Inventory management is a common target for innovation every time advancements hit retail. Be it in the form of streamlined supply chain processes or enhanced demand forecasting and other inventory-related integrations and automation, these innovations kick off new trends that eventually change the face of retail. This especially holds when new trends prove successful.
So, why are businesses fascinated with inventory control?
Goods are exceptionally valuable. Businesses can’t simply acquire inventory. They need to store, safeguard, and manage it. Yet, these all come with a cost. They can even cost you more if the inventory management is poorly done. It is not surprising then to see supply chain managers scrambling to find cost-saving technological advancements in managing inventory.
Data from Statista show that 1 in 2 retailers and manufacturers invested in warehouse management in 2017. This is a significant jump from only 40% in the previous year.
As customer expectations rise amidst the increasing globalization of supply chains, inventory management software will swoop in to save the day. Thus, you need to watch the latest inventory management software trends carefully if you don’t want to be left out in the competition. You need to keep up with the most recent innovations to reduce operating costs and improve processes.
Below are the seven latest trends in inventory management software:
1. Pick-to-Light Systems
Consumers are opting for quick delivery. This makes a pick-to-light system important. This feature, which was developed a few years ago, utilizes a lighting method to streamline inventory management. As you select items in a bin in your storeroom, you’ll be required to switch off a particular light directing other store operators in the right direction. It will help you locate products in an inventory or warehouse quickly and facilitate easier deliveries to customers.
2. More Personalization
The turn of the 21st century sees more retailers introducing personalization to their inventory initiatives. Aside from mentioning a prospect or existing customer in SMS or an email, more sophisticated personalization methods are emerging. This impacts positively on revenues, with Amazon reporting 35% of its sales using more advanced personalization.
One example of a personalization method includes deploying artificial intelligence to keep track of the shoppers’ returned goods versus those products kept and recommended based on customers’ sizes. Other software suggests product sizes based on the buying behaviors of customers. It also particularly pre-selects sizes that a shopper usually chooses.
3. Season-Based Product Suggestions
Inventory management software that allows inventory adjustment based on real-time and forecasted weather conditions is a growing trend. You will not, for example, see winter-related products such as cardigans during summer or swimsuits during rainy days. Walmart is just one of the few retailers who already started this trend.
Managing your stock inventory in line with seasonal factors will help you avoid experiencing obsolescence, stockouts, or overstocked goods when seasons pass. All of these can cost you a lot of money to store stock and insure them in your warehouse. Moreover, you are more exposed to experiencing natural disasters, damage, or theft when you are overstocked.
4. Advanced Sales Forecasting
The increasing demand for a personalized customer experience means you have to ensure that you always have available stocks. You need to provide your customers the products when they need them. You don’t want to disappoint them with stockouts. To achieve so, you need a better sales forecasting method. You have to be sure of how many of the particular products must be on the shelf next week or next month.
With this in mind, several retailers are leveraging technology solutions to come up with their forecasts. The best inventory management software can provide you with a predictive analysis of your sales and stock movements and offer suggestions on what and how many products you need to order.
5. Streaming Analytics
The use of real-time data or the so-called ‘streaming analytics’ to make decisions is growing along with the increasing prominence of personalization and customer-centricity. We now see more businesses finding various technologies and architectures that integrate real-time analytics on streaming data into their systems. While the concept is nothing new, it is becoming more valuable than ever. This is because it aids you in becoming more data-driven, and it boosts the effectiveness of your personalization models.
Below are a few advantages of real-time streaming analytics:
- You obtain real-time data on suppliers to gauge their performance.
- You will know supply price changes so you could adjust inventory accordingly.
- You can quickly replenish inventory to avoid stockouts.
- You remain up-to-date with information regarding supplies and expected delivery to you.
- You can forecast future demand better.
Here is a list of inventory management system solutions for your easy reference.
6. Experiential Retail Inventories
With experiential retail growing in usefulness and prominence, inventory management software that powers them grows as well. Shopping nowadays no longer means going to the shop and looking at a large inventory. It could now mean trusting experts to choose item selections. From small-sized retailers to big brands such as Apple and Amazon, every business is introducing experiential retail initiatives in various ways. And while it’s undoubtedly a good move, managing inventories in experience-first stores is entirely different from conventional stock control. Successful implementation requires a robust order management platform. The best program to keep track of inventory enables you to see a clear overview of what products are available in-store and your supplier. It should also allow you to move the stock from one warehouse or store to another quickly and that everything must be centrally managed from a single system.
7. Omnichannel Retailing Stock Control
A study by Think with Google found that online shops engaging in omnichannel retailing are on the market lead, attracting 9 in 10 consumers who switch between at least three apps each day to shop. The data exclude consumers who go to traditional brick-and-mortar establishments. So, you can imagine the revenues coming in from multiple online channels and your physical shop as well.
However, the earnings advantage from multichannel selling requires a serious inventory management responsibility. To take on this challenge, businesses should look for inventory management software with reliable inventory control systems for sales that come from several channels. More and more companies are even capitalizing on advanced data analytical methods to leverage store-level data. Such a tool can help avoid stockouts as it enables you to control distribution channels and store supply chains. It comes with three primary solutions:
- Inventory control – It allows you to improve future product demand forecast as it alerts you about current stock levels.
- More distribution centers – It helps match the levels of complexity that stock management and distribution gets.
- Stable safety stock level – As overstocking is as bad as stockouts, an automated inventory management system helps you set up a sweet spot for your safety stock level.
Should you Invest in Inventory Management Software?
Change is indeed the only thing constant and inevitable. If you want to remain in the race, your only option is to adapt to the changes. You need to stay open to innovations to keep your business running as efficiently as possible. Having access to the right information wherever you are and whenever you need it is a challenge that only advanced technology can solve. This is exactly the reason why inventory management software is growing in prominence. While this technology might not solve all inventory-related issues, it dictates the future of inventory management. It enables businesses of all sizes to apply artificial intelligence, cloud computing, and automation to enhance accuracy significantly.
Aside from the advantage of having a clear view of inventory levels and the ability to transfer inventories faster across the supply chain, businesses are making safer working ecosystems. With the right inventory management software in place, they are redirecting their workforce to manage valuable activities and equipping them with vast information, which they can revisit anytime to improve decision making.