Meeting demand and ensuring a seamless customer experience throughout peak season requires visibility, flexibility and quick action from retailers. This extends to how they manage their inventory.
Overstock and average mile constraints due to labor and asset shortages are two big issues plaguing retail, says Dennis Moon, chief operating officer at Roadie, a delivery platform participatory on demand.
In response, he says, retailers should seek out multi-threaded operations and fulfillment solutions that can improve their responsiveness while acting as a fail-safe. In addition to aligning with strategic fulfillment partners who can quickly scale and retract based on customer demand, retailers can also take a pragmatic and sustainable approach to their warehouse logistics and inventory management. .
Let’s look at three best practices suggested by Moon to ensure inventory is where you need it, when you need it, during peak season.
1. Take a hybrid approach to inventory management
The just-in-time (JIT) approach to inventory management requires retailers to manage inventory as efficiently as possible, bringing stock in when needed. In contrast, the just-in-case (JIC) approach favors stockpiling to minimize risk.
Retailers generally aspire to JIT, which allows them to reduce overhead and improve cash flow. But without the extra inventory to act as a buffer, any disruption to planning (like bad weather) can slow or stop shipments. As a result, many rRetailers are turning to JIC as supply chain disruptions and the ongoing talent war threaten their ability to meet demand. But holding extra inventory comes at a cost that many retailers simply can’t afford.
Instead, retailers can benefit from a hybrid approach, using JIT where they can safely and JIC where they must, all with careful and strategic inventory placement.
Rather than taking additional inventory to mitigate the impact of underlying operational issues, the resulting hybrid model focuses on resolving root causes.
“By increasing inventory visibility, improving operational efficiency and creating flexible fulfillment capability, retailers can minimize the need for costly safety inventory while building a competitive advantage,” Moon says.
2. Design your warehouse for efficient inventory movement
Moon also warns that when increases in demand exceed retailers’ ability to deliver, inefficiencies can lead to lost opportunities and increased costs, not to mention disappointed customers.
Here are some steps you can take to ensure your warehouse is running at full capacity this peak season:
Increase your inventory accuracy by performing a total pre-season physical inventory.
Optimize pick and pack workflows so fast-moving products are easily accessible.
Dedicate a spacious and ideally located space to organize deliveries.
Group and route deliveries based on geographic location or delivery times to save money without sacrificing time.
Clearly label orders for quick and efficient pickup (ideally using technology that increases accuracy, such as barcodes or RFID).
Look for opportunities to optimize your facility’s footprint by consolidating packages or using containers for more uniform storage.
If your last mile fulfillment toolkit includes an on-demand platform like Roadie, make sure your team is ready to work with outsourced delivery drivers. Consider these tips for successful order transfers:
Post clear signage to direct drivers to and through your facility.
Make sure your loading or pick-up area is accessible to passenger vehicles.
Train your team. Make sure your employees are aware that outsourced drivers won’t be wearing a uniform, and if they’re new to your establishment, they can ask employees for help.
Provide a point of contact and phone number so drivers can call quickly if they have any issues.
3. Route inventory to the correct node in your network
Moon explains that As stalled supply chains and consumer demand for faster delivery continue to force change in retail, product positioning has become critical. To remove the need for mid-mile deliveries and ease asset constraints, retailers have begun to move away from traditional distribution routes and keep inventory closer to their final destination.
Partnering with an on-demand delivery platform such as Roadie allows retailers to quickly and easily transfer inventory between stocking locations, such as retail stores, warehouses, or distribution centers. This gets merchandise where it’s needed, when it’s needed – helping retailers deliver on the promise of super-fast delivery and even facilitating returns with home pickup.
As peak season approaches, Moon’s biggest suggestion to retailers is not to wait.
“Avoid the panic call and do it now,” he says. “Some of the biggest challenges we face relate to managing change from an employee perspective. Contact a crowdsourcing partner now, build your operational plan, run proof-of-concepts, and get things done so you can transition into peak season efficiently.
Ready to learn more about how crowdsourcing and direct delivery from retail can help you anticipate this peak season? Click here to view Roadie’s roadmap to peak season success.