It makes sense to connect both physical and digital stores – it makes for a more holistic shopping experience and can enhance profits. In addition to these benefits of such an omnichannel approach, it can also make for much more efficient and improved inventory management.
By having scrupulous visibility of all of your inventory – no matter which channel it is sold through – you can plan better and improve forecasting, prevent overselling, in addition to simply making it easier for everyone who works within the organisation.
What is an Omnichannel Approach?
Omnichannel merely means multiple channels. Instead of your customers only being able to make a purchase through one or maybe two avenues they can move back and forth between different avenues ultimately leading them towards a sale. So, they can read your customer service interaction on Facebook, get an idea of your branding on Twitter, touch and feel the product in store, read its specifications on their mobile on their commute, before finally popping it in their basket from their laptop.
However, it’s not enough to simply have these different channels. That doesn’t make you an omnichannel retailer. What does is how these different channels are interconnected, and in so doing create a seamless entire customer experience. So, for example, your social media platforms actively drive traffic to your website, and your website actively drives customers towards your physical store.
How Does This Help Inventory Management?
Improved inventory management is, in many ways, simply a by-product of omnichannel retail. It’s not usually the primary goal, but it is inordinately worthwhile. The reason for this is that when your system is truly omnichannel (not just a group of distinct channels) then you have no choice but to have your inventory under one overarching control. It doesn’t matter where or when someone makes a purchase, your inventory is updated full stop. It’s automatic and it’s the simplest way of both gaining insight into your inventory efficiently, and eliminating the risk of over-selling or running out of stock.
How Do You Create an Omnichannel Approach?
There are two primary ways that you can turn your multiple channel retail business into one which is more genuinely omnichannel. The first involves using a software platform which brings all of your data points (sales, customer data, and inventory) together in real-time. The other involves utilising a number of different solutions which ‘talk to each other’ so that information and data flow to where it is needed.
Solution 1: One Platform
Arguably, this is the solution which makes the most sense. You simply have one platform which brings everything together and which can be accessed, constantly, in real-time. This shouldn’t be too difficult. The vast majority of Point-of-Sale (POS) system providers, as well as e-commerce platforms, are now offering suitable omnichannel options.
However, don’t just take their word for it, do your research and explore which solution would be best for your specific retail needs according to what you need in-store and online. It’s not unusual to discover that a system is better in one area than another, so it needs to suit you.
The nature of these systems, nonetheless, is that you gain a bird’s eye view of orders and inventory, and can match one to the other more seamlessly. You’ll be familiar with this without knowing it – if a product sells out instore it automatically goes out-of-stock online without you manually having to enter that fact. It eliminates the steps which slow down the process and open it up to error.
Solution 2: Bring Different Systems and Platforms Together
Smaller businesses may not have the resources to go for one platform, they may also find it doesn’t actually work best for them. It’s great when the business is large enough that it’s somewhat of an unwieldy beast and your left-hand needs to know what the right is doing. Smaller retailers, however, have a different set of problems and therefore need different solutions. More specifically, the smaller the retailer, the more unique these tend to be. Therefore, it is unlikely that you will find one single platform, at a sensible cost, which does the right job and you’ll do better to utilise different systems which work well together.
For example, this might mean utilising your POS solution hand-in-hand with your e-commerce solution. This requires specific integrations so that you can be sure you’re not stuck with multiple entry points which cause inefficiencies and provide room for error. In this way, you’ll also improve your inventory management as you’ll have a more accurate and holistic view.
Are Inventory Management Problems Eliminated with an Omnichannel Approach?
Whilst inventory management should certainly be a considerably simpler task by integrating your different sales channels through an omnichannel approach, it doesn’t eliminate all risk, such as overselling, entirely. These errors will still occur, they just shouldn’t occur anything like as frequently, or so broadly. When this happens, you will need to revert to your old-school methods of customer service and notify the customer as soon as you can.
However, the problems as they do occur are still likely to be down to human error – someone has failed to update something somewhere. But the scope for human error is considerably less when every entry is going through the same holistic channel. These potential errors are far less likely than in systems where you have to manually go back and forth between different stores and channels to check stock – you should always have a view of it all in one place.
What You Need to Do
You need to look at and evaluate the different options available to you with the systems you already have, and what you are looking for. We understand that this can be a tall order. Our consultants are experts in advising and creating the best omnichannel approaches according to your size and need and ensuring a seamless transition which will represent an excellent return on investment in time. Call us on +44 (0) 121 517 008 to see how we can help.