Achieving a Clear View into Retail Channels – The Omnichannel Path to Success
The apparel and consumer goods landscape has changed drastically over the last five years and is continually evolving primarily due to the most important business factor for any retailer, merchandiser or member of the industry – the customer. Consumer buying preferences have shifted with the introduction of new technologies; retailers and suppliers have to keep up in order to maintain and grow their customer pool while ensuring accurate delivery of top-of-the-line products. To address consumer demands, organizations throughout the retail industry have been expanding their purchasing channels, or “omnis,” from brick and mortar stores to online shopping, eCommerce and buying apps. And those that haven’t, soon will be. In fact, Forrester Research forecasts that 60 percent of all retail sales will involve the Internet by 2017.
As the number of retail purchasing channels grows, executives are met with the challenge of maintaining visibility over them all while ensuring dynamic, seamless fulfillment. To achieve true integration and visibility of each omni, some organizations have been turning to and experimenting with omnichannel planning and fulfillment solutions. And as these solutions continue to make their way onto the retail scene, executives are asking: What should I look for, what are the true benefits and what constitutes success?
What Should You be Looking for?
When organizations choose to take the omnichannel approach, outlining business objectives and identifying the right solution are key, and there are several factors to look for. First, executives need to evaluate what areas of business should be merged, including purchasing channels and different stages in the product development chain. Outlining these operational objectives can be the biggest hurdle in the omnichannel process. Oftentimes, organizations that have grown via acquisition are operating on independent channels of siloed technology, creating the need for a complex evaluation of what systems are in place.
Next, the organization should begin looking into a solution that best fits its needs. The solution should be able to manage key components of any supply chain from end-to-end, including merchandise planning, forecasting, brand management and inventory controls. With the ever-changing retail landscape, organizations also need to ensure that solutions are robust, flexible and scalable. These characteristics can play the most critical role; when the next purchasing channel comes along, you don’t want your solution to become outdated and obsolete. And as your company expands its reach, you want to ensure your solution is capable of keeping up with the rapid growth.
Omnichannel solutions should also offer real-time visibility with a unified view of inventory at every store and distribution center globally, as well as the supply chain. To achieve this, organizations should seek a suite of solutions that offers an end-to-end approach and single source of inventory per product to which all channels have real-time access. Executives should also determine rules-based sharing for their omnichannel process. These rules may include: How will the different omnis share fulfillment, inventory and financials? What retail customer is the biggest priority – is it an outlet store, single retailer or department store? To tackle these challenges, many organizations are turning to supply chain strategists to ensure clear business decisions are made and achieved with new omnichannel solutions.
With a comprehensive view of demand and inventory, organizations can make the right business decisions when it comes to purchasing plans and product sales timelines. Visibility should also include insight into work-in-process status of partners, as well as a view into product development and sourcing so that changes to products can be made seamlessly.
Omnichannel and Optimized Operations
Whether contemplating the way customers shop or how retailers make their wholesale purchases, the end goal is the same: A seamless experience for the consumer across purchasing channels, anytime and anywhere. As detailed above, omnichannel retailing introduces a way for brands to achieve this seamlessness by keeping a pulse on each stage of operations as items go from a simple design idea to the customer’s hands.
For many apparel and consumer goods organizations, roadblocks surrounding system synchronization lie in their path. For example, if organizations use different technologies for their supply chain, distribution and fulfillment, or eCommerce and wholesale rely on siloed solutions, they can be plagued with miscommunicating systems. This miscommunication can lead to incorrect shipments, false information and, in the end, unsuccessful product fulfillments and disappointed customers.
One such example of where system miscommunication between omnis may occur is with ship-from-store scenarios, where customers either order products online and pick them up in-store or have them shipped. A recent report by L2, a digital marketing think tank, found that about 51 percent of retailers reported not being able to fulfill in-store pickup of orders because of inaccurate store inventory.
By not fulfilling customers’ or wholesalers’ orders in an expected timeframe with products up to their standards, issues with the user experience may arise, leaving individuals, shop owners or executives to rethink where they make their next purchase. With the goal of improving strategic decision-making and meeting today’s consumer expectations, retail organizations and manufacturers are turning to omnichannel solutions for system integration and real-time visibility. This holistic view ensures organizations are delivering the right products at the right time and at the right price, utilizing one system to unite all purchasing channels.
With the implementation of an omnichannel platform, retailers and merchandisers alike can achieve many interconnected benefits. These benefits include expanded visibility and integration, increased understanding of consumer demand, seamless fulfillment and the ability to plan and develop product mix. Omnichannel platforms also give retailers the knowledge to improve strategic decision making to meet consumer expectations with a seamless experience and product quality.
Real Examples with Real Results
While omnichannel solutions are still a developing trend in the industry, we are seeing many organizations take the lead in implementing the technology. One such company is Aerosoles, a leading ladies’ footwear business that relies on multiple sales channels to reach their customers. To meet consumer expectations and fulfillment demand across wholesale, Internet, retail and direct channels, Aerosoles implemented omnichannel technology. With the technology in place, the organization is also able to maintain organizational efficiencies during increased purchase periods from eCommerce and online sales. Other benefits come from reductions in time spent manually tracking inventory on hand, faster inventory turns and a more accurate understanding of overall inventory costs.
What’s Next for Omnichannel?
As the consumer and lifestyle product market evolves and grows, so will the expectations of consumers – and, thus, the demand for omnichannel solutions. Consumers – from wholesale buyers to the everyday shopper – are coming to expect order accuracy, quicker production times and more product innovation. And, with so much at stake and so much to gain from omnichannel, now is the time for organizations to adopt these flexible solutions to maximize business success.
About the Author:
Jason Roth is vice president, applications for CGS, leading the design and development of application solutions for BlueCherry® Enterprise Solutions. With more than 30 years in the fashion and footwear industry, he has experience in operations, customer service and production. For the past two decades he has been designing and implementing solutions for the fashion industry.
Other Articles You May Enjoy:
Follow Us On Facebook – https://www.facebook.com/ThePOSNews