4 Ways to Improve Inventory Management and Delivery (Webinar)
Your delivery promise can make or break a sale. For example, 99 percent of U.S. consumers say fast delivery is important to them when making online purchases. Amazon has raised the bar. But, not every retailer can match what Amazon has built. Nor should they. As an online retailer, there are other ways to attract and retain customers—much of which comes down to inventory management across your fulfillment network to improve your delivery promise.
Last week, FLEXE’s VP of Operations, Megan Evert, and Shippo’s Director of Business Development, Richard Garcia, joined forces to talk through optimizing inventory management for the holiday rush and how it can help you create a better delivery promise to your customers. You can watch the full recording of the webinar here.
Below are four steps you can take to improve inventory management and delivery.
Listen to Your Data
You have data at your fingertips: how many items are in your average basket size, what your most popular products are, the highest concentration of customer demand. Identifying key insights about your customers’ preferences can help your teams make more informed decisions about how to better manage your inventory and improve your delivery promise, including:
- Is your demand far enough from customers to justify adding another fulfillment center nearer to them?
- Which carriers and service levels ensure the best delivery times for the best costs?
- Based on product lines and best-selling items, what type of delivery promise should you offer?
Not every item or every purchase calls for free, two-day delivery—not even Amazon offers that for every product in its marketplace. Understanding who your customers are and what they prefer is the first step in determining how to improve their experience, and it’s all in your customer data.
More Locations = Shorter Delivery Times
For most retailers and brands, improving your delivery promise means shortening the last mile of delivery by expanding and diversifying your network. Not everyone can, or should, absorb the cost to expedite order fulfillment with air transit.
Instead, you can shorten the last mile of delivery and take advantage of ground transportation with more fulfillment locations in your network. According to our network analysis, supported by Starboard Corp., you can reach nearly 70% of the U.S. market in two days or fewer with just two facilities.
In the webinar, we break down how much of the U.S. is reachable with one, two, three, eight, or more warehouses for next-day, two-day, and three-day shipping. If you’d like more specific analysis, please download the recording.
That said, traditional methods for getting more warehouse space are expensive and often require long-term lease commitments. Again, not every business wants to invest in long-term solutions that yield little flexibility. In the webinar, you can see how FLEXE’s dynamic approach to warehousing has helped three very different customers better manage inventory and build out a distribution network that meets their customers’ expectations.
Cross-Network Inventory Management
Managing inventory across multiple locations requires a unified view and visibility across your network. Being able to view real-time inventory levels and order data helps you track your high-performing SKUs and see changes to both inbound and outbound inventory as they happen. But, that’s just part of it.
Having a fulfillment solution that guarantees and measures KPIs on the warehouse floor is a must. It won’t matter that you can reach your customers with two-day, ground delivery if your warehouse is not shipping on time or completing orders. Make sure you’re identifying and tracking your warehouse KPIs to ensure efficiencies.
It’s also critical to find a solution provider that helps you track and optimize the metrics you’re measuring. Continual improvement is key, both for customer experience and improving your margins.
Use a Mix of Carriers
Shipping with multiple carriers lets you compare rates and service levels to choose the best option for your needs. You’ll have access to a variety of delivery estimates and costs that you can pass on to your customers.
As an added benefit, you can leverage your relationships with other carriers once it comes time to negotiate for rates, which gives you greater power in the process.
Oh! Keep These In Mind, Too
There’s only so much you can control, especially peak season hits and demand is high. Here are just a few suggestions to keep in mind:
- Make sure your teams are aligned and using the same set of order and inventory data. If Sales puts a product on promotion that doesn’t have sufficient inventory to support demand, your company will take a hit, but more importantly your customers will be disappointed
- Make sure there is dynamic order routing to intelligently manage shipping when an item in the closest warehouse is out of stock
- When launching new products, make sure launch dates are realistic. There’s nothing worse than promoting something and then immediately putting it on backorder.
- We all want to make our customers happy, but don’t over-promise. Disappointing customers on when and where their packages will arrive can damage your brand more than having a longer delivery promise
Remember less is more. Don’t over-complicate things. Make it easier by focusing on the items that can really drive sales. Put your money into purchasing and stocking your key SKUs. And, always attach a forecast to every product. If you don’t measure against a goal you won’t be able to effectively evaluate results to make adjustments going forward.
Having visibility across your network will help you better manage your inventory and more quickly respond to issues when they arise. It will also help you improve your delivery promise and win customers over faster. With the above tips, you’re well on your way.
For more inventory management tips, watch the on-demand webinar here.