According to an article published in The Wall Street Journal, the world-renowned company Columbia Sportswear Company said that their investment in supply chain analytics software that helped them to keep a lean inventory has finally paid off big time. Implementing supply chain analytics software was among the primary reasons why they increased their profits.
Now, this is what the company said three and a half years ago. They understood the importance of improving the supply chain to increase profit by managing the Inventory and orders seamlessly. While Columbia Sportswear kept faith in FushionOps and Manhattan Associates’ WMS and LMS and sailed forward with more significant profits, they also started a project called Consumer- First Platform CI in the second quarter of 2017 to enhance their omnichannel capabilities.
However, according to a report from Market Insider, an exciting development that happened was that the competitor of Columbia sportswear company and world leader in sportswear brands, Nike has already bought a predictive analytics company for inventory management and supply chain management for omnichannel inventory management. They have already gone omnichannel and reaping great benefits. Nike figured out the importance of inventory planning and the benefits of going omnichannel after experiencing a significant margin decline in 2016. They had to sell excess inventory at a discounted rate in North America.
Nike has solved it’s most of its inventory management, supply chain, and order management issues with the help of centralized perpetual inventory management, thus enabling them to track down the Inventory in different channels. As a result, they are updating Inventory instantaneously even though customer orders or returns a product in some other corner of the world. Hence, avoiding inconsistencies in inventories across channels and wastage of money.
Nike reduced inventory costs and increased inventory effectivity simultaneously.
And according to magestore, “shoppers spend 50%-300% more than single-channel shoppers. It makes Nike’s revenue per customer increase. Moreover, 26% of consumers are actively seeking personalized offers, and hence, Nike gets more loyal customers who would return to buy more over time.”
You might say.” Yeah, I know omnichannel is the future, and we at XYZ company are going omnichannel, but still, there are many problems that we are facing as far as inventory, supply chain, order and return management are concerned.”
Well, I agree that there are issues that even eCommerce giant Amazon is facing in going completely omnichannel, and when it comes to sportswear, it becomes more difficult.
But here I am not only going to talk about other companies or their problems, but I am also going to solve the issues. Read on –
The Problems that the biggest of biggest sportswear companies face in managing orders, supply chain, and Inventory while going omnichannel.
- Order management is a prominent issue with many companies since sales come from different channels. Immediate updation on the centralized Inventory is essential for an organization to go omnichannel and give freedom to the consumer to buy & return a product from wherever they want. Also, a buyer can raise an order online and schedule a pickup at the nearest retail store. Managing these types of orders is the key to go omnichannel, but this is also one of the significant issues that companies are facing.
- They need a centralized order management system that can be connected to marketplaces like Amazon, Shopify, etc.along with the retail POSes and CRMs across the world across various channels.
- Supply chain analytics and predicting demand at a retail store based thousands of miles away is the most crucial decision, especially when it is for seasonal sportswear or special edition sportswear for movies or cyclical events like the Olympics or World Cup.
- For example, according to a report in the Wall Street Journal, Adidas’ Chief Executive Kasper Rorsted said that the company didn’t have the manufacturing capacity to feed the growing demand for its mid-priced products in the US and it could cost them something in between $225 and $450 million. Now here, Adidas was looking to make an impact in the US market, but unfortunately, lack of supply chain planning they have to suffer. Had they planned and forecasted the demand with smart software, they could have met most of the market’s demand.
- Maintaining selling price uniformity over several channels is in itself a task for the sportswear companies because consumers, when it comes to sportswear, are very vigilant, and since many fraud companies try to copy their products and sell them. So, discrepancies in selling price make a buyer suspicious about the product’s authenticity. For example, Nike has been successfully able to maintain consistency in prices across channels.
- The biggest hurdle that major companies face while going omnichannel is that though they have the aim of centralizing their inventory data, they don’t get a centralized solution for the issue. They have to buy different software from the same company or different companies. Like buying Warehouse management software, order management software, shipment tracking software, prediction analytics software (like Nike), and supply chain analytics software like Columbia sportswear.
