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Smart Merchandising

Manage inventory transfers efficiently for your growing business

What is (Inter-Store Transfer) IST?

The inter-store transfer also referred to as Inter Branch Transfer, is part of the retail supply chain management where the inventory is transferred between different store locations belonging to the same retailer. It is usually carried out for a single, or few items, to meet specific customers’ needs or for inventory consolidation to ensure optimal availability, better exposure of inventory, and subsequent improvement in sales.

 Why is it necessary?

Merchandisers allocate fresh inventory at the start of the season based on the initial demand forecasts. However, as the season approaches, the actual store performance may change leading to understocking or overstocking scenarios. Therefore, the reshuffling of in-season inventory between stores becomes critical.

When it needs to be done?

Inter Store Transfer is generally done in the season before the end of the Full price period to improve the availability of inventory by moving it between stores. Retail merchandisers prefer to achieve a higher sell-through on the inventory before it needs to be liquidated or discounted for clearance.

In situations where excess stock is present in stores with low demand, or when the fresh inventory is leaner in terms of width and depth in stores with higher demand, inter-store transfers help in improving stock availability. It helps correct the allocations done during the pre-planning period.

How Increff Merchandising Solution performs IST?

Step 1

Liquidation cleanup of data

The input sales data is cleaned for spikes or dips experienced during liquidation events. Such events tend to distort the actual demand and compel customers to purchase due to low price points. This cleanup is done for each store-brand category and the max revenue that can be cleaned in the process is used as the input. If there are no such sales, i.e., all the sales are at similar discounts, then there is no cleanup.

Step 2

Topsellers identified at Region – Brand – Category level

Step 3

Store Style Ranking

Used to determine the performance of a style in the stores that belong to the same region. This is a very important factor in IST since it determines the movement of the inventory of a style from the least-performing stores to the better-performing stores.

The differentiator in store-style ranking – Usually top styles are allocated to top stores, however, top styles may not perform well in the top stores. Merchandising Solution has a matrix approach to see which style performs in which store, rather than blindly moving top style to top stores.

Step 4

Outwarding and Inwarding of stocks

Maintaining key size availability in stores, the top stores will receive pieces as per the demand. Outwarding and inwarding is done based on the ranking of the style in that particular store. The downloadable report showing source and destination stores is available for direct implementation.

Health Correction

A healthy size set where key sizes are present is maintained. If the store-style rank is low, the stock is outwarded to consolidate at a higher-ranking store. Hence the leftover pieces from cut sizes/extreme sizes get more visibility as well.

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Smart Merchandising Technology

Unlock the power of analytics to win more online sales opportunities

As retail e-commerce sales worldwide are expected to grow by 56 percent over the next years, reaching about 8.1 trillion dollars by 2026, retailers cannot ignore the enormous potential of an online presence. But getting into each customer’s shoes to map their journey, understand their needs, and fulfill their demands can be quite challenging.

Arm your online sales data with analytics capabilities that can help you turn raw sales data into actionable insights to facilitate quick and informed decision-making, thus helping them offer the right products at the right time for sales maximization.

Here’s how Increff Online Analytics can make this happen

Connect with us now. Sign up for free HERE.

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Smart Merchandising Technology

Planning a sustainable future with Increff Merchandising Solution

Apparel companies, be they haute couture or mass-production chains, are at all times burdened with an inventory glut. This glut eventually results in deadstock that generates 53 million tonnes of litter for landfills each year in addition to the environmental consequences of the production of the garment itself. Approximately 30% of the clothing produced each season is never sold. As much alarming as these figures look, it is expected to further lift and increase to a blaring 150 million tons by the year 2030.

The crux of the matter is how we tackle this issue effectively and efficiently from the roots. It is at this stage that we shed light on the importance of accurate planning, and how an easy tool can help merchandisers optimize this process. Introducing Increff Merchandising Software

By analyzing and studying past sales, revenue, discounts, size cuts, and stock-outs, Increff Merchandising Software helps determine the ideal assortment mix at a granular level. It enables merchandisers to optimize the inventory at a store-style level and produce accurate data reports that act as a foundation to study sales trends from past seasons and focus on consumer trends and bestsellers. Clients can bet on their best performers and reduce overstocking substantially by redefining the sales pattern with better clarity.

