Quite a few aspects of the global telecoms sector have a degree of novelty about them and can be stimulating but one that doesn’t really cut the mustard in the excitement stakes is inventory efficiency in a bricks and mortar store. See, you’re probably glazing over already.
However, while the subject isn’t exactly a gut-grabber, the fact is that if physical retail outlets are truly to transform their operational efficiency in the age of Amazon and its e-commerce ilk, (which is what all of them claim they want to do) they are going to have to perfect the art of maintaining something like 99.99 per cent inventory accuracy.
It’s straightforward really, stores that don’t know exactly where individual items of stock are located and how many there are of them won’t be able to serve their customers properly, nor will they be able to carry through what, in the trade, is referred as “competitive omnichannel retail strategy.” What this really means is a multichannel approach to sales that seeks to provide the customer with a seamless shopping experience whether that customer is shopping online from a desktop or mobile device, by telephone or is physically wandering the aisles of a brick-and-mortar store.
It is a fact of life that for retailers still using traditional inventory counting methods in sectors such as fashion and soft goods, inventory accuracy can, and frequently does, fall to 65 per cent. And if a shop doesn’t know where 35 per cent of it’s stock is, the shopping experience for the customer is going to be dismal and that means disappointed punters and lost sales.
There is a solution. It includes a resurgent RFID sector and the arrival of a new boy in the shop, AI. RFID use in retail fashion can quickly provide greatly increased ROI. ABI Research reckons that a clothing store with a turnover of about US$6 million can realistically achieve a 44 per cent ROI within the first year, and that returns will continue to rise from there to reach over 200 per cent in year three.
Then there’s the huge number of shelf-based shops personified by grocery stores and supermarkets. It is commonplace in those environments for shop workers to spend 20 hours of a 40 hour working week simply counting stock. It’s crazy and unsustainable. Automated inventory process will save enormous sums in terms of labour costs whilst driving sales and improving the customer experience. It’s the only way to go.