Retailers and brand owners are once again facing major challenges: ongoing supply chain problems and cautious consumer behavior due to rising inflation and the cost of living - to name just the most important ones. At the same time - overfilled warehouses and the desire of retailers to sell off these stocks profitably and promptly. However, many purchasing processes still fail because many retailers do not have accurate, timely and sufficient visibility of their stock.
Inventory management in omnichannel retail: the key to sustainable success
If retailers are not only fighting for their survival in the omnichannel sector, but also want to make their business sustainably profitable, it is essential to manage stock optimally and significantly improve the visibility of stock data across all channels. The decisive factor here is to provide the right product at the right time in the right place for the customer and to display this availability to them in real time.
In a study conducted in the fall of 2022 in the US, UK, Germany and Australia, in which around 4,000 respondents took part, 68% of consumers stated that buying a product that is displayed as available online but is actually no longer available has a negative impact on their opinion of the retailer.
It is unlikely that a disappointed customer will give a retailer a second chance if a competitor currently has the desired product available and can offer it immediately.
Order Management: The solution for accurate and real-time inventory data in omnichannel retail
Most retailers rely on data from their ERP system, the so-called Inventory Master, for their inventory data. However, these systems often struggle to continuously update stock and display it across all channels. As a rule, inventory updates are made at longer intervals, which leads to delays and inaccuracies. As a result, a customer may buy an item that is displayed as available but is actually no longer in stock (overselling). Or an item that is in stock is displayed as not available, so that the consumer is unfortunately unable to purchase this item (underselling).
Fluent Order Management closes precisely this gap. For us, order management starts with accurate and real-time visibility of inventory data across all channels and warehouses.
Why better and real-time visibility of inventory data leads to more sales and happier customers
1. no more order cancellations
One of the most costly scenarios for retailers is when a customer purchases a product and is later informed by the retailer that the product is out of stock and the order must be canceled.
Canceled orders are problematic in several respects: they not only result in a refund of the purchase price, but also a negative shopping experience and - not infrequently - damage to the retailer's image.
Better inventory data enables retailers to only sell goods that are actually available.End consumers can see in real time which goods are available and where exactly they are located.This results in less time spent processing canceled orders and fewer overall complaint calls to the retailer.
2. returned goods can be resold more quickly
Some systems take days to show returned goods as available for sale again. In the meantime, these same products could already be offered to new customers.
A retailer who can update their stock data as quickly as possible after a return and add it to their inventory has the opportunity to offer their products for sale again more quickly and generate sales.
3. lower storage costs
A retailer with real-time stock levels is able to drastically increase its stock turnover and significantly reduce safety stock.If these safety stocks are no longer necessary, inventory and warehousing costs are reduced. And in the best case scenario, these savings can be passed on to the customer in the form of lower sales prices.
4. better advertising cost ROI
As there is often a lack of up-to-date and accurate stock data, products are often advertised that are not actually available. This not only has a negative impact on the customer experience, but also on advertising ROI.
Advertising expenditure can be used much more effectively if real-time inventory data is used to advertise only those products that are actually available.
The result: More satisfied customers and a better advertising ROI.
Conclusion
Omnichannel customer satisfaction depends heavily on the accuracy, quality and speed with which inventory data is updated.
A real-time overview across all channels and warehouses helps retailers to react quickly to changes in consumer behavior, improve the customer experience, increase loyalty and - last but not least - generate more sales.
Jamie Cairns
