FEATURE
E-commerce Is on the Rise : Are Your Inventory and Order Management Strategies Ready ?
By : Donald Felbaum , Aptos
The Philippines , like many countries around the world , is experiencing rapid adoption of e-commerce . According to a recent report , e-commerce has driven significant growth in the Philippine digital economy at 55 percent .
As Bernadette Nacario , Country Director , Google Philippines , was quoted saying , “ The country ’ s e-commerce growth is a mirror of both the resilience and vast potential of our digital economy .”
In the past year , the resilience of Filipinos has certainly been put to the test . And while our country , people and businesses look ahead to a brighter future , there is no denying that COVID-19 will leave lasting impacts .
One of these lasting impacts will be the changes in consumer behavior . Social distancing and lockdowns have changed shopping habits considerably , accelerating a culture of digitalization and the aforementioned rise of e-commerce transactions .
Consumer Behaviors Continue to Evolve
As retailers rush to adapt their business models for a post-pandemic era , they are taking into account the certainty that customers ’ buying journeys will never be as linear as they were before .
While e-commerce will never fully replace the tactile experience of shopping in person , a retailers ’ online store – or marketplace – is increasingly the “ front door ” to their selling environment .
As shopping patterns become more fluid between physical and digital realms , customers require more flexibility and agility from retailers . They also expect seamless operation at every point in the buying journey , including how , when and where their orders are fulfilled .
Inventory Management Grows More Complex
Meeting shoppers ’ expectations to buy , collect and return from virtually anywhere is a daunting task . Inventory remains the single largest cost driver for most retailers . Nowadays , retailers have to manage stock with enough accuracy and flexibility to fulfill omnichannel demand .
Adding to that challenge is the fact that when a retailer lacks visibility because that inventory sits in disparate silos , the retailer is losing out on opportunities to satisfy its customers . Make no mistake : poor inventory visibility hurts profitability .
One example of this is products that get “ stuck ” in one channel when another channel could have sold the item faster – and at better margins .
Start by Establishing a Single Pool of Inventory
As omnichannel complexity increases , retailers can feel forced to purchase additional inventory to meet omnichannel demand .
However , what retailers should be focusing on is developing real-time visibility into their inventory , into each customer ’ s choice and , ultimately , into the status of each order .
Retailers looking to achieve optimized inventory and order management strategies must start by establishing a single view of inventory .
By establishing a single view of inventory , retailers can better manage fulfillment performance , including offering services such as click-and-collect with confidence . They can also accommodate requests coming from different channels with greater levels of flexibility .
Optimize Fulfillment Flexibility with Order Management
Once you have established a single view of inventory , you may find that you need less stock than you used to . By leveraging your entire estate to fill orders , you are better prepared to maximize return on one of your largest investments . When it comes to technology that supports an enterprise view of inventory and optimized fulfillment performance for consumer orders , leading retailers are investing in order management systems .
An order management system should be able to capture orders from any channel and support a long list of omnichannel fulfillment use cases , from ship to home to click-and-collect and everything in between . As part of the order management process , the system exposes available-to-sell inventory from every fulfillment location ( store , DC , third-party , vendor ), based on rules managed by the retailer .
The system should also have the ability to collect , prioritize and intelligently route orders . In the Philippines , where orders are typically fulfilled from Luzon and shipped to Mindanao over a thousand kilometers away , an advanced order management system can help retailers save money on logistics by using inventory from stores on the island where the customer ’ s order originated . Also , when regional lockdowns are in place in certain provinces , these systems can help retailers to better sell “ dead ” inventory and apply strategies like ship-from-store .
By focusing on an order management platform that can serve multiple order creation and order fulfillment processes , retailers can insulate themselves from disruptive changes to core processes , even while the consumer-facing side of the retail model continues to evolve .
The Value of Omnichannel Inventory Management
In the end , retailers who figure out how to serve their customers with the right products at the right time , and to do so quickly , will win . Customers left waiting in the dark about the status of their orders will shift their loyalty to retailers that are better prepared to meet their needs . With the right inventory management strategies and omnichannel capabilities , retailers can fulfill their customers ’ orders – and more importantly , can fulfill their evolving expectations .
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