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As consumers’ shopping demands shift and market trends evolve, retailers must scale their omnichannel operations to meet these needs. One key strategy is ensuring inventory management remains a top priority. Effective inventory management provides retailers with valuable customer data and helps mitigate supply chain challenges in a global marketplace.
Mark Engebretson, Global Operations Lead at Faherty Brand, shared several takeaways related to this from his 40-year-plus retail career during an Endless Aisle podcast conversation with Marcus LaRobardiere, NewStore’s Vice President of Marketing. Mark and Marcus discussed why inventory management is important for omnichannel success and how approaching retail with a solution-first mindset yields better results than chasing trends.
Read on for more key insights from Marcus and Mark’s discussion, and click here to listen to the full podcast episode.
Mark emphasized that retailers should prioritize inventory management and omnichannel capabilities. This allows them to meet consumers wherever – and however – they prefer to shop.
“Your inventory is probably your greatest asset outside of your people,” Mark said. “Managing inventories [is] going to be critical. An omni world is also critical, and folks that aren’t in that yet are going to struggle.
“You have to be lean in your purchasing – and smart. You have to be reactive. And you have to enable tools that will move product where you need it to be, as quickly and as efficiently as possible.”
Better inventory management leads to more inventory visibility. This refers to retailers’ ability to track and manage products’ movement through the supply chain – all in real time. Inventory visibility also gives retailers more accurate data on sales, inventory stock levels, and consumer demand for products.
As a result, brands can make more informed decisions about products they want to stock and better forecast demand for certain items. Additionally, they can mitigate potential challenges around buying too much or too little stock from manufacturers.
Developing a strong supply chain should be of utmost concern to retailers, especially since omnichannel fulfillment helps them reach customers worldwide. According to PricewaterhouseCoopers’ 2023 Digital Trends in Supply Chain Survey, many executives are prioritizing near-term supply chain priorities instead of focusing on actions that can yield long-term value. Additionally, only about 33% of executives claim that increasing resilience remains a top priority as they invest in supply chain technology.
“The supply chain itself, as you think of it from end to end, is doing a lot of expanding and contracting,” Mark said. “The problem is the pieces that make up that supply chain – whether it be inbound, raw materials, factory manufacturing, shipping warehouse operations, allocations, shipping, and third mile – all of those are expanding and contracting at different rates.
“So what you constantly have is stuff banging up against each other. And it’s one of the reasons that people are sitting with a ton of inventory – that expansion and contraction happened at different paces. All of that multiple expansion and contraction [is] going to take a while to finally settle down.”
One way in which retailers can increase visibility into their supply chain is by investing in the right inventory management technology. This will enable them to keep track of serialized inventory, simplify product transfers, and seamlessly receive new items – therefore giving staff more time to spend with customers.
Mark also noted that brands should focus on chasing solutions rather than trends. Retailers should not assume a one-size-fits-all approach for the technologies they choose to integrate into their systems. Instead, they should prioritize the business’s needs when searching for the best technology vendor.
“I’m not trend driven,” Mark said. “I’m problem-solution driven. In terms of our business, I try to run a race backwards. I always go to the finish line first and then run it backwards and figure out what I need to do to get to the finish line.
“So I’m constantly trying to see what we need next and then how we want to solve it. If it turns out that the new technology that’s out there solves it, great. But particularly right now, we need to be focused on our needs and not distracted by the new shiny toy.”
Brands seeking to make a bigger impact within today’s competitive retail marketplace must prioritize developing robust omnichannel strategies. Inventory management plays a critical role in driving omnichannel success, as it enables retailers to evaluate and optimize their current systems and processes.
It also helps retailers bridge the gap between their digital and physical shopping experiences. They can leverage inventory visibility to offer real-time product availability across channels, let customers engage in mixed cart transactions, and allow shoppers to use a variety of fulfillment methods, like buy online pick-up in store (BOPIS).
Ultimately, maintaining real-time views into inventory and related data results in better experiences for retail staff and consumers. If brands invest in the right technology to power their inventory management needs, their chances at omnichannel success will significantly rise.
To learn more about how your business can maximize its inventory management capabilities, speak with one of our experts today.
