Many businesses moved from inventory management system solely maintaining records and reporting on inventory to more strategic inventory requirements to plan, project and fill customer orders and improve profitability. With all of the options available today, how do you know which solution will work best for you and your business? And what features should you be looking for?Read More >
A backorder is a customer order for a product from a retailer or supplier that cannot be shipped immediately or by the promised date. Simply stated, backorders are a temporary out of stock condition. An order is not a sale that you can take to the bank until the item is shipped or picked up at the store, the transaction is invoiced, and funds are deposited.
The rate of backorder – the percentage of order lines that cannot be shipped out of the total items ordered for the day - is an excellent measure of your inventory management and the customer service you are providing. An even better measure is the initial customer order fill rate, discussed below.
The biggest challenge you’ll face in relocating a warehouse is disruption to your business. If you are fully invested in inventory at an existing 3PL or your internal facility, how will you transfer inventory to start up the new facility without having to shut down for days or even weeks?Read More >
In operating multiple DCs, one of the major on-going costs is the additional inventory at the SKU level that will be required. Many times, companies are surprised at the magnitude of the inventory increases. Our experience is that a second DC adds 30% more overall inventory in a company, then just having a single DC. A third center may add 50% more overall inventory, then a single DC. Obviously, the increase doesn’t automatically correlate to the company being able to achieve 30% and 50% higher sales without some major marketing and promotional changes.Read More >
As Amazon’s multi-DC strategy puts pressure on multichannel merchants, having an effective inventory strategy to maximize sales, profits and customer service becomes all that more crucial. Inventory is the largest balance sheet asset in most companies. Let me give you a few examples of how other companies are focusing on inventory in their businesses.Read More >
Since inventory is the largest balance sheet asset in most companies, this is certainly a hot spot for all companies. “Systems” don't take into account the total costs of owning slow-moving inventory (occupancy, interest on the investment, distribution center labor to maintain and control it, etc.). Only management can analyze these expenses and methodically reduce them.Read More >
For national retail chains that want to grow ecommerce as omnichannel businesses, there are three elephants in the room. The first is of course the behemoth of Amazon.com, with its far-reaching tentacles. Next is the customer’s ability – and preference – to shop anytime, anywhere and from any device of their choosing.
While both are truly big challenges, the biggest elephant of all is the retailer’s own supply chain and infrastructure. More specifically, it’s their inventory management system, and the need to make inventory availability a customer-facing application (see elephant #2 above).
I’m not chiding big retail. Make no mistake – my bet is on big retail. But the magnitude of these system changes and other supply chain requirements will burden IT management and the future earnings of many companies. The problem is the first two elephants are driving the sea of change, and there can be no going back without severe sales losses.
Here are some reasons why inventory management systems and inventory availability is the biggest elephant of all:Read More >
Inventory is most likely the largest balance sheet asset in your company. How well you use inventory management techniques to plan, purchase, and manage your inventory largely determines your level of customer service and profits. But selling goods in multiple channels and titles means dealing with channel- and title-specific planning and inventory management needs.
Based on our inventory management best practices assessments with clients, we've come up with some inventory management techniques to consider when managing multichannel inventories.
Inventory is the largest balance sheet asset in your business: If your margin is 50%, that means your cost of goods is 50%. In other words, 50% of your net sales are spent on inventory and inbound freight.
So why aren't merchants more aggressive in dealing with inventory? In particular, marketers need to do more to liquidate aging inventory, and look closer at how to achieve the optimal balance point between high order fill rate and increased inventory.
Most multichannel companies have plenty of room for improvement in how they manage inventory. These 10 inventory management techniques will allow you to deal with inventory more aggressively and make more profit:Read More >
How do you evaluate your merchandise vendors? If you ask Merchandising, Operations and Accounting about vendor compliance and their performance, chances are you’ll get widely different answers. The merchandisers will consider the sales and margin and the vendor’s product development capabilities. Operations has to deal with QA and defective product problems, vendor packaging rework and late deliveries being escalated. Accounting will tell you about the vendor’s paperwork practices which are not according to your vendor compliance standards and result in chargebacks. Many companies are developing a holistic view of vendor performance through a periodic formal vendor evaluation using a vendor scorecard.Read More >