Better planning and distribution have made a difference of up to 25% less inventory holding among users of Increff Merchandising Software.

Inter-store transfers also help to move the stock around and increase sell-through. Here the available stock among stores in a region is moved to a store where it has better performance potential. This will give the styles one last chance to perform before they go into discounting and sales. Increasing the visibility of styles also gives the last chance to rectify mistakes made in planning and selling the purchased stock.

The mammoth task of ensuring a sustainable future in its true essence only requires discipline and structure that we at Increff help merchandisers achieve via our Planning module. The industry has been guilt-ridden due to its major contribution to damaging the environment and we must approach the future cautiously. Let’s use intelligence in playing our part judiciously in this journey by using smart analytical tools to build a sustainable and resilient future.

Check how Increff smart technology solutions can help you walk on the path toward sustainable retailing. (LINK HERE).

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Smart Merchandising Technology

Dive into your sales data and interpret the right story

Retail is one of the most data-driven industries, from sales data to inventory details – every data point offers an opportunity to make your retail business more efficient and successful. The right data at the right time can help you understand customer behavior, estimate demand requirements, build forecasts, and make informed decisions.

Here’s how the Increff Business Intelligence module can help you turn raw sales data into actionable insights and facilitate quick and informed decision-making.

Connect with us for more details

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Smart Merchandising

Are your Business Decisions Hurting your Bottomline? It’s Time to Rethink.

Offering excessive discounts during the sales season can be quite tempting to clear ageing inventory, however, discounts not only slash profit margins significantly but, if done without the right strategy, can impact your brand image. Once customers get used to low price points, they can become reluctant to buy at full price and end up waiting for the clearance sale to make their purchase. This behaviour impacts regular cash flow, and brand reputation, and dilutes customer trust in the genuineness of the price. 

A good pricing model paired with an effective discounting strategy helps maximize business growth and promote sales without hurting the business. Here are some discounting techniques to make your business more profitable.

  1. Flat discounting vs Slab discounting

Applying a flat/blanket discount on all products can shoot up discount payout dramatically, affecting profit margin by treating them all the same. Rather than offering flat discounts, brands can give higher discounts on selected assortments, e.g. seasonal items or refurbished items, and earn higher margins on good inventory. This kind of slab discounting helps brands earn better margins by discounting the products right based on their true value. Increff Merchandising solution is designed for flexible discounting, it allows retailers to adjust prices on a daily basis, based on fluctuating customer demands. 

  1. Gift-with-purchase (GWP) & Purchase-with-purchase (PWP)

Offering a free gift with purchase is an effective cross-selling strategy that helps customers get excited at the prospect of saving money and getting a higher value for a bundle of products. Offering customers an option, e.g. “buy two, get one free”, can be a smart way to reduce discount pay-out and clear more stock. Another sales promotion technique, PWP, offer discounts only on the purchase of a second or third product. This is to entice customers into buying a threshold of products to avail of the offer. 

Both strategies ensure that products are not devalued or the brand reputation is not diluted. However, if the discount is not well planned and executed, there is a high risk of giving away expensive stock which could cause serious losses to the brand.

  1. Right marketing strategy during discounts

Expiry dates and limits on discounts help build a sense of urgency that urges customers to make the purchase before meeting the deadline. It’s difficult to ignore compelling CTAs, or calls to action. Statements like ‘Exclusive offer to the first 30’ or ‘Get it NOW before it’s GONE’, are persuasive strategies to raise a sense of scarcity that pushes customers to take immediate action.  

Right visual merchandising

Attractive store-front and catchy window installations, in-store displays, racks, eloquent signage, point-of-purchase displays, etc. can be good techniques to attract customers. Once inside the store, eye-catching story displays, appropriate lighting, attractive interior designs, easy-to-navigate store layouts, etc. help create a delightful, customer-friendly environment. Increff Merchandising solution considers business constraints of planogram and operating plan to design a store plan. A well-planned store encourages customers to spend more time in it, thus exposing them to maximum merchandise and boosting chances of sales. 

