Smart Merchandising Technology

Seasonal Inventory Management: New-Season Allocation & Mid-Season Replenishment

In today’s retail environment of fast fashion, retailers have to replenish their inventory constantly. One of the main challenges faced is finding the right balance between being proactive in forecasting demand and reacting to changes in supply and demand.  

Seasonal inventory management is a business method used to manage inventory allocation and replenishment most cost-effectively and efficiently. The right seasonal inventory management plan can help a business understand its demand patterns and anticipate future demand. This allows retailers to plan their stock levels, new-season allocation, and mid-season replenishment efficiently. 

The first step in seasonal inventory management is to understand customer demand patterns. This can be done by analyzing past sales data and trends. Retailers can also use market research and surveys to gather information about customer preferences. Forecasting demand is tricky, therefore retailers need to consider several factors, including the season, upcoming events, and trends. If demand is overestimated, retailers could end up with too much inventory. On the other hand, retailers could miss out on sales if demand is underestimated.

The next step in seasonal inventory management is developing a plan for allocating and replenishing inventory. Retailers need to decide how much inventory to keep in hand, and how often to replenish and distribute among stores.

Critical Elements of Seasonal Inventory Management

Predictive Demand Forecasting: Predictive demand forecasting uses past sales data to project future demand. Merchandisers can use predictive demand forecasting to plan inventory levels and product mix to have the right products in stock when customers want them. Predictive demand forecasting is essential for seasonal businesses, like retailers who sell summer clothes or winter sports gear. By looking at past sales data, retailers can predict how much demand there will be for specific products in the future and plan their inventory levels accordingly. This ensures that they do not overstock on items that customers do not want to buy and helps them avoid stockouts of popular items. To make predictive demand forecasting more accurate, retailers can use multiple sources, like point-of-sale data, customer surveys, and weather data. This can help them account for changes in customer behavior and demand patterns. Retailers often use various methods to forecast demand, including trend analysis, statistical forecasting models, and market research, to get an accurate picture of future demand and plan their inventory levels accordingly. Merchandisers need to be aware of the latest demand forecasting methods and technologies to make the most accurate predictions possible.

New-Season Allocation: Product allocation is the process of distributing new products to store shelves. When allocating new products, retailers must consider the product’s popularity, shelf life, and the available space in stores to maximize sales and minimize stock-outs. New-season allocation involves organizing how much inventory should be allocated to be sold in the upcoming season. There are a few things to keep in mind when doing this:

– The amount of inventory allocated should be based on data for past sales patterns. If demand was high, then more inventory should be allocated. If demand was low, then less stock should be allocated.

– Allocating too much or too little inventory can be costly. If there is too much inventory, it ties up working capital and can lead to markdowns, too little inventory can result in lost sales.

– The goal is to have the proper inventory to meet customer demand without tying up too much working capital.

Mid-Season Replenishment: Mid-season replenishment involves rearranging inventory during a particular season. If a retailer seeks to maintain optimum inventory health, they will need to replenish before running out of stock. Mid-season changes in demand can be challenging to manage. If demand increases, there may not be enough inventory on hand to meet customer demand, which can result in lost sales. If demand decreases, there may be too much inventory on hand, which will tie up working capital. One way to handle mid-season changes in demand is to redistribute inventory across stores. This can be done by transferring inventory from stores with excess inventory to stores with low inventory levels. Store-to-Store or inter-store transfers will help to ensure that customer demand is met without tying up too much working capital. Modern warehouse technologies are a good investment for optimizing the mid-season replenishment process or making operations leaner. 

Auto alerts for low inventory levels: Retailers can use inventory management software to set up auto alerts for when inventory reaches a certain level. This allows retailers to replenish stock at the shortest lead time, which can help avoid stockouts and lost sales.

Auto-Replenishment of fast sellers: Replenish fast-selling items automatically to ensure they are always in stock while avoiding overstock of less popular items.

Inter-Store Transfers: An inventory redistribution method where inventory is transferred from one location to another. This type of transfer can be used to redistribute inventory based on changes in demand or to avoid stockouts at a particular site. Merchandising solutions can help retailers plan and execute inter-store transfers to minimize the impact on sales.

Adjusting inventory for seasonal fluctuations: Seasonal changes can significantly impact inventory levels. Retailers must be prepared to adjust their inventory levels to account for increased demand during holidays and other peak periods. They may also need to adjust their inventory to account for changes in demand due to weather changes.


Seasonal inventory management can be a complex and time-consuming process. However, it is essential for retailers to stay ahead of the competition and maximize sales. With the right inventory management strategy, retailers can manage seasonal changes and maintain healthy inventory levels. New-age merchandising solutions can help retailers track seasonal trends and make the necessary adjustments to their inventory levels. Auto replenishment of fast-selling items can help ensure that popular items are always in stock while avoiding overstock of less popular items. Inter-store transfers can be used to redistribute inventory based on changes in demand or avoid stockouts, and maintain healthy inventory levels at all times. 

With an effective seasonal inventory management strategy, retailers can increase customer satisfaction and keep inventory costs under control. A well-defined merchandise plan helps retailers tackle the challenges of seasonal inventory management by understanding customer demand patterns. Retailers can thus ensure that they always have the right products in stock.


How Distributed Warehousing Benefits e-Commerce

According to a survey, around 33% of customers have higher expectations for fast shipping, 40% for free shipping, and 42% expect a 2-day shipping option for every purchase. As customer expectations rise, e-commerce players face increasing pressure to provide more competent and efficient deliveries. This requires a new outlook toward backed processes and warehousing strategies. More and more companies are switching to the distributed warehousing model, as they provide the required flexibility and faster ecommerce fulfillment that today’s marketplace demands. In this blog, we talk about what distributed warehousing is and why ecommerce players are adopting it as a strategy.

