Why Multichannel Inventory Management is Essential Today
The old days of simple business, where owners only needed to manage one store and interact with customers as they came in, are long gone. With the explosive rise of e-commerce and the emergence of huge amounts of competition, business owners must broaden their horizons in order to stay relevant in the marketplace.
One way to do this is to create an online business presence as well as a brick-and-mortar one, but this comes with its own implications; namely, the need to manage a multichannel inventory.
To that end, let’s examine a few reasons why multichannel inventory management is essential today.
Expanding Businesses Have Changing Needs
When an entrepreneur starts a small business, things might be basic at first – perhaps just one physical store location, or a simple online presence to sell products or services over the internet. If the business remains small over time, whether by circumstance or by choice, the setup could remain this way for a long time.
However, it’s also possible that things really take off, and the owner wishes to expand the business. Multiple store locations, simultaneous physical and digital presences, the need for more inventory, and a greater customer demand will all contribute to a massive increase in the complexity of operations. Unless the business ramps up its inventory management to match, failure becomes more likely.
In such a scenario, a suitable multichannel inventory management system becomes absolutely necessary. There is simply no other efficient way to manage the growing levels of complexity while maintaining a good customer experience.
Online Sales of Products and Services are Booming
The increasing ubiquity of e-commerce is a fact of life now. Online selling has been on the rise for years, and will continue to grow in the future, by all indications.
Not only have global retail e-commerce sales been rising steadily every year, but e-commerce sales as a percentage of all global retail sales have been rising. As of 2021, almost 20 percent of all retail sales worldwide were done online, and this figure is projected to rise to nearly 25 percent by 2026.
Where does multichannel inventory management come into the picture? Given these trends, customers will soon be buying products online, from any location, almost as much as they buy products in physical stores. A business that does not pay equal attention to both fronts risks losing ground against competitors that do. And if a business wants to remain relevant in both areas, it will need an inventory management system that can integrate both channels.
Automation, Tracking, and Forecasting are More Crucial Than Ever
As companies expand, attempt to stay ahead of competitors, and commit more resources to selling products and services online, they will need to keep a close eye on automation, tracking, and forecasting.
Automation is a way for growing businesses to remain efficient even as they sell their products to ever-increasing numbers of customers. A good automated system can help make sure that customers receive their orders promptly, keeping track of these orders throughout the entire process from packing to delivery. An automated system will also replenish stock at the optimal times, share product listings quickly across multiple channels, and more. Such a system greatly reduces the chance for mistakes, missed orders, and angry customers – thus ensuring a steady profit for businesses.
As a business begins to sell via multiple channels, it also needs to manage inventory carefully. In order for inventory to be optimised, there can be neither too little (which would lead to lost sales) nor too much (which would indicate wasted funds and possible spoilage of stock). To achieve the perfect inventory balance, accurate sales forecasting would be needed; to get this forecasting, a large amount of data would need to be compiled into usable insights. Again, an advanced automated system would be invaluable for this purpose.
Conclusion
If you want to maintain relevance in the marketplace in a digital business landscape, you’ll need to stay on top of multichannel inventory management.
Eurostop provides a connected omnichannel system that provides your customers with a seamless experience no matter where and how they buy from you. We also offer an EPOS solution that can enhance customer experience and staff efficiency in-store. Speak to one of our retail experts to learn more.
Want to see a real-life example of how using a good multichannel system can help a business optimise its operations? Read a case study here.
