This rise in customer expectation concerns a litany of different matters, from customer experience to overall services, but one of the most often overlooked is product availability. Consumers want to be able to buy something instantly, with fewer shoppers willing to tolerate unavailable purchases and items going out of stock. It’s now a case of convenience over loyalty, which is why efficient inventory management is so crucial.
In today’s digital world, shoppers want to be able to purchase what they want when they want and on the channels they prefer. Failing to have the right amount of stock to fulfill demand will create missed sales opportunities and could even potentially affect your brand’s reputation, losing you future customers. This is why the positive impact of big data on inventory management is important for large and small businesses alike.
The importance of inventory management
Big data has many uses as it relates to businesses. Many companies will incorporate big data into their marketing strategies, but its application towards efficient inventory management is equally as important. A well-organized, customer-centric stock is pivotal to a supply chain’s success, so finding ways of utilizing data analysis for inventory management can lead to wide-ranging success.
Driven by increasing demand for competitive efficiency, today’s inventory management capabilities go beyond just ensuring accurate inventory. Today, these systems can provide powerful business insights that help make data-driven decisions regarding increased productivity, profitability and efficiency.
How inventory management is being handled in 2020
In 2020, big data in inventory management allows companies to study customer insights and data and forecast future demands by factoring in external factors and seasonality. Balancing product availability against market demand has always been a difficult task, but data analysis for inventory management makes this much more attainable. In this era of big data, inventory systems can also offer useful insights into customer behavior, product performance and channel performance that can constantly be improved upon due to growing data sets.
Ultimately, inventory management solutions are now equipped to apply a level of data science that was previously not possible. With big data continuing to evolve and augmented data analytics becoming more commonplace, it’s likely that these insights will become even more advanced as time goes on.
The different ways that big data supports inventory management
There are a few ways that the impact of big data on inventory management can support your business. These include:
Warehouse operations include many interconnected processes and if one stalls it can have severe consequences across the whole system. Big data helps to address these potential issues before they become a problem, ensuring operational efficiency increases.
Poor organization can lead to faulty processes. Similarly, proper organization can optimize the process, as collecting more information helps to better organize the overall inventory. By using big data to gather and analyze information within the warehouse, operational efficiency can be dramatically improved.
Improved customer satisfaction
Information gained from proper inventory management software can enable a better buying experience for your customers. It will help to improve the accuracy of product descriptions and the availability of specific items, along with ensuring the items are sent to the correct shipping location.
Big data will also help you better understand and analyze product returns. Once the reasons for returns are understood, you can reduce the likelihood of them occurring again and improve customer satisfaction. Efficient processing, something big data can support, will also speed up the overall return or exchange process, again improving the customer experience when interacting with your brand.
Not having enough of one product or too much of another will affect your business’ bottom line. It affects profits and customer satisfaction creating a vicious cycle that’s difficult to get out of. Typically, employees would check inventory manually and decide how much of each item to reorder based on gut instinct. The impact of big data on inventory management means that you can now base these decisions on facts and insights.
Analytics will reveal if some products are being purchased regularly which can trigger an automatic alert to staff to start ordering more before they run out. Using both historical sales and trend predictions, big data supports businesses to improve their inventory habits, making the process of inventory management much simpler.
Big data is transforming inventory management capabilities. It helps to reduce costs, improve operational efficiency, boost sales, increase customer satisfaction and lessen the risk of selling out of a key product. The insights big data can provide to inventory managers are increasingly granular, meaning you can make more accurate decisions and improve ROI as you’ll never have to turn down a sale due to a lack of product. Through full adoption of big dta, businesses can meet customer demands more efficiently and increase their revenue on a regular basis.