Executive Briefings

How Power of Inventory Visibility Can Be Destructive Force

Inventory visibility is critical to cross-channel flexibility, but a tiered approach to store fulfillment is the brains behind doing it profitably.

Visibility-enabled cross-channel activity has been going on for years. In stores, associates are leveraging enterprise-wide inventory visibility to apply the "endless aisle" concept, thus saving sales and maintaining customer service when items are out of stock. Likewise, retailers are beginning to make in-store inventory available to online commerce in the event of e-commerce DC stockouts, going so far as to pick and ship web orders from stores.

However, anytime, anywhere, any place inventory visibility is potentially problematic. It's an enabler of careless profit margin waste. It's ruined many merchandisers' floor sets and sent buyers into tailspins of sourcing and allocation unpredictability. In unskilled hands, the power of inventory visibility can destroy your best-laid plans.

Historically, as retailers consolidated and created visibility into siloed data, many rushed to "turn on" a facade of omnichannel fulfillment. Doing so is akin to breaking ground on a new home simply because you have access to the materials needed. You can take an inventory of every nail, stud and shingle necessary for construction, but without a building plan, where do you start and how much trial and error are you willing to expose yourself to during and after construction?

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Visibility-enabled cross-channel activity has been going on for years. In stores, associates are leveraging enterprise-wide inventory visibility to apply the "endless aisle" concept, thus saving sales and maintaining customer service when items are out of stock. Likewise, retailers are beginning to make in-store inventory available to online commerce in the event of e-commerce DC stockouts, going so far as to pick and ship web orders from stores.

However, anytime, anywhere, any place inventory visibility is potentially problematic. It's an enabler of careless profit margin waste. It's ruined many merchandisers' floor sets and sent buyers into tailspins of sourcing and allocation unpredictability. In unskilled hands, the power of inventory visibility can destroy your best-laid plans.

Historically, as retailers consolidated and created visibility into siloed data, many rushed to "turn on" a facade of omnichannel fulfillment. Doing so is akin to breaking ground on a new home simply because you have access to the materials needed. You can take an inventory of every nail, stud and shingle necessary for construction, but without a building plan, where do you start and how much trial and error are you willing to expose yourself to during and after construction?

Read Full Article