  1. Spread out the discount period

To accommodate the rush and avoid system glitches, it’s best to spread out the discounting period. Brands often struggle with a sudden spurt in customer footfall due to a lack of floor space, staff, or the right technology. The same is true for online shopping where a sudden spike in web traffic can cause server issues, or create bottlenecks in the supply chain. Rather than offering discount sales for one or two days, it is highly recommended to extend the period to a week or more and avoid operational nightmares. Integrating a robust technology solution for inventory and order management can help brands avoid order cancellations, delays in order fulfillment, and poor customer shopping experience.  

  1. Reward loyal customers

Instead of offering the same discounts to existing customers, it is far better to personalize offers and add value for loyal customers. They are the business builders: they buy more, pay premium prices, and bring in new customers through referrals. Realizing the benefits of loyalty requires an admission that not all customers are equal. In order to maximize loyalty and profitability, a company must give its best value to its best customers. Offering gift coupons, discount vouchers, and loyalty points to buy groceries or other fast-moving products from a partner brand, or getting a healthy discount on frequently purchased products like milk, vegetables, and cereals can encourage customers to buy more.

  1. Offer discounts to first-time buyers

Customer acquisition can be a formidable challenge. Apart from offering rewards and offers to loyal customers, it is beneficial to prioritize first-time buyers. By taking them through the rabbit hole of your offerings, brands can encourage first-time buyers to try new products. This strategy has successfully been used by fashion brands such as H&M and Bloomingdale’s in the form of offering 10% off on the first order. 

  1. Track your promotions

Track your marketing campaigns to know how effective they are. Online Analytics module in Increff Merchandising solution helps you understand the changes in page views and conversion rates, through which you can understand how effective promotions were. You could take appropriate calls to retain, increase or discontinue the offers on the products.

  1. Do smart buying

If your core idea of discounting is to get rid of excess inventory and make space, do smart buying in the first place and avoid the clutter of excess inventory. Increff tool helps you create efficient buying and reordering plans that will let you keep the optimum level of inventory. With this, you will also suffer fewer stock-outs and sale losses connected to the same.

Final thoughts

When creating a discounting strategy, avoid having a one-track mind. Instead, mix and match your options and use ample creativity to boost sales, reduce pay-outs and enhance the customer experience. Make discounting decisions 2 times faster with Increff Merchandising solution, Markdown optimization module, and sell more at the right price. 

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Smart Merchandising

Optimize inventory distribution this holiday season with Increff MS Pro

As an established brand/retailer with a healthy spread of brick-and-mortar stores, in-season planning involves optimal inventory distribution to all points of sales. In-season planning can be categorized into, new season allocation, at the launch of the season, and mid-season replenishments and replacements. Planning involves budget allocation, trend analysis, past sales analysis, etc, which gets half of the job done, but the incorrect distribution leads to a failed season.

There are a lot of factors like store capacity, variety of options, depth of the style/SKU, grade of the store, assortment mix, etc. that are involved in optimally distributing the available stock across multiple points of sales (PoS). Incorrect allocation leads to overstocking, understocking, and loss of potential sales which affects the top and bottom line.

After the new season allocation, the inventory has to be replenished based on the current sales trends to keep the sales momentum going. The health of merchandise and identifying the right stock for the right store are major factors that have to be considered during the mid-season.

Since the whole process involves a lot of resources, time, and accuracy, new-age solutions like Increff Merchandising Solution can automate the process by reducing the number of resources required, the time taken for completing the process, and increasing the accuracy.

