Blog Written By | ERPFocus
Why your retail ERP needs a good multi-channel inventory module
Merchandise management is what sets retail ERP systems apart from ERP designed for any other environment. Merchandise is the inventory a business has right now for sale to customers desiring those items. To have exactly the color and size a customer wants immediately available is the goal for any retail business. Further, it just arrived in minutes ahead of that customer and can be priced at an amount that begs that customer to buy immediately and yield a profit at the same time. Is this possible? Yes, most of the time, the right retail ERP system can help make it a reality.
Retail today goes beyond the physical storefront. ECommerce is a major part of retail now. Merchandise management is largely the same, you need the right item on hand and available for sale when the customer is online or present in the store. If your retail business trades online then it is essential that your centralized inventory module is fully integrated with your ECommerce system.
Cost and price management
COst of an SKU is closely related to the supply chain component of retail ERP. A successful retailer works closely with current suppliers to stock merchandise that a customer wants at the lowest possible total cost. Supply chain systems also connect to new suppliers who might have products even more desirable at even lower prices. The low initial cost is the first target. Total cost includes the ability to easily and quickly make returns to the supplier at little or no penalty. The cost can also include financial terms such as payment due after the sale. If the supplier can monitor sales and inventory levels using an inventory module, they can replenish fast-selling items without the need for a purchase order.
In addition, price management might mean a supplier can provide special, lower prices for seasonal or promotional merchandise. These cost and price management tools should be sought after in any retail ERP.
Retail stock ledger
An accurate count of each SKU on hand with separation by every size, color, and other distinctions is an important part of retail ERP. As customers pay for their purchases and leave the store, that stock ledger should be automatically updated. Return merchandise that cab still sold should be added to the ledger right away. Shrinkage or other unexplained loss of inventory is an unfortunate reality in retail and each SKU should have a reasonable rate used to adjust the ledger.
An accurate ledger helps determine when to replace replenishment orders. An accurate ledger also is a tool to monitor those items that do not sell so that they can be returned or moved to a store where a sale is more likely. An accurate ledger is a critical component in determining expenses and profit or loss over time.
Forecasting and planning
Retail has a strong seasonal element to it, so accurate forecasting activities are essential. ERP is a valuable tool to ensure an optimal profit in any season. How many soccer balls were sold last year in the weeks before the start of the season? What was the weather like last year and what is the weather forecast for this year? ERP doesn’t maintain all this data, but in retail, an ERP can match data it has with external data to predict how much to order and when to accept delivery. A supplier might make those soccer balls over months and make several deliveries to a warehouse to match your requirements against their ability to produce. Those early delivered soccer balls are a part of the stock ledger but also a liability as payment will not be made until the season begins.
These are key features of any good centralized inventory module. Know which ones are important in your particular business and be sure the ERP you select has the ones you need. LS Retail is a top-performing solution that can manage all inventory merchandise, forecasting, and omnichannel aspects of your business.