Inventory management: Key to business success in an ever-connected world
The tradition is as regular as Christmas itself: Retailers running out of the year’s hottest gift item at the worst possible time. Equally as regular: The post-holiday glut of cable-knit sweaters left unsold. Inventory management – the art of ensuring the availability of just the right amount of product is available at the exact moment a customer wants it – is more important than ever because of E-Procurement.
According to a recent survey in the United Kingdom by the Institute of Customer Service, one in five consumers said they had tried to buy an out of stock item within the past month. More than a third were stymied by an out-of-stock experience in the past six months.
More disturbing findings:
- A quarter said they found an item out of stock even after checking first to see if it was available.
- Nearly a third said they were stiff-armed at the store after seeing a promotion that encouraged them to visit.
- Half of respondents called lack of stock “one of the most frustrating shopping experiences.”
- Thirty-nine percent said the snub made them wonder if the store valued them as customers.
The types of retail outlets suffering the problem most: food (21%), clothing (16%) and electrical goods (9%).
These days, inventory management requires more than a clever holiday forecast. Most likely, retailers who are still struggling have not achieved the 360-degree transparency they need to maximize sales without being left with inventory they can’t sell.
New technology offers a better way
A state-of-the-art inventory management system can streamline daily operations and offer you transparency, from distribution centers to customer delivery. Applications can be layered on any legacy network to track inventory levels through multiple methods, including SKU and RFID. Apps allow you to cull the data any way you need it: product type, bar code, manufacturer, facility or supplier. You can query the database for shelf life or expiration date, for example.
The right inventory system will couple with apps for asset management, transportation management, warehouse management – even invoice management and expense management. Properly configured and automated, all the information should line up so the entire supply chain is visible, from the top down.
Imagine this: It’s even possible now to know the exact shipping container holding your product thousands of miles away and when it will arrive onshore. To mix transportation management metaphors, you won’t be flying blind any more.
You will understand lead times in a whole new light and, ultimately, you’ll make better-informed decisions regarding sourcing strategies in a world filled with connected consumers and fad-a-minute products.
And won’t that be nice when parents are jostling in the aisles for the next Tickle Me Elmo?