Centralized vs Decentralized Warehousing

Both centralized and decentralized warehousing can be used as a distribution strategy depending upon business requirements, growth, and type of industry. Centralized warehousing means better inventory control, low operation costs, low inbound costs, high-quality standards, and customer service. On the other hand, it leads to high shipping costs for outbound shipments, increased shipping timelines, and a lack of business continuity. All these disadvantages can be covered by decentralizing your warehousing or opting for warehousing distribution.

Distributed warehousing is a business approach where a business fulfills, ships, or distributes goods from multiple smaller and strategically located warehouses. This enables businesses to locate the products as close to their end customers as possible, thus reducing the time and cost of delivery. Distributed warehousing allows brands to perform a number of functions, that is, storage, distribution, fulfillment, and cross-docking in a more flexible and efficient way.

When to go for distributed warehousing

As brands gain a larger market share geographically, the outbound costs of fulfillment from a centralized warehouse tend to rise as well. This is primarily due to the growing distance between the warehouse and the end customers. At one point, having a new warehouse close to the customer becomes more affordable as compared to fulfilling from a faraway centralized warehouse. Following the conventional cost-benefit wisdom, this is when businesses tend to make the switch to a distributed warehouse model.

How Distributed Warehousing Benefits Brands

As businesses expand geographically, managing the different aspects of a supply chain can become increasingly challenging. Packages may have to go through various locations or be routed through complex pathways before they reach the end customer. These complexities can be handled better by a distributed warehousing strategy. 

Short supply chain

By shortening the supply chains and fulfilling locally, e-commerce companies can reduce their transportation costs, ensure quality in case of perishables, provide faster order fulfillment, and reduce transportation risks. It also allows businesses to rise up to the new challenges of same-day delivery. Besides, shorter supply chains are a step in the direction of sustainable business, as these involve lesser CO2 emissions, reduced transportation costs, and the least possible environmental impact.

Lesser shipping and fulfillment costs

Speed of delivery is crucial but the cost of delivery is even more so, from the commercial point of view. This is all the more important as customers increasingly expect free delivery from their trusted brands. In most cases, the cost of shipping is a function of the shipping distance. Therefore, by locating the warehouses closer to the customer clusters, businesses can cut their average shipping costs.

Robust Business Continuity Plan (BCP)

A number of unforeseen incidents or catastrophes such as fire, floods, pandemic, and conflict, can disrupt businesses and their supply chains. Having alternative storage and routing facilities in place, courtesy of distributed warehousing can support business operations even during emergencies. Glitch-free operations and on-time promised fulfillment can go a long way in maintaining customer satisfaction and upholding brand reputation. 

Benefits of Outsourcing Warehousing Distribution

Distributed warehousing is well in line with outsourced warehousing as they allow the replacement of CAPEX with OPEX for an expanding business. 3PL providers in fact play a significant role in ensuring seamless operations while enabling brands to control their logistics costs. Their warehousing and distribution services are aimed at maximizing efficiency in terms of storage and distribution of goods. With outsourced warehousing, businesses can also enjoy greater scalability in times of peak demand or rapid business growth.

Outsourced warehousing and fulfillment takes the burden off the shoulders of the management, and allows them to focus on their growth strategy. As a substantial portion of supply chain management goes into the hands of the 3PL partner, they can bring in better integration, problem-solving, innovation, and integration.

How does WMS fit into the puzzle?

Managing multiple warehouses, keeping track of the collective inventory across warehouses, picking and shipping the right items, and tracing packages as they are routed through the increasingly complex supply chain requires an automated solution. A Warehouse Management System (WMS) takes care of all these processes which could appear rather overwhelming as distributed warehousing takes full effect. A WMS helps avoid errors, ensures high-level performance accuracy, and keeps your supply chain well-oiled.


Faster Omnichannel Order Fulfillment is the Future of Retail

Speed is one of the defining factors of omnichannel order fulfillment. According to a recent Mckinsey report, when delivery times are too long, almost half of the omnichannel customers will shop from elsewhere. To match growing customer expectations, brands like Amazon started off with an 8-day delivery horizon in the early 2000s, accelerated to two-day shipping by 2015, and even same-day deliveries in some markets by 2019. 

In fact, best-in-class omnichannel operations can now provide order fulfillment within two hours of purchase. Omnichannel has transformed order fulfillment by introducing dynamic routing of packages. Brands don’t just follow a linear fulfillment path from the warehouse to the customer, but even use their stores for order fulfillment.

Benefits of Omnichannel Order Management

Omnichannel order management orchestrates all orders across the enterprise and allows access to customer, order, and inventory information across channels. Here are some of the most significant benefits of omnichannel order management.

  1. Faster shipping at a lower cost: By utilizing nearby warehouses and stores, brands are able to deliver to their end customers faster and at much lower costs.
  1. Multiple purchase channels: Omnichannel offers customers endless options to choose from. Customers can buy online, in-store, or buy online and pick up in-store, as per their convenience.
  2. Personalized shopping experience:  By having a 360-degree of the customer, brands offer a uniquely personalized omnichannel experience to their customers that best suit their needs and ensures convenience.
  3. Real-time visibility: Omnichannel provides visibility of inventory across the channels and enables brands to provide updated and accurate information to customers.
  4. Empowers employees: With omnichannel OMS, employees can have information on real-time inventory, availability, and shopping history at their fingertips. This enables them to serve their customers more effectively.

