E-commerce has thrown open opportunities for retailers and wholesalers like never before, enabling them to facilitate 24×7 direct online selling for both B2B and B2C operations. With such ease of selling through online channels, consumers have smoother access to niche products that they wouldn’t otherwise find in brick-and-mortar stores or products that are not available in their local regions. Businesses can serve a much larger audience when they are present online, as distributors can sell their goods directly by avoiding retail costs, and maximise their potential revenues.
On one hand, e-fulfilment of consumer demands with respect to physical products has proven to be a huge opportunity for retailers and wholesalers to stay ahead of the competition. On the other, it presents certain logistical challenges for distributors and retailers who regularly sell or rent out their products through e-commerce channels, chief among which is that of inventory management.
Why businesses need real-time inventory management
“Out of Stock.” These three words have the power to destroy an e-commerce business and drive away customers permanently. Businesses which sell/lease out their products only on a wholesale basis may find it difficult to manage inventory like retailers do. A lot can go wrong if they underdeliver on their promise, especially considering that customers can immediately publish damaging remarks about a business online, which could lead to a loss of customers and revenue. This is why efficient inventory management is extremely important for any business, more so for those which sell online.
There are several aspects of sales that distributors must manage simultaneously, such as inventory as well as multiple payment channels. Managing inventory, in particular, is often quite complex for e-commerce businesses, but it’s nonetheless highly integral to the efficient delivery of services. Inventory and stock are variable factors in selling activities, which only become harder to manage as the size of the business and the demand for products grow. Hence, it becomes important to have an inventory management system in place, which allows businesses to work at their maximum capacity and keep up with tight timelines by avoiding stock-outs and ensuring that shipments run smoothly.
This is where real-time inventory management can play a critical role in keeping customers happy and ensuring that they stay loyal to your business. An item should be debited from the stock as soon as it is sold, and similarly, new items must be updated in the list of inventories as soon as they are procured and fit to be shipped. Besides ensuring accurate and prompt coordination of stock levels with the front-end systems, real-time inventory management also helps in tracking the inventory from the moment it enters the stock and is shipped till the very minute it reaches the customer.
Unique barcodes, Radio Frequency Identification (RFID) tags, or Quick Response (QR) codes linked to automated inventory management systems are the most effective tools for this, as they allow distributors to scan each product when it enters the stock and make its status visible on the system at all times.
Companies catering to the renting and sharing economy have an even greater need to ensure that their inventory is as efficiently managed as possible because the stock gets replenished only when products are returned, not bought. An item should be re-entered into stock as soon as it is returned, and the process of cleaning and re-packaging completed before it is made available to customers once again.
Analysis of inventory and stock levels in real time through an automated system makes it easier for sellers to pin down specific periods during a month, a year, or even at an exact time in the day when the demand for a product is high. Thus, with such a system in place, businesses can schedule the procurement of products and avoid stock-out situations as well as excessive inventory. For example, an online retailer can prepare for seasonal spikes in demand for products based on the data collected and analysed, thereby helping them optimise sales and marketing campaigns for these periods.
Real-time inventory analysis is also particularly helpful in identifying problem areas within the supply chain where delays occur, and why. Distributors can accordingly take the right measures to solve these issues and ensure a smooth shipping process. Real-time inventory management also plays a crucial role in customer satisfaction. Not only does it help avoid errors in processing orders, but also provides customers with transparent information on product availability to help make their purchase decision simpler.
The time is now, for real-time workflow optimisation
Inventory management systems and real-time data creation and analysis solutions are the most efficient way in which e-commerce businesses can optimise workflows and supply chain processes. Such a level of optimisation as offered by new-age technologies also provide businesses with a significant edge in a hypercompetitive e-commerce market such as India. Investing in such efficient systems will ultimately pay off for the business by offering benefits such as efficient savings, better customer satisfaction, and improved sales processes.
Anubha Verma is the Chief Technology Officer of RentSher, a leading online product rental marketplace.