Imagine a hypothetical situation, a small or medium retail store that doesn’t have a retail inventory management software for online or offline retail business, on one day, suddenly gets an unexpected rise in orders at once. What do you think will happen? Will the retailer become happy?
Exactly, there will be chaos and of course the retailer won’t become happy because on the first place the store doesn’t have an infrastructure and the workforce to accommodate the sudden increase in the number of customers and secondly, the most important thing is that the store won’t have the required stock which is fine, but what’s worse is, because of lack of efficient inventory management solutions the customers won’t know when the product has gone out of stock online and offline.
It can also happen that a customer sees a product available online but when he/she goes to the store the product is not available there because of poor inventory visibility.
The sales team, marketing team, the partners of your business and the production team have done their jobs. But still, there is confusion and the actual sale conversion is not as it should be, in fact, added to that there is inconvenience caused to the customers. In short, the sales are affected and the opportunity to make huge profits is gone. Added to that, the unavailability of a proper retail inventory management software has damaged the company’s image as well.
What Went Wrong?
Undoubtedly, it’s the lack of inventory management software. You might be thinking, “Okay so inventory management solutions are important but can you tell me how to increase sales through retail inventory management software in detail?”
Well, of course, here are the –
5 Ways How Retail Inventory Management Software For eCommerce Boosts Your Sales?
“Sales team without a proper inventory management solution in place is like an army troop attacking the enemy without a proper backup. You might surprise the enemy initially but to win the entire war you need well trained back up immediately.”
- Allows You To Promote Your Products That Your Customer May Like – In Real-Time
Apt inventory management system instantaneously allows the sales team to understand the needs of the customers and also equips them to offer advanced alternatives to the products that the customers choose thus creating an opportunity of upselling. Also, if there is a product that has not been sold for a long time the salesperson can spontaneously identify that product from the system and offer an additional discount to the customer to secure a sale from the difficult customers with the budget issues.
This way you will be able to increase sales through retail inventory management software because it will provide real-time inventory visibility.
- Increases Your Bottom-line
Increasing sales can sometimes mean elevated operational costs and hence decreased bottom –line profit. Bottom-line profit is the exact amount you take home i.e. the gross revenue minus the operational costs. With the help of efficient inventory management software, the operational costs can be taken down by a huge margin and the bottom-line can be increased significantly because the software decreases the manpower required along with making the customer experience smooth and reducing return and replacement hassles.
- Fulfills Multi Channel Orders
According to research, 29% of retailers lack inventory visibility across stores, vendors, and warehouses that are necessary to fulfill multichannel orders. Needless to say that inventory management solutions can benefit these retailers to bolster their customer experience and increase sales without any hesitation.
The software would provide a centralized portal where the retailer can locate the in-stock products and schedule automatic order placement of the soon to be out of stock products. This would enable businesses to sell their products to the customer on any channel they want to buy without creating a situation where the customer goes through a bad buying experience. Consequently, retailers can increase sales through inventory management software.
The most appealing feature of the retail inventory management software is that you can not only achieve multichannel order fulfillment but also can march towards achieving the omnichannel order fulfillment that can boost your in-store and online sales. According to research, the consumers are likely to spend 4% more while shopping offline and 10% more when shopping online.
- Shortens The Lead Time
The consumer will always buy from the retailer that fulfills the order in a shorter duration. The time needed by the brand or retailer to deliver the product to the customer can be made specific and shorter if you have advanced retail inventory management software for eCommerce that allows you to be sure of the delivery time. Automated Inventory management system like Orderhive provides 3PLs with the help of which you can ship your products a lot quicker.
For instance, you suddenly plan a short camping trip this weekend, but, you realize that you need a tent and it’s already Thursday. You search a few online eCommerce platforms, one says that it will deliver the product in 2-4 days while the other company promises the next day delivery. Obviously, you would buy from the merchant that offers a shorter delivery period.
Therefore, by promising a quicker delivery, you can increase sales through inventory management software that automates your order fulfillment process with very less operational cost and effort.
- Lowers The Investment In Inventory Stuffing
Did you know that overstocking costs approximately $1.1 trillion to the businesses around the world annually?
Previously, the companies used to stuff the inventory like anything because they didn’t have any proper inventory management solution. In many cases, one or the other seasonal products that could have contributed to extra sales in the coming festival month were forgotten. Due to this and many other minor human errors, the business had to suffer hugely.
However, now there is a sense of awareness in eCommerce giants regarding overstocking and unnecessary investments and hence most of them use retail inventory management software. A proper Automated inventory management system for eCommerce would empower you to calculate Available To Promise stock i.e. ATP to ensure the exact amount of orders you can take for a particular product. This would also help you to decide when the stocks should be ordered.
Increase sales through Orderhive – an AI powered retail inventory management software that provides automated order management system that keeps track of inventory and orders so that you never go out of stock while maintaining the required inventory level. This way it would save you from saying no to a customer and retain him/her.
“According to a survey, the stockout instances can increase the probability of buying from another store by 20%.”
It would also increase the inventory turnover ratio because of the proper flow of products and you won’t be overstuffing/ overstocking your inventory. This also saves the unnecessary investment of money that sits on the shelves for a long period and does nothing. You can also know the KPIs –Key performance Indicators and invest more money in the right place rather than spending haphazardly. Ultimately, managing your inventory smartly would increase sales and increase your bottom –line as well by reducing unwanted investments.
To conclude, the above mentioned 5 ways are the sure-shot methods you can increase sales through inventory management software. In the competitive eCommerce environment with the big players like Amazon and eBay being in the market, you ought to have a retail inventory management software that will give your sales a much-needed backup. As a result, the sales team of your company can have the exact knowledge of what’s in the store and what they can promise or promote, just like the big players.
Know your inventory to grow your sales
Automated Retail Inventory Management Software and Sales FAQs
Inventory management software is a unified portal that manages and tracks inventory, supply chain, order fulfillment process, returns, shipment tracking, and purchase. Moreover, the AI-powered automated inventory management system, especially orderhive, automatically generates all sorts of reports and performs analysis on the inventory behavior and flow. The software comes with several automation triggers that proactively perform all the mundane tasks like creating picklist, shipping labels, manifests, invoices, confirming orders, notifying low stocks in different stores, and inventory. The SaaS inventory management software can be easily connected to different Marketplaces, CRMs, POSes, Accounting softwares, etc.
Accurate demand forecasting would help you stock your inventory in the right way so that you don’t run out of stock and loose on sales. Especially, in a festive season when going out of stock for one product can lead to a loss of several hundreds of thousands of dollars. With correct demand forecasting through an automated inventory management system for eCommerce, you can check the accuracy of the demand forecasted aswell.
Yes, obviously because when you add inventory you give your buyers more options ( varied range of colors, size, design, products,etc.) to buy from. Hence, this would attract more visitors and Amazon is the best and the biggest example of this, it sells almost everything and with its efficient order fulfillment process, it attracts traffic of people from almost anywhere.
Make sure you have automated inventory management software for retail and ecommerce before you plan to increase your inventory.
Inventory to sales ratio = Average Inventory / Net Sales
Average Inventory = (average of start + end inventory)/2
Net Sales = gross sales – returns.
Inventory to sales ratio determines the relation between its inventory and sales while giving you an idea of how your company’s inventory is performing. The smaller the figure of the ratio the better is your company doing because that indicates that your net sales are high while your inventory is low.
However, there is one catch in that, there are chances that your inventory to sales ratio is low because your sales are low and because of that you are keeping low inventory as well. So, don’t entirely rely on inventory to sales ratio and keep an eye on inventory levels and sales individually as well.