- Of course, managing Inventory, making sure that the supply chain is perfect, and the inventories across all channels are updated perpetually are crucial problems. Still, the significant challenge is the centralization of software.
- Not only this becomes costly, but also it is time-consuming and tiring. Added to that, if one software gets flawed, the other stakeholders suffer.
- If you want to go omnichannel, you need to first go for an “omnisoftware” software. It is a problem that the major companies will predominantly face in the future.
- And, in the future, in fact at present as well, you need a software that contains everything right from AI-Powered Order Management tool, shipment tracking and management tool, inventory management tool to purchase management, demand forecasting and analytics tool that measures all the KPIs from perfect order percentage to open purchase orders to product fill rate.
How will an AI-Powered “omnisoftware” software solve the problem and enable you to become an omnichannel sportswear giant smoothly?
- An AI-Powered Order management tool would offer customizable automation triggers and then as per triggers proactively confirm paid orders, create pick lists, shipping labels, invoices, tag products, create bundles, prepare manifests and even find out the shipping partner according to the shipping address. Most Importantly, the software can be connected to all types of marketplaces, retail POSes, CRMs, accounting software like QuickBooks, and 3PLs.
- Automated software would update the centralized Inventory as a sale or return is processed in any part of the world.
- Undoubtedly since the Inventory is updated instantaneously across channels, customers can order online and pick up from the store or can order in store and get it delivered at his/her place. They can also buy from one country and return in another country if they are traveling. Thus, an AI-powered Order Management Tool gives its customers the flexibility they want, while assisting the big brands to become omnichannel.
- Now because the Inventory is updated seamlessly, the supply chain management becomes easy. The AI programs deliver notifications of low stocks or surplus stocks in all the channels. It can also send emails to the suppliers or the nearest another retail of yours where you have excess Inventory to supply the products in case of low stocks. Why should only the main Inventory of a particular region send the stocks? Stocks can be reshuffled between high and low performing retails as well to make sure that the products are completely sold and transportation costs and time can be decreased.
- An automated inventory, order, and supply chain management software can generate reports like low stock reports, Inventory on hand report, product performance report, SKU mismatch report, SLA breach report, etc. across channels based on analytics.
- The most critical part is forecasting the cyclical demand for World Cups, Olympics, Special edition products, and seasonal products. The numerous customizable automation provided by the AI software also enables the brands to forecast the demand for different retail stores according to the sales generated in the past in various stores. It helps you in keeping your Inventory lean and reduce inventory costs while going Omnichannel.
- Coming to the most severe issue that a large number of companies will have to face while going omnichannel is managing different softwares like inventory/warehouse management software, order management software, supply chain analytics tool, purchase management tool, shipping management tool, product management tool, and customer management tool. Moreover, collating the data of different softwares, establishing the link and connection between softwares, and analyzing them will also become a task that will eat up your brain and time.
- Here, softwares like Orderhive an AI-powered software comes into play. The software not only provides several customized on-demand automation but also is a platform that includes order management tools, Inventory and warehouse management tools, purchase management tools, supply chain analytics tools, etc. Everything can be managed from a single platform, and hence it becomes super easy to assemble data from different software because it is a unified platform. It also generates automated reports, forecast demand, and have an eye on the KPIs across all channels.
- A perfect example of Orderhive being one consolidated platform for Inventory, order, purchase, return, and shipping management is CR7 footwears, a flagship brand of a Portugal footwear company that offers a premium range of Christiano Ronaldo’s shoes. The brand achieved perpetual inventory visibility, centralized inventory updation, accuracy in stock counts, automatic generation of multiple invoices, and on-demand customized automation. CR7 was able to perform most of the tasks by just login into one portal.
Therefore, for going omnichannel, you need an AI-Powered centralized perpetual inventory management software that has all the other essential tools under its umbrella. Just login to one portal and You are sorted for the day.