Real-time inventory management is key to enabling an omnichannel retail experience. Retailers need systems that can stretch across locations, platforms and technologies. Failure to keep up with orders and inventory will cause organizations to fall short of expectations, ultimately costing business.
Predicting patterns in order to properly stock supplies is another challenge the pandemic exposed. IBM’s Supply Chain Blog notes that demand forecasting became increasingly complicated as customers clamored for products via different channels. This revealed a weakness in traditional inventory methods.
Systems for Building Effective Inventory Management
The ultimate goal of a modern inventory management system is real-time visibility. Agility is key during a time when retailers may not know where the next demand will come from.
“A real-time view of inventory across store locations, warehouses, and in-transit enables retailers to identify mismatches between demand and inventory availability faster,” IBM notes.
Systems must be able to track an entire inventory process. According to NetSuite, this should start with the creation of a centralized record of products, then move through location and price tracking, all the way to assessing key performance indicators.
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When creating a system, integration is key, according to a ShipStation blog. “It doesn’t matter if you fulfill every purchase using store inventory. In-person transactions and online orders still impact stock differently. And if you choose to have your merchandise spread across multiple locations, a single source of inventory truth is especially necessary.”
Technology for Inventory Management Systems
Executing these integrated, real-time systems requires technologies working together to deliver the most comprehensive solution.
One element is a solution that can alert users instantly when inventory is overstocked or low, according to IBM.
“With demand shifting across store locations, retailers can monitor inventory levels and reallocate inventory to locations where demand may be higher,” the blog notes. Having built-in artificial intelligence can also help predict needs within channels and locations, allowing retailers to properly prepare.
When it comes to tracking inventory, radio frequency identification is a valuable tool.
“Out of the box, RFID can provide highly accurate information about where an item is in the supply chain, such as on a truck or in a specific store, and where to find it in the store,” notes a report from McKinsey. “This helps store managers plan and adjust staffing based on quantities and the timing of truck arrivals and improve pick timing for online orders, store replenishment, and customer requests.”
By accurately tracking products, leveraging tools like AI and integrating data into a centralized system, retailers can build an inventory management strategy to power a new era for the industry.