Tackling the Same-Day Delivery Challenge

Same-day deliveries have become a new normal in many industries and among large urban customer groups. An ideal omnichannel strategy can help address the challenges of same-day delivery by offering a more flexible and agile supply chain support. With their dense network of stores, retailers can ensure greater proximity to their customer groups. Having the right kind of IT and automation support, brands can coordinate among channels, to offer the fastest-possible fulfillment. 

The evolving role of brick and mortar stores

Even though online shopping has made a serious leap during and since the pandemic, in-store shopping is not going away. Brands need to reimagine the role of their brick and mortar infrastructure, as they can act as strategic assets for same-day delivery. In doing so, they can maintain their current layouts, fully transform into dark stores or become a hybrid of the two. Stores also have a crucial role to play in building brand experience for customers and a way to give a first-hand experience of products.

Physical stores are a critical link in the process of channel integration, and keep the customer journey across channels seamless and fluid. According to a recent Mckinsey survey, senior executives from the ten largest North American retailers reported that during the pandemic, they received higher growth in e-commerce sales in areas with a physical presence as compared to those without brick-and-mortar stores.

Is Omnichannel the Future of Retail?

Customers are rapidly developing a taste for path-breaking fulfillment ideas like BOPIS (Buy Online Pick up In-Store), and the Click and Collect model that enables them to order online, and then simply walk into a nearby store to collect the product. Omnichannel commerce evidently offers ease, agility, and unprecedented levels of CX. 

By offering highly personalized communications and services, omnichannel puts each individual customer at the very center of e-commerce operations. It provides brands with a great opportunity to collect more data and track customer behavior across distribution channels. This translates into better-informed business decisions and more effective strategies.

Omnichannel offers customers a consistent and coherent shopping experience, also ensuring better customer service as the operations rely on a common and centralized database. No matter where the customer makes the purchase finally, they can research the product on numerous channels of distribution to receive the same information. This ensures seamless CX and the highest levels of customer satisfaction.

Finally, the omnichannel retail strategy helps create shorter supply chains, which significantly reduces the overall distance, costs, and emissions. Omnichannel is therefore the right step in the direction of sustainability and can bring lasting benefits to businesses, industries, and regions most sensitive to environmental impact.

Omnichannel is clearly a peek into the future of retail. As it evolves, an ecosystem of innovative solutions such as Distributed Order Management (DOM) will emerge. DOM systems are software solutions that orchestrate various processes and automate functions like order routing, splitting, shipping, forecasting, and inventory management. Solutions like these will reinforce the idea of omnichannel and drive the transformation of e-commerce further.


E-commerce Inventory and Order Management with Scalable WMS

Businesses demand rapid scalability from brands and retailers, especially in times of peak demand and business growth. When your website takes up to 5 seconds to load, there’s a 90% chance that your customers will bounce to a competitor’s site instead. During the season, there could be a significant ebb and flow in demand due to factors like weather, end-of-season sales, or festivity. Dealing with seasonality, therefore, requires a robust and agile warehouse management system to facilitate scalable operations just when they’re needed.

What is WMS?

A Warehouse Management System consists of software and processes using which retailers can control and administer warehouse operations. When the demand peaks, an ideal WMS must ensure that orders are captured and fulfilled accurately. A cloud-based WMS like Increff WMS can scale quickly as a business is growing or experiencing spikes in demand. A scalable WMS offers the right picking, packing, and inventory management even under pressure.

How to manage inventory and warehousing operations efficiently with WMS

  • A warehouse management system allows you to match orders to facilitate accuracy in inbound and outbound logistics. By optimizing and automating the receiving process, a WMS ensures that errors are reduced. 
  • Using serialization or barcoding, a WMS keeps track of batches for effective inventory control, even during peak sales time, thus providing a consolidated view of the available inventory in real-time.
  • Automating the processes for allocation, replenishment, picking, printing labels, and fulfillment, a WMS helps meet peak demand efficiently. 
  • It offers accurate and error-free picking to avoid wrong delivery, unnecessary return, and loss of sales.
  • Managing reverse logistics efficiently in case a customer returns an item, a WMS facilitates the circulation of the product back to the sales channels immediately.

What are Economies of Scale in Warehousing?

Times of peak demand and drastic business growth provide retailers with a unique opportunity to sell huge volumes of products. This helps them accrue the benefit of “economies of scale” which essentially refers to a reduction in the per-unit cost of an item due to the huge volume of sales. 

By providing efficient operations, centralized warehousing, and large storage capacity, warehouses provide economies of scale. For instance, instead of shipping individual packages, large batches of items are shipped to the stores at the same shipping cost, thus reducing the cost per unit item. Likewise, the storage costs per unit product decline during peak demand due to large volumes in the warehouse, as opposed to fewer items during periods of normal demand.

What is Order Management; Processing, and Fulfillment?  

Order management is a vital part of operations for any e-commerce business. It starts with tracking and monitoring orders which can only be ensured with automation provided by a WMS system. This is especially true during rapid business growth and peak demand, to avoid errors and manage orders with accuracy and agility.

Order processing refers to the process or workflow from placement to delivery where reliability and accuracy are a must to ensure customer satisfaction. Picking, packing, sorting, shipping, and tracking are important steps that form part of order processing.

The entire process from when the sale takes place till the product is delivered to the customer is known as order fulfillment. This depends on 3PL partners and is augmented by an efficient WMS solution that helps drive the whole process without errors and inaccuracies. 