USPs

  • Attribute Group-based new style allocation: Existing styles can be allocated based on their historic performance at the stores, which is not straightforward for the new styles that don’t have any sales history. MS Pro uses attribute group performance for new style allocation.
  • Style-Store Ranking: Placing the right inventory at the right PoS is very important in catering to customer demand. MS Pro uses style-store ranking based on the historical performance of the style at the store and allocates the inventory to the best store followed by the second best, and so on.
  • Maintaining inventory health: Inventory health plays a major role in the Rate of Sale (RoS). It is observed that the styles that don’t have important sizes available at PoS are unlikely to sell. MS Pro maintains inventory health by identifying the key sizes of a style during distribution.
  • Individual PoS analysis: Every PoS, both online and offline, has a unique customer base and the behavior of the different points of sales is different. Grouping the PoS in clusters and analyzing clusters is not as effective. MS Pro considers each store to have an individual identity and defines the right assortment and key sizes based on past performance in that store for optimal inventory allocation.
  • Maintaining fill rates at stores: Fill rate is the maximum inventory that can be stocked in a store. MS Pro maintains optimal fill rates at the store by using the planogram as a constraint.
  • Seasonality-based assortment: Seasonality is an important concept in retail, especially in fashion as certain products have demand during a certain period. Eg., Jackets, sweaters, and other winterwear apparel are sold mainly during winters and have low demand during other seasons. MS Pro helps define the assortment plan based on the ongoing season.
  • Rollup-based allocation: The allocation of the inventory is done at different levels when the right amount of data points is not available at any level. Eg., for any style, the data at store-AG is not available, a few rollups are done at the store-category level or store-category-subcategory level, and allocations are done at that level.

 Impacts Delivered

  • 13% increase in-season full-price sell-through for one of the largest celebrity brands
  • 25% revenue growth and 4% improvement in margin for one of the largest lingerie brand
  • 13% reduction in inventory brokenness, for a leading formal wear brand
  • Reduction in inventory holding from >120 days to 80 days for a leading lingerie brand
  • 90% reduction in stock allocation & buying process for all the brands
  • 13% improvement in stock health season on season, though regular replenishments and allocations for a leading formal wear brand 
  • 45% additional sales from the same set of styles with 34% reduction in brokenness through Inter Store transfers for a Global Men’s Casual-wear Brand
  • ~21.5% reduction in inventory quantity for a targeted increase in revenue by 17.3% for one of the largest health and beauty marketplace 
Categories
Smart Merchandising

Recover from post-pandemic data & sales loss with smart merchandising

The Economist, in 2017, referred to data as “new oil”, the one ingredient every business needs to drive the world ahead. Covid, classified as a “black swan” event, shook the entire social and economic status quo, and further emphasized the importance of intelligent data analysis and smart decision-making. Brands and retailers had to take a fresh look at strategy and planning. Digital sales channels took precedence over offline stores enabling brands to take an omnichannel approach. Planning an efficient supply chain, to get the right product at the right time to the right person, became imperative.

Data analytics helps make strategic business calls and design processes, thus building supply chain efficiency, and fostering innovations. Businesses need to rely on data analytics to make quick business decisions in weeks, rather than months. 

Increff smart Merchandising Solution – MS-Pro and MS-enterprise, is making strides in data analytics as diverse data is processed by patented algorithms to produce downloadable reports that can be visualized in UI.

  • Descriptive data analysis is provided through Business Intelligence dashboards. Here, dynamic performance analysis can be done with visualization techniques over historical data.
  • Predictive analytics is used to identify past sales, revenue, discounting, sell-through, and other factors from past data to predict future behavior.

It helps in accurate demand planning and distribution to ensure the right products reach the right customers at the right time. A 10-20% improvement in demand forecasting can reduce 5% of the inventory cost, which as per McKinsey and Company, contributes to up to a 2% to 3% increase in revenue.

The pandemic influenced how people perceived and purchased products which were reflected in the drastic switch in brands with fluctuating demands. This dynamism was important to capture with data analytic tools so brands can identify buying patterns and capitalize on them.

Increff smart merchandising solution is designed to adapt and grow with the changes in the market.

  • Results can be produced season-wise or period-wise depending on the purchasing and distribution pattern of the brand or retailer. It occupies budget crunches or expansions and optimizes accordingly. 
  • Dynamic data-churning help cut down the length of production cycles and adapt to quick changes in the market.
  • It gives the option to pick and choose an analysis period where a considerable amount of data is available. Data gaps can be identified while analyzing the data from similar seasons or sales periods that can be used to replace them.
  • Ability to measure a set of attributes to track the performance of particular products and forecast demands accurately. This can be derived from the few basic sets of data, available with all brands. From here the tool can churn out right from planning to distribution to online analytics.
  • The UI is clutter free and designed to create easy access for everyone. Easy usage cuts down man hours to a few minutes and enables the team to have maximum flexibility.
  • Tools account for spikes and ridges in sales and smooth out any irregularity, thus making the results more accurate and avoiding false positives due to any season-end sales or extreme dips due to temporary shutdowns.
  • Modules such as regional utilization and Inter-store transfer help to cut down on logistic time-cost and increase efficiency in supply chains. This would help your business stay afloat even in sudden supply chain disruptions. Tuning Inter-store transfer with the tool will eliminate human delays as well.

