Efficient inventory management involves a delicate balance of buying, selling and distribution — made more complicated by the recent closure of retail stores.
As these sales channels being to reopen, retailers must work out how best to deploy inventory in an unfamiliar environment with uncertain foot traffic.
Here, three industry experts share their advice on what steps to take right now.
Jason Becker, CEO, RICS Software
“My advice is that all retailers have a digital strategy. It’s hard to imagine retailers without a way to sell online in 2021. For those shoe dogs who don’t want to do anything digital — and there are some — they still need a way to sell online for ‘back-up purposes,’ even if they don’t prioritize e-commerce as a business strategy.
But don’t get swindled by people who want to build you a fancy e-commerce website. Start small, get results and expand from there. We’re all still learning about ‘Facebook Shops,’ but we think it’s going to be a huge opportunity, especially for those who haven’t invested in e-commerce tooling yet.”
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Ronen Lazar, CEO & Co-founder, Inturn
“Retailers should look at each business through a global lens, versus a regional approach. Look for opportunities to reallocate in-demand inventory into open stores. An ongoing investment in owned and operated e-commerce platforms can also help offload the inventory from closed stores.
When that isn’t possible, retailers may identify new sales channels such as the discount marketplace to offload what has now become excess inventory. For retailers in the off-price market, they should look to investing in e-commerce operations to help sell the inventory they aren’t able to sell in-store at the moment.”
Alexandre Therrien, Strategic Solutions Manager, Lightspeed
“The best formula for forecasting inventory needs lies not in how to buy inventory, but how to sell it. Retailers who are reopening have to do so with limited capacity, so many are turning to appointment-based models. This gives them an idea of what shoppers are looking for in advance, which helps plan inventory. While they may be seeing fewer customers, those customers are significantly increasing basket size and value because of the personalized experience.
It is no longer profitable to fill distribution centers with as much inventory as possible — retailers must be conscious that they have the right inventory. To do so, they have to get to know their purchasers on a deeper level and build inventory around their needs.”