Perfect Inventory and Order Management for Scalability

An inventory management system can be quite complex with a number of moving parts which can cause shortages if not handled well. Inventory management for a business that is scaling up begins with forecasting the demand as accurately as possible. Projections based on past data or recent trends in customer behavior can help have the right inventory to avoid under or over-stocking. 

Having strong relationships with vendors and partners can help ensure seamless supply during peak demand. Vendors who have open stock inventory can fulfill orders as needed, this is on-demand manufacturing or Just-In-Time inventory management.

Finally, with automated order management systems, retailers can avail the benefits of APIs that offer flexibility, efficiency, and scalability. These enable a retailer to streamline operations while catering to huge customer demand.

Scalability is one of the most essential features of a WMS as it allows a retailer to meet the growing challenges of a burgeoning marketplace. Not having ample scalability means loss of sales, dent in a brand’s reputation, dissatisfied customers, and plummeting revenues.


Building Integrated Digital Supply Chains for Omnichannel Retail

Supply chain integration brings together all the functions in omnichannel fulfillment into a single system. It necessitates careful coordination and alignment to ensure everyone is working towards the same objective. Supply chain integration is an ongoing process that needs to be regularly updated and tweaked as the business evolves.

Most common Supply Chain Integrations: 

  • Vertically integrated Supply Chains: Vertical integration occurs when a retailer takes control of one or more stages in the fulfillment process. Thereby, owning multiple stages of the process with the aim of increasing market share and gaining tighter control over the supply chain. Vertical integration can be backward, towards procurement & production, or forward towards the end consumer. 
    • Backward Integration: When a retailer expands across multiple supply chain segments beyond its value chain, e.g. merging operations with another company that provides the goods or services required for omnichannel fulfillment. A basic example of backward integration could be that of a fashion retailer partnering with a garment manufacturing unit.
    • Forward Integration: When a retailer takes control of the business activities ahead in the value chain, expanding to the next levels of the supply chain and getting closer to the end consumer in the value chain. For example, a fashion retailer pursues forward integration if it partners with a last-mile delivery company.

Marketplaces are a great example of vertical integrations. They bring together sellers and buyers in a single platform, making it easy for both to find what they need; a greater reach to a larger audience, and better prices.

  • Horizontally Integrated Supply Chains: Horizontal integration is a strategy when related or similar functions being done by multiple companies merge. In its most basic form, horizontal integration is acquiring a commercial entity operating in the same industry or level. In this technique, a company takes control by buying, merging, or seizing control over other businesses in the same sector’s value chain. Actual examples of horizontal integrations can be Adidas with Reebok and the merger of Vodafone with Idea. 

ERPs are an excellent example of horizontal integrations. They combine the various functions of a company, such as accounting, marketing, and purchasing, into a single system, thus allowing companies to streamline their operations and making it easier to track inventory and sales.

Benefits of Supply Chain Integration:

  • Improved control over distribution
  • End-to-end visibility
  • Enhanced flexibility to demand fluctuations
  • Increased efficiency
  • Cost savings
  • Improved customer satisfaction

Methods for increasing productivity & effectiveness through integrated supply chains:

  • Present and Future Business Mapping: Determine the present level of supply chain integration and the gap to reach the future desired state. This mapping could be done at four broad levels:
    • Basic: At this level, the extent of the silo approach needs to be mapped; if various departments within the company work on issues separately and disconnected.
    • Functional: Map the information flow within the company to determine the dependability and responsiveness of interdepartmental working.
    • Internal: Determine if all departments and functions are connected to one IT structure, use insights from central data analytics and inter-related information dashboards. Additionally, map the alignment of overall company objectives, for example, the customer-first approach, along the entire value chain.
    • External: Determine if all vendors and service providers in the supply chain collaborate and operate almost as one to meet customer demand, boost efficiency and profits, and meet OTIF.
  • Data Integration and Data Analytics: Consumers produce an enormous amount of data, that can significantly impact supply chain management and improve demand forecasting. Using consumer and corporate data to identify threats and opportunities in the supply chain can assist retailers in mitigating risks in omnichannel fulfillment. This is only feasible if supply chain system integration is implemented. Also, real-time updates are essential for effective supply chain integration. Everyone involved in the process needs access to up-to-date insights to make quick decisions based on the latest data analytics. Supply chain planning with real-time data analytics ensures economies of scale, OTIF, and that inventory is correctly aligned with demand.
  • Integration with Logistics Partners: This ensures that products are stored in distribution warehouses and delivered to the customer quickly and efficiently. Crucial for supply chain integration is better collaboration with vendors through connected systems, leading to overall improvements in inventory management. End-to-end supply chain transformation is required to implement a successful last-mile plan. Retailers must establish a last-mile strategy that addresses their current end-to-end supply chain inadequacies and aligns them with the final objectives. A digitally integrated supply chain, for example, may help distribution centers construct a comprehensive last-mile solution that reduces delivery lead times.

Digital supply chain integration strategies are essential for companies looking to fulfill orders through omnichannel retail. Businesses can streamline their operations and provide a great customer experience using the right tools and tactics. Bringing all the stakeholders together to streamline processes as one continuous and transparent flow might be challenging. There are, however, a variety of tools available today that can make the process of supply chain integration simpler.


Advantages of the Marketplace model vs Inventory model for E-commerce

The e-commerce industry has been around for more than a decade now, and it has changed the dynamic of operation of most of the world’s retail marketplaces. One of the major shifts e-commerce players have experienced is the shifting from an inventory-led model to a marketplace model for inventory management. The inventory-led and marketplace e-commerce models are both major parts of the e-commerce industry, but play different roles in the market. Marketplace platforms and online stores have both become powerful e-commerce business models within the digital economy.

