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3 Keys To Improving Omni-Channel Fulfillment With A Streamlined Inventory Process

Worker with tablet in warehouse

At the root of an effective omni-channel operation — seamless service across multiple shopping channels — is an efficient inventory process.

It makes sense. Modern consumers want flexibility to buy, order, reserve and pick up purchases through any means necessary. That’s why retailers must take a streamlined approach to manage increasingly complex fulfillment processes.

Companies can get help from a retail management system that coordinates accounting, distribution, purchasing, inventory and sales order processing. 

Sales order processing is a standard procedure in the manufacturing and distribution world. It has sequential steps to process an order. For example, a vendor sends an invoice to the retailer after delivering the inventory.

However, in a typical retail environment, a sales transaction happens all at once: A customer picks the item off the shelf, pays for it at the retail point of sale and leaves the store with their purchases.

Fulfilling customer orders in an omni-channel may lead to retailers needing to create processes similar to traditional distribution inventory fulfillment processes. Retail management software integrates these various processes, creating a streamlined process in three key areas.

  1. Seamless order picking: In the distribution world, order picking means getting the item from the warehouse, packing it in a box and shipping it out. However, in omni-channel retailing, the timing of order picking varies according to the customer fulfillment process.

    For example, some retailers have a manual process for taking care of special orders or e-commerce transactions, mostly because these types of sales have been of a lower volume.  Assuming that a move to omni-channel will not only increase the volume of these types of order and may create new process challenges for retailers in providing services — such as order online, pick-up at store, buy at store, ship to customer, etc. — retailers would be advised to look to automation to assist in executing these transactions.

    In a customer pickup scenario, retail management software tracks where the inventory is in stock and when it transfers to and arrives at the pickup store location. The store associate can see in the retail POS software system if the order is ready for pickup. When the customer comes into the store, the customer pays for the item at the retail POS, thus finalizing the picking, shipping and invoicing process. Or if the customer paid for the item online, the order is finalized after the customer picks up the item in the store.

  2. Smooth inventory reservation system: The integration of the retail store, retail POS and back-end systems are vital to inventory management in an omni-channel world. Let’s say you have 10 items in stock, but you receive a sales order for five of those items. That customer may want the order right away or may want it to arrive in 30 or 60 days.

    Regardless of when the customer wants the item, your retail management software solution should reserve inventory for the customer’s order. Having a process to reserve inventory is critical for future order processing as well as knowing what stock is available to sell to new customers or transfer from a central warehouse to the stores.

    So when you look at how many of a certain item you have in stock, your retail management system will show you have 10 items, but five of them are on reserve, marking only five available. Your system can give an estimated delivery date for immediate orders or an estimated shipping date for preordered items.

  3. Managing special orders: In retail, a special order means an order that is not immediately available in the store or requires a special effort for the retailer to fulfill.

    Think of it like this: You received an order for five TVs, but you don’t have any TVs in stock. You have to order the TVs from the vendor before you can fulfill the customer’s order.

    Then the customer selects at-home delivery instead of in-store pickup. If the customer paid for the item in full, the purchase turns into a sales order like a distributor sales order. In each case, the special order process is best managed by an integration of back-end systems.

    However, although much of the inventory process can be managed through a retail management system, human intervention is still part of the process. Someone needs to physically separate the items from the warehouse or the store shelf and designate the items as part of a customer’s order.

Managing inventory in an omni-channel retail world takes an integration of multiple back-end processes, such as sales orders, pickups, shipping, invoicing and the POS system. Retailers should take these factors into consideration when selecting a retail management system that supports omni-channel customer fulfillment.