The art of retail is to delight and serve a specific consumer demographic. Managing a successful retail business is combining this art with the science of excellent business strategies and objectives.
Want to merge the art and science of retail planning to compete in this marketplace? The following 5 steps will help you become more agile and responsive to fast-changing customer trends through more effective merchandise planning, assortment, allocation and replenishment.
- Enable Collaborative, Cross-Channel Planning
Consumers are in control and have access to the channel of their choice when and where they are ready to buy. For many retailers, these channels are rarely in-sync. While the store may have a surplus of inventory, the e-commerce distribution center may have back orders and out-of-stocks. According to the 2017 Merchandise Planning Survey Benchmark Research, 64% of retailers state that better integration of merchandising and planning activities are their top business priorities. Retailers must implement a collaborative, cross channel planning platform that delivers the visibility they need to increase full-price sell-through and in-stock performance.
- Implement an Integrated Planning Platform
Retailers’ siloed approach to cross-channel planning often leads to stranded inventory. When retailers gain visibility across the enterprise they can see where demand is occurring at a granular level. This can lead to better planning and help reduce initial allocation levels by holding back inventory. Planners can then monitor demand patterns and quickly allocate inventory where it has the best chance to deliver the highest margin contribution. An integrated approach allows planners to see what the demand is by both location and channel at a moment’s notice.
- Automate Allocation and Replenishment
Allocation and replenishment can be tedious processes when managed with spreadsheets or obsolete homegrown solutions. An integrated platform drives consistency in the process and trust in the data and can automate both the push-based allocation and the pull-based replenishment. Today, leading retailers are able to confidently automate the majority of both the allocation and replenishment processes. Automation frees planners from routine repetitive tasks and the optimized work flow helps transform the allocation and replenishment planning position while developing higher skill sets and decreasing turnover. A more rapid flow of allocations to the warehouse also allows retailers to satisfy consumer demand at record pace. To hear first-hand how a fast-fashion retailer reduced its initial allocation by 20 percent watch the on-demand webcast: Groupe Dynamite: Retail Optimization.
- Improve Assortments with Better Omni-channel Planning
Consumer demands change by the minute and when retailers plan in silos they introduce inefficiency into planning, assortment and inventory. To a consumer, the online channel may be very different from the in-store channel. This creates confusion for the buyer and dilutes the brand as a whole. When planners have visibility across channels they can fashion assortments that are unique for each channel and location. This unifies the brand as a whole and provides a more pleasant experience for the consumer.
- Analyze Results to Improve Forecasting and Create Efficiencies
Planning systems must continuously analyze where demand is occurring so it can recommend the best plan for the business. An advanced planning solution enables retailers to look at multiple demand signals from the historical sales to real-time point of sale data to create the best forecast. Robust forecasting and analytics are essential in this process.
Retailers who use these five tips will be a step ahead of their competition. To become a champion retailer, you can no longer operate the way you have in the past. The future of retail is now.
Video – The Future of Retail Planning
- Retail TouchPoints: 5 Building Blocks for Retail Consumer Centric Success
- BRP: 2017 Merchandise Planning Survey Benchmark Research