Let’s look at the definitions of the inventory model and the marketplace model:

Inventory Model– This is when a marketplace e.g. Amazon, sources volumes of inventory from brands & sellers and stocks it in its own warehouse. The e-commerce marketplace owns the inventory and sells it directly to the customers, managing the logistics and every aspect involved in the e-commerce business. 

Marketplace Business Model– Following a zero inventory policy, the e-commerce platform acts as a facilitator between the buyer and the seller, providing an efficient, transparent, trusted virtual environment for commerce. The inventory remains with the seller and customers directly buy from the sellers, while the e-commerce platform manages the logistics. 

With increasing momentum in the D2C business model, the marketplace model of inventory management has become popular. As marketplaces can stay lean, they are prepared to adapt to the changing competitive e-commerce landscape easily.

5 advantages for sellers to take on the ecommerce marketplace business model of inventory management are:

  1. Better Capital Utilization for maximizing efficiency – Managing capital investments wisely means better cash flow, faster business growth, and greater competitive advantage. Traditional e-commerce ventures were highly capital-intensive involving setting up large storage spaces and handling associated management, warehousing, and logistics costs. The marketplace model of inventory management now distributes this burden to individual suppliers thus making business more viable. While Marketplaces manage the platform and logistics, sellers manage their inventory which gives them better control over the supply chain.
  2. Highly Scalable– New-age technology solutions like Increff WMS, allow sellers to expose 100% inventory across multiple sales channels simultaneously. Without segmenting or blocking inventory for a specific channel, sellers can achieve greater inventory visibility, higher sales, better margins, and greater cash flow. With the real-time inventory update feature of Increff WMS, as soon as an order is placed on one channel, that quantity of inventory gets deducted from the overall stock, so the available quantity of inventory is only visible at all times. This prevents marketplaces from accepting excess orders even during peak sales. The robust tech backend facilitates millions of interactions between the servers every second, without any downtime, to ensure perfect sync. With the rise in SaaS technology solutions, infrastructure upkeep is low for sellers since maintenance and updates are handled by the tech provider. 
  3. Better control over customer data – As orders directly reach the seller, they get complete access to customer data. With efficient warehousing and faster order processing using Increff WMS, brands/ sellers can ensure faster order fulfillment and better customer service. They can analyze region-wise demand and plan merchandise for the upcoming season accordingly. 
  4. Wider Reach – Marketplaces have an existing well-developed customer base so individual brands/ sellers can capitalize on it thus saving efforts and costs in marketing for themselves. They also have a well-established network of Third-party logistics providers so brands/ sellers can ensure efficiency in the last mile.
  5. Investor-Friendly – Entrepreneurs need financing and support to flourish their startup idea. Marketplace provides an established platform to expand the business, maximize sales, minimize returns and increase brand loyalty. D2C aggregators like Globalbees, G.O.A.T, Mensa Brands, etc. are investing in D2C brands and using advanced tech platforms, like Increff WMS, to boost the business growth of individual brands in their portfolio. Such immediate growth creates an advantage over other businesses searching for an investment.

Increff WMS solving challenges of the Marketplace model for Brands & Sellers

  • Increff WMS allows efficient inventory management, 100% accuracy, and traceability of inventory within the warehouse. 
  • Sellers need a central standardized platform to view all data that would be coming from multiple marketplaces. Increff WMS provides a single platform to view inventory movement across different sales channels and multiple downloadable reports, at every stakeholder level, for in-depth analysis. Brands can analyze sales at individual channel levels and estimate the right assortment plan for each channel to capture maximum customer demand.  
  • The real-time inventory order sync feature ensures no excess order is received from any marketplace and that the inventory is updated at all times for a better customer experience
  • The robust tech solution supports millions of interactions per second between the Marketplace and seller panel, without downtime, to ensure smooth system interaction and zero glitches. This allows easy, effortless business scalability and growth. 
  • Inventory serialization in Increff WMS allows rapid returns processing and efficient re-commerce to maximize sales opportunities.  

7 Best Ways to Reduce Omnichannel Fulfilment Costs

The retail industry has broadly acknowledged and understood that slow and steady might no longer win the race. Operating in this digital age, being fast and accurate in order fulfilment is crucial to success.

Today B2B and B2C consumers expect fulfilment beyond seamlessness of identifying and buying a product, accuracy and on-time delivery, to post-sales support. 

This has been a difficult target for retailers, given the exponential growth and multiplication of sales channels. The market is expected to grow at a CAGR of 7.7% from 2020 to reach $29,446.2 billion in 2025. The global retail market is expected to reach $39,933.3 billion in 2030, as a result, realigning retail fulfilment has been the top priority in the past few years, and the industry has made a paradigm shift from the conventional “warehouse fulfils” model to the “omnichannel fulfilment” model.

What is Omnichannel Fulfilment?

Omnichannel fulfilment means that a retailer’s inventory is available on multiple sales channels, both online and offline – to provide a unified shopping experience to the customers. Omnichannel fulfilment optimizes resource utilization to ensure that orders can be fulfilled from a store or a warehouse, whichever is convenient and nearest to the customer. 

Critical Advantages of Omnichannel Fulfilment:

  • Accelerated Inventory Turns
  • Shorter Lead Time 
  • Improved Customer Satisfaction
  • Improves Brand Loyalty

Rising Costs in Omnichannel Fulfilment:

Order fulfilment speed and accuracy is at the core of giving experiences to customers that they demand today. Many retailers struggle due to omnichannel fulfilment’s high logistical and administrative costs. 