Intelligent Increff Merchandising Solution helps retailers put their best foot forward when it comes to planning inventory and allocation. The adaptable and dynamic nature of the tool helps brands cope with the natural data loss, similar to what happened due to business shutdowns during the pandemic, and take calculated decisions for steady business growth.

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Smart Merchandising

4 Myths on Store Sales Maximization

As the marketplace becomes increasingly competitive by the day, store managers are dealing with a tremendous amount of pressure to maximize sales, meet targets and boost profitability. In the last couple of years, the conditions created mainly by the pandemic have only added to that pressure and compelled brands to explore new options and innovative practices. 

But these have also given an impetus to a lot of myths surrounding supply chain management, four of which we are going to bust in this blog. So let’s get started!

Myth 1: Keep 100% inventory in stock to fulfill any order that may come

This could be one of the most tempting ways to ensure no sales opportunities are lost, and customer satisfaction is maintained at the highest possible levels. But having all your inventory in stock will raise your carrying costs sharply and may also result in a lot of stockpiles. 

The way forward instead is “rightsizing” your in-stock inventory and leveraging the services of your trusted suppliers for delivering on time. The future of profitable supply chains in fact lies in how well you are able to balance between in-store and Just-In-Time (JIT) inventory.

By building shorter supply chains, you can make your business continuity plans more robust and avoid disruptions that are typical of long and winding supply chains. Another crucial factor is your ability to integrate and coordinate with local and last-mile partners. These not only understand the immediate customer cluster better but also make a lot more logistical sense for your brand.

Myth 2: Calculation in Excel is easy. The new-age merchandising tool can be complex & time-consuming

Well, this statement is highly illustrative of your inertia to grow and evolve as a brand! Excel is great for storing and manipulating data and generating forecast reports. But it is a generic tool that will seem too primitive for the growing challenges of today’s marketplace that demands automation, specialization, and speed.

New-age merchandising tools may appear rather formidable or complex. But in reality, these are exactly the opposite. The great thing is, that these do not work on a rip-and-replace model and can easily be accommodated into your pre-existing systems. These are highly adaptable and operable as plug-and-play solutions. 

Myth 3: Discounting will increase sales & help earn more

Discounting could be a good short-term ploy to get the aging stock off your shelves and make room for fresh products. But using it indiscriminately could be rather counterintuitive and harm the stature of your brand in the long run. More immediately, it will reduce your margins and have serious implications for the overall profitability of your products.

What you really need, is to be able to use discounts in combination with data-based insights, from new-age merchandising solutions like Increff Markdown Optimization. These help you figure out what percentage of discount to use at what time and which store locations, so as to boost sales while maintaining healthy profit margins.

Myth 4: Forecasting the right width and depth is sufficient to improve inventory turnover

For starters, forecasting can give brands a foundational idea about the expected sales and demand patterns for the upcoming season. But in a fast-changing marketplace, a lot of in-season changes could upset even the most elaborately designed plans. 

For instance, fashion brands being highly influenced by cultural dynamics could suddenly experience a spurt in demand for a certain style, after a movie release. Likewise, a supply chain shock due to strikes, conflicts, or calamities could put significant pressure on some parts of your supply chain network.

Dealing with these dynamic market conditions in highly disruptive times requires you to think on your feet, rather than putting your supply chain on auto-pilot mode. New-age merchandising solutions allow you to do exactly that, by giving you insights into in-season changes in demand. Responding to these changes using inter-store or inter-warehouse transfers can be highly effective when backed by real-time data from across your network.

To sum up!

Sales maximization is obviously the most sought-after goal for every brand. But in the hoard to achieve their targets, brands could often fall for unfounded myths and unproven strategies that could hamper their growth or cause serious damage to their reputation. To keep evolving in the face of fresh challenges, formidable competitors, and volatile market conditions, brands need to keep an eye out for the latest technologies, cutting-edge processes, and robust strategies. 

