Digital Inventory Management Key Battleground in Transformation of Brick-and-Mortar Retail
As e-commerce growth accelerates, shippers are working overtime to manage available inventory. Although e-commerce represents 10 percent of total retail sales, it has had an interesting effect. It catalyzed brick-and-mortar retailers to offer online shopping opportunities, which require much more than manual inventory management practices. As a result, brick-and-mortar retail has become more focused on digital inventory management, a building block in the road to omnichannel supply chains, than in the past. Warehouse Managers need to understand why this is happening, its implications, and how digital inventory management can benefit brick-and-mortar retail.
Brick-and-Mortar Retail Is Often Left Behind in the Digital Inventory Management Conversation
As explained by William Terdoslavich of DMN News, customers expect instant gratification when purchasing products in-store, and the same feeling exists when making an online purchase. Customers expect to receive online purchases as scheduled, so any deviation from planned delivery, pickup, or shipping could translate into severe consequences, including the loss of a customer. This amounts to copious inventory management practices in place to ensure product is available in brick-and-mortar retail, as well as online shopping portals. The days of managing stock in individual channels are over, yet shippers must still manage stock for each channel.
Wait. That’s two entirely different things.
This is where the major problem lies. Retailers must approach inventory management from a channel- and customer-specific point of view, while considering the needs of the omnichannel supply chain as a seamless system. The confusion implies the need to understand how digital inventory management translates into better overall supply chain management and effective management of brick-and-mortar retail.
The Right Digital Inventory Management System Considers Brick-and-Mortar Needs Too
According to Paul Nugent of ShopKeep, retailers seeking to implement a digital inventory management system should consider these factors in the selection process:
- Cost of the system. It is important shippers consider their needs. The biggest and most expansive system may not necessarily be the best system for your organization, reports Bridget McCrea of Logistics Management.
- Ease of use and training requirements.
- History and experience of the software vendor.
- Ability to create customized reports and use analytics to improve inventory forecast accuracy.
- Compatibility with existing systems and optimization of bin-level controls.
- Multi-location deployment versus limitations.
- Support during and after implementation.
- Availability of use for wearables and automated inventory tracking systems, like radio frequency identification (RFID).
Tips to Improve Brick-and-Mortar Inventory Management Through Digital Systems
The use of a digital inventory management system can help shippers gain control and visibility into existing inventory and plan for future inventory needs. To guarantee success, Warehouse Managers should follow these tips:
- Track the movement of inventory through multiple channels.
- Monitor inventory in all stages of the supply chain from manufacturing to returns, explains Andy Henderson via General Electric.
- Use big data for simulations and modeling to understand inventory flow in brick-and-mortar.
- Gain real-time visibility into inventory, especially perishable inventory, automated technologies, such as RFID and the Internet of Things.
Move Into the E-Commerce Revolution With Digital Inventory Management Today
Traditional methodologies for managing inventory are inefficient in e-commerce. Although fears over the “Retail Apocalypse” continue to exist, retailers can leverage the power of the e-commerce Revolution and digital inventory management styles to ensure brick-and-mortar success.
Veridian, a Manhattan Associates, HighJump, and JDA warehouse management system implementation company, can help you realize your supply chain success. Fill out the contact information below in order to schedule a consultation call with one of our supply chain professionals.