The reason is the complexity of sales and distribution through multiple channels. The challenges could be in the following areas:

  • Transportation and shipping costs are fluctuating and ever-increasing. Throughout the retail supply chain, logistics costs are paid to manufacturers, trucking companies, third-party logistics service providers, shipping carriers, freight brokers, and various other vendors
  • Inefficient warehousing processes lead to inventory mismanagement and loss in sales
  • Inadequate inventory stocking and allocation in stores, warehouses or fulfilment centres, resulting in regional product shortages, overstocking and inventory mismatch 
  • Lack of inventory analytics that can provide an overview of historical operational performance across different sales channels 
  • Last-mile challenges like lack of infrastructure leading delayed fulfilment in smaller towns
  • Manufacturing defects or other errors in products that are sold and shipped
  • Messy and expensive reverse logistics to manage returns

Retailers will need to be innovative to be profitable across channels, as customers expect faster deliveries and 100%  accuracy in order fulfilment. Retailers can manage costs and significantly boost customer satisfaction by having an analytical and data-driven approach to omnichannel fulfilment strategy.

Best Ways to Reduce Omnichannel Fulfilment Costs:

  • Product Sourcing: It may be worthwhile to review sourcing from vertically integrated manufacturers closer to the retailer’s warehouse. This will ensure that sourcing is done in the most cost-effective manner.
  • Region-Wise Inventory Optimization: The idea is to be closer to the customer to reduce freight, delivery lead times and all costs associated. Retailers must ensure a healthy equilibrium between inventory distribution and regional demand by allocating the right inventory closer to the right customer, on their preferred sales channel. 
  • Outsource Multi-Location Warehousing: Dedicated contract warehousing reduces fixed and recurring costs. Retailers should consider outsourcing warehousing or cloud warehousing services to reduce omnichannel fulfilment costs. 
  • Improve Picking and Packing Process: This labour-intensive task is always a high cost. Making the process more efficient and applying tools to measure employee efficiency would help reduce costs and increase productivity. Inventory should also be serialized to automate the entire process and have 100% inventory traceability.  
  • Inventory Analytics: This provides critical insights so retailers can improve business intelligence with sophisticated data science for the most efficient product handling. Retailers often have cash flow locked up in additional or inaccurate inventory due to a lack of analytics. It is imperative to invest in technology that gives a streamlined and most current view of your inventory in relation to demand. This will help improve cash flow and enhance ROI. 
  • Solve Last Mile Challenges: A report by SOTI finds that nearly half of global transportation and logistics companies use outdated technology for last-mile delivery. It offers little help in combatting delays and high shipping costs. With the implementation of a platform that can provide real-time information, logistics challenges and added costs can be addressed by businesses. Value-added partnerships also help companies synergize to streamline deliveries and returns. Fulfilment costs can be reduced as brands don’t have to build new functionalities but simple partner with companies that have respective expertise.
  • Simplify Returns Process: Consumers have come to expect a hassle-free return policy, no matter which channel they purchase on. The primary goal of reverse logistics is to recover value from assets to increase revenue and reduce expenses. This can be done by directing the returned product to the nearest point of supply and made available for purchase afresh, ensuring the defective products have been segregated. 

With an omnichannel focus, the retail business has become broad, diverse, and complex. However, some retail giants are ruling. These are retailers that have established immense credibility by delivering consumer expectations while maintaining healthy bottom lines. It is time every retailer prioritizes omnichannel fulfilment cost reduction by adopting technology-driven solutions. 


E-commerce Return Analysis: Solution to the Trillion-Dollar Returns Problem

A free returns policy by online retailers has been pivotal in the exponential growth of online sales platforms. The easy returns option has not only lured conventional brick and mortar stores, customers to online sales channels but has also given the customer more comfort and confidence in online shopping.

This has indeed led to a substantial positive impact on sales and revenues e-commerce business channels. However, this “freebie” has a big cost attached to it. Once all the costs associated with ecommerce return management are added; shipping, storing, inspecting, segregating, etc, sometimes this is greater than the original sales price. Not only does this cost a logistical nightmare but steadily eats into the bottom lines of online retailers. 

Studies have shown that in 2021, retailers expected 16.6% of the merchandise sold, back in returns, which is a 6% jump from the previous year. As sales continue to increase, so does the returning trend. As per a recent NRF report, for every $1 billion in sales, retailer incurs approximately $166 million in merchandise returns. These ecommerce return rate statistics has made it inevitable for retailers to devise a robust returns management strategy. 

Since there is no way to control consumer behaviour or stop online shoppers from ordering multiple variants to try and experiment, businesses must make returns processing hassle free and efficient. It’s time to make ecommerce return policy more robust and reverse logistics less expensive. 

Ways to minimize ecommerce return rate:

  • Website Design: Making improvements in the layout and flow of the website eliminates the chances of clicking on the wrong product or size.
  • Product Display: Ensuring the product display has multiple high-resolution photos. One can also consider including product videos.
  • Product Description: Making sure the customer comprehensively understands the product and helps to ascertain if the product is right for them.
  • Sizing Chart: Providing a size chart relevant to target customers’ area or geography.
  • Packaging: Ensure fool-proof packing so products do not get damaged during shipping. Use the best packaging material for that product type.
  • Online Support: Supporting customer concerns with a Live chat option via chatbots can eliminate any customer’s guesses while ordering.
  • Order Confirmation: Using online tools to confirm order placements, especially cash-on-delivery orders. This adds an extra layer of security, ensuring the orders are genuine place by willing customers
  • Order Accuracy: Being first-time right in the entire process from order receipt to delivery—right product to the right customer at the right time in the correct quantity.
  • Clear And Concise Returns Policy: Displaying your returns policy on the home page, highlighting the hassle-free returns’ terms and timelines.
  • Transparent Delivery Lead Time: Providing an estimated date of delivery down to the pin code level

