Fluent Commerce CEO Graham Jackson discusses why having an agile inventory management system is key.
During COVID-19 many fashion retailers have been forced to close, particularly in Victoria, with customers given the options of shopping online or through click and collect.
This is a huge challenge for retailers who are now stuck with surplus stock in their stores.
When inventory is siloed across channels like stores and distribution centres or sitting at partner locations, knowing where inventory is and tracking inventory changes in real-time – including in-transit inventory – is a major challenge.
The problems multiply if organisations have inventory segmented by sales channels or are having to work with multiple inventory systems they have accrued as a result of acquisitions over the years. It’s an expensive dilemma for omnichannel retailers.
Because enabling the kind of optimised fulfilment that resonates with today’s consumers and allows retailers to sell everything, no matter means they need a single, accurate and consolidated view of inventory across web, retail, and wholesale channels.
Counting the cost
Without real-time inventory accuracy, fashion retailers find themselves constantly at risk of overpromising or incurring rush shipment charges.
All of which risks compromising profit margins and delivering the kind of poor customer experience that attracts negative reviews on social media.
But it doesn’t end there. Without a clear and accurate view of exactly what inventory is where, fashion retailers potentially risk losing out on sales by saying ‘no’ to customers when they could be saying ‘yes’ and utilising stock that is held in-store to fulfil online orders.
In other words, without a global view of all available-to-promise inventory across the entire fulfilment network, it’s impossible to optimise order fulfilment processes.
Managing all this places a significant load on IT infrastructures. And if inventory monitoring isn’t elastic enough to meet peak demand periods, then escalating inventory calls can overtax or slow down e-commerce sites.
It can also inhibit the ability of omnichannel retailers to cost-effectively and efficiently deliver the flexible shopping options that today’s consumers increasingly expect to encounter.
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Achieving real-time inventory accuracy counts across all distribution centres and stores is vital for the smooth operation of fulfilment options like click and collect.
Making everything work in concert depends on being able to track demand for inventory by location and SKU, utilising cross channel insights to balance inventory, and giving customers full visibility of where inventory is so they can make their product selections and choose the fulfilment options most appropriate to their immediate needs.
The problem is that inventory systems have not kept pace with the operational complexity that omnichannel commerce has introduced.
Traditional inventory management software can only monitor the inventory it can see; it’s not agile enough to deliver the extended visibility across all channels that’s needed to ensure that today’s omnichannel retail models exceed customer expectations profitably.
Getting a better view of inventory
As SKUs, channels and distribution outlets proliferate, optimising order management increasingly depends on achieving an accurate and unified real-time view of inventory tracking and all inventory across the entire fulfilment network.
It’s also crucial for balancing inventory to increase turns and reducing unnecessary safety stock that can represent a significant cost burden to the business.
Fortunately, today’s cloud-based distributed order management platforms now deliver the real-time inventory visibility across disparate systems that retailers need to optimise order management and fulfilment in every channel.
That includes turning stores into mini distribution centres, and balancing and re-routing inventory more effectively between channels to optimise omnichannel performance.
Fluent Order Management is the cloud-native order and inventory managment platform that lets you completely customise your business processs.