Establishing the best store logic to get orders flowing
People hate waiting. Whether it is for food at a restaurant, a program or movie to finish downloading, in line at a retail store or for a product ordered online, people get impatient quickly. And when people get impatient, that may tarnish the customer relationship.
When it comes to shipping time, retailers need to walk a fine line. No customer wants to feel like he or she is waiting forever to get a package. But at the same time, shoppers often aren’t willing to pay extra money for expedited shipping. This means retailers need to to send packages quickly, but also need to be careful how they do it – they cannot spend too much money or else they run the risk of eating into their already-thin profit margins.
This is where better inventory management comes into the picture. Multi-channel businesses may stock their inventory at numerous locations – with drop shippers, at regional distribution centers and within brick-and-mortar stores themselves. Better inventory management solutions can use preprogrammed logic to help retailers automatically identify the best source to fulfill orders from and can minimize shipping time considerably when used effectively.
Ironing out the kinks in order fulfillment and inventory management
Inventory management and order management have traditionally been top challenges for merchants. It is not unusual for errors to occur on a daily basis, whether it is making a mistake in picking an item (even something as simple as choosing the wrong color or size) to fulfilling the order from the wrong location. The ramifications of these mistakes can vary – in some cases, it results in slower delivery and in others, it can negatively affect customer relationships. If a person is trying to make a purchase for a deadline – a birthday or holiday, for example – the last thing he or she wants to do is have to exchange an item because he or she didn’t receive the right color.
Merchants leveraging omnichannel strategies face even greater complexities as they try to successfully manage inventory across all channels and fill orders in the most effective way possible. Fortunately, the rise of new technologies make the process that much easier.
As Multichannel Merchant noted, the same technology that has allowed retailers to effectively consolidate inventory across all channels into a single pool also enables them to automate inventory management and fulfillment in a way that should help them eliminate critical errors. The key lies in the logic established by retailers and the ability to automate the execution of this logic. Inventory management solutions can be programmed to look at numerous factors, ranging from customer proximity to quantity of inventory available, and use this information to send orders to the right channel every time.
Adjusting to the retailers’ needs
Depending on merchants’ priorities, this flexibility allows them to pursue any number of objectives, whether it is reducing costs, expediting delivery times or anything else. For merchants that want to get items to customers quicker, that may mean fulfilling orders from the closest location to customers – whether it is a drop shipper, a physical store or a distribution center.
Of course, part of being a successful retailer is being able to react to conditions, so perhaps merchants may want to measure delivery speed against other relevant factors. For example, it may be quicker to send a purchase from one location, but if that order will result in an out-of-stock, sellers may want to consider otherwise. By establishing the right logic, merchants can create contingency plans for all of these potential issues.
“Whether sales orders originate from company websites, Amazon, or the telephone, best store logic ensures that fulfillment is optimized to occur from whatever location best serves the goal dictated by the retailer,” Multichannel Merchant contributor Ian Goldman added. “This directly leads to better sell-through, higher customer satisfaction and reduced inventory carrying costs.”
As retailers look to improve their ability to engage customers, it is crucial they look at the tools they are using to execute their operations to address real concerns. If getting items to shoppers promptly is an issue, they can use inventory management and order fulfillment solutions to create algorithms that can not only improve turnaround times but can also bolster behind-the-scenes operational efficiency.