Having weathered the overstock and stockout challenges of the last few years, prioritizing precision in demand forecasting is a top goal for every retailer – especially those seeking to reduce expenses and enhance profits.
To help, we recently hosted a webinar titled Expert Inventory Insights: How to Boost Profit and Cut Costs For a Brighter 2024, featuring industry experts from retail giants like John Lewis, as well as e-commerce disruptors like Sparkle in Pink and MAX + STONE. It was a popular session, packed with practical insights, and the feedback has been excellent.
In case you missed it, here’s a roundup of the top takeaways:
It’s all about inventory balance.
The big challenge for retailers is striking the right balance between overstock, which ties up cash, and stockouts, which annoy customers. All panelists stressed the importance of taking proactive measures, predictive analysis, and strategic planning for successful inventory planning, which can all help reduce lost sales, avoid necessary markdowns and lower costs.
Technology is your friend.
Advanced technology offers valuable insights and can help you accurately forecast demand and always know what to buy, and when to buy it. The panel universally agreed on its instrumental role in controlling and planning inventory.
However, they also noted that the essential assistance provided by tech should be combined with sound strategic and logistical planning. Technology is a powerful tool, but not a magic wand.
Open-to-Buy (OTB) can change the game.
Implementing an OTB plan can bridge planning and trading, ensuring businesses have the necessary cash to meet future sales and inventory demands.
Alison Metcalfe, in particular, shared how OTB can be used to indicate budget allocation for inventory purchase and ensures businesses have the necessary cash to meet future sales and inventory demands. Open-to-Buy planning doesn’t have to be complicated and stressful if you have the right technology in place (like Inventory Planner).
Collaboration is key.
Effective inventory management requires a well-connected and communicative organization. Whole teams across departments need the same access to inventory insights and data to ensure informed decisions, collaborative working and alignment of strategies.
Don’t forget about the impact of ‘stock age’.
Stock age refers to how long inventory has been held or stored in a business without being sold. Panelists highlighted how stock age can have a huge impact on revenue and profit. They outlined the reasons it should be minimized – namely to avoid selling at reduced prices and to maintain product relevance.
These five key takeaways offer a glimpse into the wealth of knowledge shared during the webinar. But there was lots more covered, too, including:
- How to have tricky conversations with suppliers about performance
- Real-world examples which show the importance of syncing marketing with inventory planning
- Why strategically handling returns is critical to inventory planning, especially for the apparel and fashion sector
Dive deeper into all of the strategies mentioned in this blog – watch the full recording here.