For fashion retailers in the current climate, there’s certainly no shortage of inventory-related challenges to overcome.
From overstock and short product life cycles to rapidly-changing trends and unpredictable shopper behavior, it can feel like a constant battle to avoid cash flow chaos.
Ahead of our exclusive masterclass for fashion merchants, this blog will explore the top three inventory hurdles retailers are facing right now and the best ways to overcome them in order to streamline operations, maximize sales and keep pace with ever-evolving fashion trends.
Most common inventory problems for fashion retailers:
1. Seasonal variability
Forecasting seasonal demand months ahead of schedule has traditionally been a major challenge for fashion retailers – all it takes in an unseasonably warm autumn or a prolonged cold snap in spring and you can be left with piles of deadstock, which has a devastating impact on cash flow.
However, the onset of climate change and less predictable seasonal weather mean it’s trickier than ever to plan inventory based on the seasons.
The solution: Advanced forecasting using cutting-edge demand forecasting software will accurately predict demand for every season. The best demand forecasting tools, like Inventory Planner by Sage, base forecasts on historical sales as well as variants like supply lead time, stock-out periods, seasonality and micro trends.
As a market-leading solution, Inventory Planner also automatically translates forecasts into simple, reliable buying recommendations so you know exactly which SKUs to invest in for the upcoming season.
Our latest [and FREE] masterclass will teach you how to master fashion trend forecasting to boost your bottom line. Sign up for it here.
2. Short product life cycles
In the age of influencer culture, fashion trends can (and often do) change overnight. This means many fashion products have an especially short lifecycle – in other words, they have a limited window in which to be sold before they become obsolete.
It makes investing in inventory especially stressful for fashion retailers because one poorly-planned step can lead to a warehouse full of unsold inventory that has to be discounted or disposed of.
The solution: Real time inventory visibility can make all the difference here. Instant access to accurate stock and sales data across all channels – which your inventory planning solution should provide – means you can respond swiftly to changing consumer demands and trends.
Inventory Planner’s advanced Overstock Report proactively flags up slow-movers (as well as best-sellers) so you can make informed decisions about when to discount, promote and bundle in order to protect your bottom line.
Retail analytics can also help you keep an eye on SKU-level contribution margins, ad spend and customer metrics to uncover true profitability of short life cycle products. Look for a solution that provides insightful suggestions across your product range to boost sales, reduce costs and optimize pricing.
3. Supply disruptions
Supply disruptions happen when the usual flow of inventory within a supply chain is interrupted. Reasons can vary from global pandemics and natural disasters to labor strikes, material shortages and poorly managed supplier communications.
Supply disruptions can be a huge headache for fashion retailers because they inevitably lead to stockouts (which means missed revenue and annoyed customers) as well as increased costs, product launch delays and the risk of inventory finally arriving but then being out of season.
The solution: A collaborative inventory planning platform which all teams across the business can use is essential. With all product, sales and supplier information in one place, supply chain issues can be proactively flagged before they result in major stockouts.
Plus, it fosters stronger relationships with suppliers, which reduces the risk and impact of future supply disruptions.
🎟️ You’re invited!
Want to learn more about planning inventory for your fashion brand? Join us for our upcoming masterclass: How to Master Fashion Trend Forecasting and Boost Sales. It’s completely FREE!