As previously discussed, inventory management requires a lot of attention and has minimal room for error, and it is crucial for businesses to be as accurate as possible. They need the utmost visibility into their inventory and automated processes to simplify their tasks and allow them to do business better. And the most savvy brands and retailers rely on real-time inventory data as well as their historical data to do so.
Real-time inventory makes it simpler for businesses to view their current inventory, track their sales, manage returns and product for replacement, and keep track of items for the entire product lifecycle: manufacturer to warehouse to customer.
Real-time visibility into their inventory will allow businesses to better track:
Product location - Inventory goes from the manufacturer, to the warehouse, to the stores (or online). Plus, there is also inventory that’s getting returned. These complexities of product movement require businesses to keep a close eye on all orders in case of any delays or errors and returns to not re-stock product that actually hasn’t been sold.
Markdown planning - Excess inventory ties up cash, and the longer items go unsold, the less value they have. So moving the product is key, and creating a successful markdown plan will allow brands to have a better idea of what isn’t selling, and act on it fast. Real-time visibility will allow these brands to quickly move out the unsold product.
Order placement schedules - Brands must have a schedule of when to 1) order the inventory and 2) put out the inventory. Before fast fashion (think: Zara, H&M) businesses would place their orders six months in advance and have winter coats in stores months before winter would even start. Now that fast fashion has come to play, brands and retailers are still trying to figure out the best supply chain systems and order placement schedules to compete with these new retailing styles.
With real-time systems comes much more accuracy for many of the business’s tasks. There will be less shipment delays since there will be constant updates on exactly where the product is. There will be better analyses from detailed historical data. Order placements and reorders will be much more automated.
And the systems required to provide this type of tracking and information are more complex and newer than those in place 20 years ago. Thus, the brands and retailers who have updated their backend technology have access to deeper insights into their businesses and make more informed decisions. And if this isn’t enough, here are six more reasons to invest in a reliable inventory management system.