Retail companies must know what's available in their warehouse or stockroom.
Customers who visit retail locations expect to find shelves properly stocked with the merchandise marketed by the business. The Motley Fool reported the Urban Outfitters retail company fueled recent growth and renewal through an efficient inventory management system. After eliminating mistakes in its old process, Urban Outfitters can now turn around stock faster than other major brands.
Ensuring businesses have the necessary products on hand is essential to making customers happy. Businesses have to be careful not to overstock so they don't lose money to unsold merchandise and storage. IHL consulting group research discovered overstocks and out-of-stocks cost global retailers $1.1 billion in sales annually.
Here's how a retail business can avoid the problems and redesign inventory management systems for consumer satisfaction:
Makes Inventory a Priority
It can be difficult to anticipate consumer demands, so flexibility is important. Businesses can take steps to ensure they have the right stock on hand by making inventory management an important part of daily practices.
When redesigning inventory procedures, decision-makers should start by removing out-dated practices - like pen and paper counts - and implement real-time data collection solutions. New strategies shouldn't be seen as quick fixes, but ongoing tactics for consistent success.
This may require some initial investments. Multichannel Merchant said retailers should prepare to abandon old ideas and inventory and adopt technology and new strategies. Disruption in the present should create solutions for the future.
One way to limit disruption is to adopt strategies and tools that work with existing successful inventory practices and simplify tasks. At the same time, new technology should allow workers to perform more inventory activities in shorter time increments.
Computer World shared information from IHL interviews that said most retail brands only perform one full inventory count a year. Of these counts, discrepancies were common - some companies' numbers were off by as much as 25 percent. If retailers want inventory to be a priority, they need to find ways to consistently account for stock levels and product movements.
Promote Data Visibility
The warehouse isn't the only business location that can benefit from mobile technology. Retail stores can provide sales clerks with mobile devices so they can check inventory levels and place orders for out of stock products while speaking with in-store shoppers.
It's important businesses integrate inventory data with a company's total information system. This means finding an ERP solution like Oracle, which offers cloud-deployed functionality that can link mobile devices and other computing assets.
With a complete information system, every member of an organization knows exactly what inventory is available, when orders need to be made and what products are popular with consumers. This allows marketers to promote specific merchandise and decision-makers to accurately communicate with suppliers.
Prepare for Problems
When performing annual inventory counts, stores are bound to find certain merchandise that did not sell. Even when accounting is more consistent, product problems will occasionally take place and companies need solutions in place.
Modern Materials Handling suggested businesses need to avoid sweeping things under the rug and find permanent ways of dealing with overstocks and stock-outs. Instead of piling excess inventory for massive sales, consistent reporting can show as soon as merchandise levels become superfluous. Automated data collection devices that display information for users can make them aware of what they should do the moment a problem is detected.