Factors to minimize the negative impact of product returns:

  • Data Analysis:
    • Region & Pincode wise: Use actual data to analyse area-wise consumer behaviour. This helps ascertain trends; perhaps a particular product type, size, colour, or fit may not be most suitable for a given area.
    • Product Categories: A streamlined returns processing should help list most returned product types and help formulate better sales and pricing strategies.
    • Reasons quoted for return: 100% traceability goes a long way to understand reasons cited for products returned, and consistency analysis of the same should be helpful to set effective countermeasures. 
  • Logistics: Multi-system integration to streamline reverse logistics and enable returns at multiple warehouses or physical stores. Reverse logistics being messier than forward logistics, a data-driven multi-integrated tool will help reduce chaos and costs to manage returns more efficiently.
  • Inspection: Of returned products to draw relevance with reasons cited by customers for their returns and optimise re-sale of sound products.
  • Segregation: Of defective or damaged products will ensure the same product is not sold again and returned repeatedly.
  • Feedback: Both to and from customers who make returns will help retain valued customers and build trust and loyalty.

The Solution:

Increff Returns Management Solution elements all the above concerns to make returns management a lot easier and less costly. A few more features of this tool include:

  • Web-based automated SaaS tool
  • Segregates returned items into refurbished, rejected and re-saleable categories
  • Provides 100% Traceability
  • Reduces sales loss opportunity
  • Faster SPF claims processing
  • Built-in reports
  • Enables multi-warehouse returns
  • Is multi-system integrated

Maximize profits with Retail Price Optimization

What is Retail Price Optimization?

Customers are comparing prices all the time and across channels –  online and offline. They have apps that suggest discount codes and they are always looking for offers that give them the most value for their money. Even in such a time of changing consumer behaviour, unfortunately, many retailers rely on old-fashioned pricing practices, using past trends or even gut instincts to set their product pricing. This is not an effective way forward.

Retail Price Optimization is understanding in advance how customers will react to markups and markdowns in original price. With the use of advanced software, companies can stay ahead of the curve by strategically planning the entire price cycle while meeting both sales targets and margins. 

Price Optimization is done using complex algorithms that are designed to evaluate the change of demand with dynamic pricing strategies. This is matched with the data on costs, and inventory levels, to ascertain optimal prices to maximize gross margin. The price optimization strategy is incredibly important for a healthy and growing bottom line.

Retailers that are starting to use price optimization models and markdown management techniques to automatically optimize selling prices are gaining a leading edge over competitors. Machine learning continues to evolve and advanced software solutions combine this with price optimizing algorithms that make reaction to changes faster and more robust.

Factors affecting the retail price:

Internal Factors:

  • Business Goals/KPI’s: Conventionally, businesses set prices based on sales targets which becomes the driving force in price setting and price optimization. However, setting prices based on business goals alone is not effective anymore. An array of data, like fixed costs, historical sales data, market trends, customer sentiment, needs to be accumulated in conjunction with one another to fix the most optimum selling price.
  • Input Cost: Most manufacturers use the input cost plus a markup to fix the retail price. While this is an important consideration in devising the price strategy, it should not be done in isolation. Input cost alone fails to account for consumer-led factors which are essential to fix the right price. For example, the perceived value of the brand, whether the product being sold is a luxury item and customers are willing to pay a premium for it, brand loyalty are all factors that should be taken into consideration in addition to the input cost.
  • Past Performance: Evaluating the past sales performance of the product at different price levels to analyze how customers responded. This is one of the most crucial factors in developing the optimal retail price for different times
  • Inventory Factor: The volume of inventory influences retailers to change the retail price of products. Higher volumes of inventory usually lead to a markdown and discount in retail price to encourage quicker inventory liquidation

External Factors:

  • Demand Factor – The central driving force in retail price management is an analysis of the demand. Setting retail prices rigidly too high may lead to certain products not selling. Price elasticity is a relationship between the supply and price: the more elastic the prices, the more they influence the sales.
  • Competition – Setting retail prices too low can lead to price wars where nobody is making any profits and all are continuously lowering retail prices. A robust retail price management strategy should keep a close tab on competition activities
  • Sales Channels: The nature of sales channels, both offline and online is diverse today and plays an important role in demand creation and therefore retail pricing
  • Other Factors: For products that are climate-subjective or more popular during certain months of the year, price optimization should be done considering these factors

Process of Retail Price Optimization 

  1. Business Considerations: Collect accurate data of all of the internal factors mentioned above, input costs, historical data, competitor pricing, and fluctuations in demand. This comprehensive data will put into a picture how each of these factors affects demand and therefore the price and profitability.
  2. Customer Considerations: In conjunction with the above business considerations, retail price management requires in-depth data about customers and their behaviour. Customer reviews, demand and supply trends, market trends, and most importantly, customer sentiment towards the brand and product are data points that should feed the price optimization strategy.
  3. Product Value: One of the most important considerations is the perceived value of the brand’s products. If we can understand quantitatively how much the customer values the product or certain features, the pricing strategy can effectively satisfy customers and also help maintain a healthy margin.
  4. Data Analysis: Once all the data has been collected, it can be fed into software that will predict what segment of customers are willing to pay what price, in certain market conditions. This analysis determines markdown management and thus promotions.
  5. Pricing Strategy: After the data has been thoroughly analyzed, a pricing strategy must be put in place. There are various pricing philosophies that can be explored depending on the nature of the product. The pricing plan encompasses markups and markdowns at different stages of the product lifecycle.
  6. Continuous Improvement: Putting the pricing strategy in place does not amount to a rigid pricing policy. Once the plan is in action, the prices and respective demand and sales should be closely monitored. Market conditions change rapidly and unexpectedly, and prices must be optimized accordingly. 

