a warehouse in Bhiwandi or Okhla, a brand is staring at three months of dead inventory it can't move without a 40% discount. Meanwhile, its best-selling SKU sold out on day two of the sale, leaving ₹30 lakhs in potential revenue on the table and three unhappy marketplace account managers on WhatsApp.

This is not bad luck. It's a structural failure that repeats itself so reliably you could set a calendar reminder. The same brands, the same mistakes, every year. The tragedy is that the post-mortem conversations I have with founders in November and December are nearly identical to the ones I had the year before.

The Two Failure Modes

Every festive season inventory disaster is one of two things, or both:

Stockout. You sell out of your best-performing SKUs within 48 hours of a major sale going live. You scramble to replenish, but your manufacturer needs 10 days. The sale window is 7. You miss ₹X in revenue and your marketplace listing takes a visibility hit because your conversion rate dropped when you ran out. You estimate the loss but never actually quantify it.

Overstock. You ordered 3x of everything "to be safe." Your demand came in lopsided — high on two SKUs, almost nothing on the rest. Now you have 6 months of slow-moving inventory tying up working capital at exactly the moment you want to invest in January growth. You run clearance sales that train your customers to wait for discounts. Margin suffers. Morale suffers.

Most brands experience both in the same season: stockout on winners, overstock on losers. The combined effect is worse than either alone — you're simultaneously leaving money on the table and trapping capital you could have deployed.

Why Gut-Feel Forecasting Fails Every Year

Amara's Law says we overestimate the impact of a new technology in the short run and underestimate it in the long run. There's an operational equivalent for festive planning: founders systematically overestimate how much their intuition has improved since last year, and underestimate how much the market has shifted since last year's numbers were recorded.

The typical festive planning conversation goes something like this: "Last Diwali we did ₹80 lakhs. We're growing 40% YoY, so this Diwali should be ₹1.1 crore. Let's order for ₹1.3 crore to be safe." This is not forecasting. This is last year's number with a vibes-based multiplier and a buffer applied to cover the anxiety.

The problems with this approach are compounding:

• Last year's channel mix may be very different from this year's. Blinkit didn't exist in your portfolio two years ago. Modern trade wasn't live. Each channel has different demand patterns.
• SKU-level velocity is not uniform. Your bestseller from last October may have been displaced by a new variant you launched in May. Applying a uniform growth rate across the catalog is wrong.
• The competitive landscape shifts. A competitor launched a gifting bundle that cannibalizes your core gifting SKU. You don't know until sell-through numbers come in.
• Consumer timing has changed. The sale window matters. Diwali falling on a Tuesday versus a Friday changes purchase timing significantly.

The problem isn't that founders are bad at forecasting. The problem is that they're using backward-looking data to make forward-looking decisions, without any mechanism to update as new signals arrive.

What Data Signals Actually Matter

The right festive forecast is built from a small number of forward-looking signals combined with historical patterns at the SKU and channel level. Here's what I'd track:

Sell-through rates by SKU and channel from the last 90 days. Not just total sales — what percentage of available stock actually sold through, and how quickly. A SKU that sells through 95% of stock in a week has a very different demand profile than one that sells 60% over a month. This tells you velocity, not just volume.

Channel-level growth trends from the last two festive seasons. Marketplace growth is decelerating for some categories and accelerating for others. Your own D2C site may be growing faster than quick commerce. Each channel's forecast should be independent, then summed — not a top-down number split across channels.

Historical volatility by SKU. Some SKUs are predictable. Some have huge variance. A SKU with a coefficient of variation of 0.6 deserves more safety stock than one at 0.2. You can't run the same buffer across your whole catalog.

Early demand signals: pre-sale wishlists, early-access orders, and search trends. If your marketplace gives you pre-sale wishlist data, it's one of the most underused leading indicators available. A SKU on 5,000 wishlists will behave differently than one on 500.

A Practical Planning Calendar for Festive Prep

The festive season in India runs roughly Navratri through Diwali (mid-October) with a tail into December for Christmas and corporate gifting. Working backward:

T-12 weeks (mid-July): Pull SKU-level sell-through data for the last 2 festive seasons. Identify your top 20% of SKUs by velocity. These are your must-have, never-stockout items. Start procurement conversations now.

T-10 weeks: Finalize your channel-level targets based on current growth rates, not last year's actuals. Get your top-performing channel's purchase orders issued so manufacturers can plan production runs.

T-8 weeks: Audit your packaging and gifting SKU production timeline. Gifting boxes and hampers have the longest lead times and the highest stockout cost during Diwali.

T-4 weeks: Check warehouse capacity. If you're using a 3PL, confirm space bookings. Festive season 3PL capacity gets constrained. Don't assume your usual slot is available.

T-2 weeks: Final reconciliation of what's in stock vs. what's been ordered. At this point, you should be in "buffer" mode — not "planning" mode. If you don't have the stock now, it's likely too late to order and receive within your delivery windows.

T+1 week (post-sale): Run your fill rate report and your sell-through report by channel and SKU. Document the actuals. This is your primary input for next year's planning. If you don't do this now, you will repeat the same mistakes.

Building a System vs. Solving It Anew Each Year

The brands that handle festive inventory well don't have better intuition than everyone else. They have better systems. They've automated the sell-through tracking, they've connected procurement lead times to order windows, and they review SKU-level data monthly rather than quarterly.

The brands that struggle year after year are solving the same problem from scratch each October, usually under time pressure, usually with incomplete data. The cost isn't just the stockouts and the dead inventory — it's the opportunity cost of all the hours your ops team spends firefighting instead of building.

At FilFlo, we've built tools specifically for this: SKU-level demand tracking across channels, procurement timeline integration, and festive planning templates that pull from actual historical data rather than gut feel. The goal is to make the festive plan a data exercise, not an anxiety exercise.

The next Navratri is ten months away. That's actually plenty of time to fix this — if you start now.

Running into festive planning problems? I'd like to hear about them. Find me on Twitter.