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Business Smart Merchandising

5 Ways to Control Inventory in the World of Lean Retailing

The fast-changing retail industry is increasingly adopting a customer-centric approach. Customers have a wider array of options and are no longer willing to buy whatever brands offer them on a platter. In the past, retailers used to purchase merchandise based on their gut instinct or mere hunches. But today, staying relevant in the market calls for a scientific and data-driven approach. 

The growing dynamism of customer preferences also means that brands can no longer pile up stocks indiscriminately in their warehouses, as this could lead to wastage and obsolescence. This is where lean retailing comes in!

Lean retailing is all about ‘rightsizing’ your inventory and maintaining a minimal stock while relying more on the JIT deliveries as and when a product style is demanded. Lean retailing is a highly data-centric and customer-oriented supply chain practice and calls for strong supplier relationships and seamless communications. It enables businesses to cut down on unnecessary carrying costs and avoid the innumerable risks of overstock.

In this blog, we take a look at 5 simple methods you can adopt to make lean retailing a roaring success.

Regular replenishment of stock

To ensure reducing your in-stock inventory doesn’t impact your day-to-day sales, it is necessary that you replenish your stores and warehouses regularly. Optimum replenishment of stock aims at keeping your inventory costs low, while still being able to meet customer demands on time.

The optimum rate of replenishment is determined based on the data related to customer demand and preferences, and also the physical storage available with the brand. These can be factored in using inventory management software which can help brands arrive at the optimum reordering levels and also the timings of stock replenishment.

Redistribution of stock with inter-store transfers

A pre-season forecast of demand is necessary and can provide a fair idea of the customer behavior patterns over the longer time horizon. But developments during the season can also impact the trends and thus brands need a more proactive approach to ensure no sales are lost. For such contingencies, inter-store transfers are a great way out.

The inter-store transfer allows easy circulation of stock from areas of low demand to those of high demand. It is very effective in improving the health of your inventory, reducing stock brokenness, and supporting omnichannel distribution.

Suggest pullbacks for dead/slow-moving inventory

Slow-moving inventory doesn’t just occupy space on your shelves, it also prevents better-performing products to be exposed to the market. Besides, the longer your products lie on your shelves, the greater are the chances of damage, eventually making them completely unsuited for sale. 

It is necessary therefore that you identify your slow-moving stock early by tracking your inventory regularly. After zeroing in on the slow-movers, pull them back either into the warehouse or transfer them to another store if there is a likelihood of better conversions.

Expose offline inventory to online sales channels

Omnichannel commerce is fast emerging as the most disruptive trend in retail, and the lines between offline and online sales channels are blurring fast. Exposing offline products otherwise lying in your physical stores can enhance their conversion manifolds and boost sales.

With automation-based solutions like Increff Offline to Online (O2O) solution, brands can get a single view of 100% of their inventory across the board through a simple UI. As soon as an order is received, fulfillment can be done from the store or warehouse closest to the customer, thus saving significantly on logistical costs and dramatically speeding up the delivery. O2O can however be made possible only by having complete transparency and traceability of the entire inventory.

Faster re-commerce to avoid stockpiles

As brands expand their presence and achieve greater sales levels, returns can also grow proportionately. Handling returns efficiently with automated solutions is necessary to ensure the quick resale of the products. 

Increff WMS allows brands to sort the returned products on the basis of their condition. Subsequently, the items can be resold through your own sales channels, or redirected to secondary markets as second-hand products.

Faster re-commerce prevents damage due to delays and prolonged transportation, and thus loss of value. This helps optimize the resale value of the returned goods and avoids stockpiling low-value items in the inventory.

Maintaining a lean inventory is the way forward when it comes to building streamlined supply chains to meet the needs of an intensely competitive, dynamic, and customer-centric marketplace. Lean retailing however comes with its own set of challenges, most of which can be mitigated with some proactive planning and smart tactical decision-making.

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Business Smart Merchandising

Inter-store transfers; An inventory optimization solution

You have probably heard about the concept of inventory optimization, but do you know how to make the most of it?