Benefits of Retail Price Optimization:

Data-driven price rationalization in the retail industry allows businesses to set the right price at the right time. 

  • Price optimization keeps businesses safe and customers happy. Deep discounts and profit cuts may not be the only solution to meet sales KPI’s. With price optimization, brands get better margins as they base price on smart decisions by eliminating guesswork and using real data that matters. This means actionable insights that make a big, lasting difference.
  • Helps businesses devise product portfolio pricing, dynamically setting the price for different products in the family
  • Price optimization strategies allow businesses to put into play a markdown strategy as per changes in the season and market trends. Not only does this help minimize the seasonal loss in revenue but helps capitalize on higher demand in certain seasons
  • Data analysis helps determine the optimum price at different times for products sold at brick and mortars, in various geographic locations while factoring in uniformity of pricing on online channels
  • Implementing dynamic pricing leads to better inventory turns, thereby improving cash flow
  • Helps businesses identify and capitalize on best selling products
  • If the process of retail pricing has been automated with the use of advanced software, reacting to market changes can be quicker and more scientific 

An effective price optimization strategy keeps the customers happy and the balance sheet healthy. Every brand functions in an ultra-dynamic market and the retail price of products must be receptive to these changes. Increff Markdown Optimization tool helps automate pricing decisions at multiple points of sale level and dynamically increases or decreases discounts for the right set of styles to maximize sales and optimize profits. It identifies out-performers and bestsellers, based on the sales trends, and helps brands automatically re-order the right quantity at the right time to ensure no sales loss opportunity. 

Keeps your pricing strategy proactive to not just quickly adapt to market changes but also maximize profits. Now is the right time to plan and execute a price optimization strategy! Know more about Increff Markdown Optimization: 

Smart Merchandising Technology Warehouse Management

How D2C Brands Scale Exponentially with New-Age Inventory Management & WMS Solution

D2C e-commerce is growing faster with increasing penetration of mobile and internet services, and the mushrooming growth of 3PL companies, especially in the urban areas. It offers benefits like cost-cutting, greater control of the supply chain, better quality management, and more efficient returns management. 

All this requires automated support in terms of inventory storage, order management, packaging, and logistics. This is where a new-age Warehouse Management Solution (WMS) plays a crucial role in inventory management for D2C businesses.

Inventory management and merchandise planning for e-commerce

As soon as brands take charge of their supply chain, a number of technical areas demand attention. Foremost is optimizing warehouse space to expedite order picking and smoothen overall order processing. Synchronizing incoming orders and inventory, establishing the best possible floor plans, and picking rules, are some of the prime functions of a new-age WMS. 

Maintaining inventory accuracy with unique piece barcoding assigned to each incoming piece in the warehouse is critical. Hand-held devices used for order picking, synchronize with the WMS and display complete product information on scanning the barcodes. The barcodes capture individual product details to help detect their exact location within the warehouse. It increases accountability by recording details of every action performed on the item within the warehouse, and also ensures order picking efficiency, enhances accuracy, and prevents errors. 

Assortment planning, space management, and in-season planning are some aspects of inventory management orchestrated by an automated inventory management solution. These solutions make use of analytics and algorithms to ensure inventory planning is aligned with the long-term strategy of a brand for a given customer segment.

Managing returns and rapid re-commerce

Returns management is a serious concern for growing brands. To keep returns under check and the cost of re-commerce under control, D2C returns management requires an automated solution.

An automated WMS helps brands accept incoming orders, sync with the inventory, and ship them as soon as possible. It helps trace returns, avoids delays, streamlines return management, and reduces the cost of return logistics. Products spending too much time on their way back to the warehouse are at a greater risk of getting damaged. Returns management solution finds the shortest route back, enabling brands to expose the stock for resale as soon as possible. It sorts products into categories such as refurbished, resalable, and unsaleable, based on which it disperses them in the value chain. As D2C brands seek to gain complete control of their supply chain, a comprehensive returns management policy is necessary and must be centered on automated returns management software.

Markdown optimization for D2C brands

Setting the right price could be a daunting task for brands. Going too low could affect their relationship with retailers and confuse customers about the authenticity or quality of the products. Dynamic pricing, based on data-driven algorithms, takes into account a diverse set of factors like competitors’ prices, demand-and-supply dynamics, and levels of inventory. Dynamic pricing in e-commerce helps brands keep their pricing aligned with their channel strategy in a given marketplace.

Demand-based inventory distribution

For brands expanding over larger geographies, distributing inventory to multiple warehouses, so that the products are located closest to the customers, is the best way to reduce costs and ensure quick fulfillment. As brands expand their businesses, it becomes more expensive to ship products from a single warehouse as compared to renting out space at multiple locations. Tools such as Increff Regional Utilization ensures brands and retailers have the right levels of inventory as close to their customers as possible. The tool is completely web-based and performs millions of computations within minutes to find the right level and style of stock for each fulfillment center. 

D2C poses a number of challenges for brands but automation offsets these by providing sharp insights, precise allocation, and efficient handling. This makes brands highly competitive by keeping a check on delays, costs, labor overheads, and space or stock wastage.