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Inventory Visibility – Why You Need It?
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Editor’s Note: This post was originally published in November 2016 and has been updated for freshness, accuracy and comprehensiveness.
What is Inventory Visibility?
Inventory visibility is about showing your clients and company associates what you have in stock. As well as where and how to get it if your client wants it. The first step on this journey is to have the systems that know where your stock of goods are located. But it goes beyond simple inventory management at your distribution center (DC). Yes, your systems need to know about the DC inventory, but it also has to make your store inventory visible, as well as any other locations such as displays, stock rooms, at third party logistics provider (3PL), and even at the drop shipper, if you are using one.
If the Customer Doesn’t See It…Does it Really Exist?
To run an effective omnichannel business, you need to show your clients what you have and where it is. This permeates the supply chain. You need to know inventory levels at all your locations. Perhaps even more importantly, you need accurate inventory visibility and levels. After all, the whole point of omnichannel retail is to give your customers options. Inventory visibility is about showing clients where you have stock of an item at any of your locations. If a customer wants to order online and have it shipped to them, great! Alternatively, if they don’t want to pay the shipping fees, they have choices here too. They can opt to pick up their purchase directly from one of your stores (BOPIS). In this regard, real-time inventory visibility is a major play. If the customer sees that the store location near them has stock, it means they have the ability to fulfill. The benefit of inventory visibility here is that the customer may choose to drop in pick up the item directly with the cost of shipping saved and the chance for upselling.
Why is the Pick-up Important?
Pick-up (aka click and collect) gives the brick-and-mortar-centric retail industry a chance to compete effectively with online pure play companies like Amazon. An interesting side note is that many pure plays are opening their own brick-and-mortar stores. Amazon being among the most notable. Giving customers the option to pick up their goods, gives them a sense of control. It gives them instant gratification and the ability to save on shipping and handling. Don’t forget too that it is an opportunity to interact and ask questions of your associates.
It All Starts With…
Remember, that this entire journey starts with your move to improve inventory visibility. If your system cannot aggregate your entire inventory pool, as well as provide a feed to show where all the inventory resides — you have a problem. It isn’t just about inventory tracking. It’s about pooling, segmenting and getting the big picture.
A Key Delivery of Your OMS
An enterprise-level order management system (OMS) provides inventory visibility as a key function. If inventory visibility is not part of your system’s capabilities, start looking for a point solution that offers it out-of-the-box.