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Eight ways inventory data can transform your fashion retail business
Posted on by cassie
Inventory optimisation is a critical consideration for any omnichannel fashion retailer—and improving this crucial area relies on high-quality data that provides the insights you need to drive strategic inventory management decisions. From real-time product availability to visibility into carrier performance and product returns, having access to accurate and comprehensive inventory data can empower fashion and apparel brands to streamline their processes, optimise their purchasing decisions, and deliver a better customer experience.
Here are eight key areas that can be significantly improved with the help of data-driven inventory management software:
Out-of-stock products are a major pain-point for shoppers—and each time they occur, they put you at risk of losing both a sale and a customer to the competition. Drawing on data from your inventory management system can help to minimise the occurrence of stockouts, reducing consumer frustration and increasing sales opportunities. As lead times are key to reducing stockout rates, factoring this information in with your sales data can allow you to accurately determine your required safety stock and set appropriate reorder points for each product, ensuring stock is replenished in time to meet demand.
For omnichannel retailers selling stock across multiple sales channels, effective synchronisation of stock levels is essential to prevent products that are no longer available being displayed to online customers.
An up-to-date inventory management solution will allow fashion brands to show available stock levels in real-time and automatically update this information in order to ensure customers only see available products. What’s more, by using inventory count data, multi-channel retailers can accurately calculate how much inventory should be made available on each channel.
3.Accelerate order fulfilment
Nowadays, your customers don’t just want the convenience of online ordering—they want delivery speeds that allow them to enjoy their purchases as quickly as possible. And that’s where effective inventory management can make a significant difference. From automated shipping rules that automatically assign orders to the closest warehouse to optimisation of picking routes, data-oriented inventory management can speed up order fulfilment by streamlining the flow of stock to maximise efficiency and accuracy.
4. Increase sales and profit margins
Good data leads to smarter decisions—and in most cases, those decisions are designed to drive up revenue and profits. Insights from your inventory management software can power more strategic decision-making in key areas such as demand forecasting, purchasing trends, and channel and product line performance.
By analysing the available data on inventory and sales channels, fashion and apparel brands can make changes that lead to improved customer experience, optimised merchandising and purchasing, and better pricing and promotional strategies—all of which can equate to more sales and higher profits.
5.Address carrier issues
Your carrier services can have a major impact on your retail brand, in particular on customer satisfaction and even on the rate of returns. Errors on the part of poor-performing shipping partners—such as damaged goods, incorrect or incomplete deliveries, or shipping delays—can lead to a less than satisfactory experience and the cost to your business of products being sent back or customers shopping elsewhere. Visibility into carrier performance can provide valuable insights into which aspects need to be improved to prevent costly issues. In addition, implementing measures to avoid errors—such as automated alerts if an incorrect product is picked in the warehouse—can greatly improve operations in this area.
From real-time product availability to visibility into carrier performance and product returns, having access to accurate and comprehensive inventory data can empower fashion and apparel brands to streamline their processes, optimise their purchasing decisions, and deliver a better customer experience.
6. Purchase smarter
Another area that can be enhanced with the help of inventory data is purchasing. For example, if insights from your inventory management system reveal a high volume of returns due to poor quality of a particular garment, you may decide to replace the product or even change suppliers. An effective inventory management solution can empower your purchasing decision-makers with data that allows them to make strategic choices about individual product components such as fabrics and colours, through to largerscale decisions that deliver major business improvements.
7. Reduce inventory carrying costs
Optimising the costs involved in carrying your stock can enable significant financial savings for your retail business. The inventory carrying ‘sweet spot’ ensures you have sufficient stock to meet demand, while avoiding the wasted costs of unused warehouse space. As inventory carrying costs are incurred across a wide range of areas—including warehousing and logistics, materials handling, storage, risk-holding costs such as inventory depreciation, and capital and insurance costs—a solution that provides real-time inventory data visibility can help you accurately forecast demand and minimise excess stock.
8. Minimise inventory shrinkage
The impact of inventory shrinkage—the loss of inventory from unforeseen incidents such as theft, damage or products becoming obsolete—can be costly. Using your inventory management data to identify where these losses are most likely to occur can help reduce inventory shrinkage and make inventory processes more watertight. For example, using software to track stock movement and interactions within the warehouse can help to reduce warehouse theft and improve accountability, while implementing steps such as regular cycle counts rather than sporadic stocktakes can enable you to minimise inventory discrepancies.
If you would like to know more about effective inventory management – contact us today.
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