Inventory management is a tricky business. Too much inventory and you are tying up valuable resources that could be used elsewhere, too little inventory and you risk losing sales. What if there was a way to optimize inventory to always have just the right amount in hand? A way to ensure ideal inventory at all times?

Maintaining the right quantity of inventory required to meet demand, keeping logistics costs low, and avoiding common inventory issues such as stockouts, overstocking, or deadstock — make optimized allocation and replenishment in inventory management essential for any retail business. Store-to-store or inter-store transfer effectively manages seasonal and geographical demand fluctuations and is an effective way to optimize inventory. 

How does Inter-store transfer (IST) optimize inventory? 

Demand forecasting is vital for any retail business, but it is not perfect. Demand forecasting often fails, resulting in too much or too little inventory. One way to mitigate the risks of demand forecasting is to use store-to-store transfers to optimize inventory. Inventory management is a crucial part of any retail business. Too much inventory can tie up capital and lead to stockouts, while too little can result in lost sales. Inventory optimization is the process of finding the perfect balance between these two extremes, and store-to-store transfer is an effective way to optimize inventory. 

This technique also ensures that all stores of the retailer have the right mix of products in terms of colours, sizes, fit types, etc., while reducing overall inventory levels and costs. It also improves customer service levels by reducing stock-outs and increasing the availability of products. Overall, it is a powerful tool to help retailers improve their inventory management and bottom line.

Optimize seasonal inventory management with IST

There are several benefits of using inter-store transfers to optimize and better manage seasonal inventory. The very concept of a season has been re-defined in modern retail. Some retailers choose the conventional path of four seasons in a year, viz, Spring, Summer, Fall, and Winter. At the same time, retailers like Zara do twelve seasons in a calendar year, which means new stocks in the stores every month. With significant variations in climatic conditions within a country and during the same period, a store in a warmer climate could be selling more of a different product type than a store in a cooler temperature. Real-Time Data analysis can enable timely Inter store transfer to ensure that stores have the right inventory to meet customer demand.

When inventory is not selling at one location, it can be transferred to another site where it is more likely to sell. This helps businesses avoid the cost of storing excess inventory and better utilize their space.

The Role of technology in Inter-store Transfers

  • Technology Solutions to ease inventory optimization

Technology solutions can help retailers optimize their inventory levels and improve customer satisfaction. Inventory management software can provide insights into customer demand patterns and help retailers plan inter-store transfers to avoid stockouts. 

With real-time data and automated processes, retailers can quickly and accurately identify where inventory needs to be transferred to optimize their overall inventory levels. 

Additionally, tools like predictive analytics can help retailers anticipate trends and plan inter-store transfers accordingly, further enhancing customer satisfaction levels. 

The right technology solutions help retailers:

  • Analyze demand patterns and make recommendations
  • Conduct new-season and mid-season replenishments, 
  • Automate replenishment of fast sellers, 
  • Adjust inventory for seasonal changes and spikes, 
  • Consolidate stock sizes between stores 
  • Avoid stock-outs or over-stocking in any particular store or season

Critical Advantages of Inter-store Transfers

  • Minimizes Dead Stock, i.e. inventory that sits on shelves and never sells. It is a waste of money and resources, as it ties up valuable space in your store. Transfer inventory that is not selling in one store to another store where it might sell better.
  • Helps reduce stockouts or overstocking in stores. Ensure your inventory is constantly moving and never stuck with inventory that you cannot sell.
  • Enhances ROS by making the right product available at the right location 
  • Helps manage seasonal demand spikes
  • Supplements mid-season replenishments 
  • Better inventory turns by allocating stocks in the most appropriate locations 
  • Enhanced customer satisfaction

There are a few things to keep in mind when using Inter-store Transfers. 

First, it is essential to have a good understanding of your inventory levels and needs. Second, Store-To-Store Transfer should be used in conjunction with other inventory management techniques, such as just-in-time (JIT) production and Kanban systems. Adopting a robust inventory management solution with JIT, Kanban, Allocation & Replenishment, etc., tools built-in can make Inter-Store Transfers easier.

Finally, Store-To-Store Transfer may not be a panacea for all inventory problems. Still, it can be a valuable tool in your inventory management arsenal when used efficiently with the help of intelligent software solutions available today.