This blog post was excerpted from our new e-book, Real-Time Inventory: Building Competitive Advantage with Redis Enterprise. Download it for free now!
Dave is a suburban dad looking to buy a new instapot to make preparing his family’s meals faster and more convenient. Dave doesn’t have a lot of time, so he’s looking online to find out whether nearby stores have the device available for immediate purchase or whether their online counterparts have ones available with guaranteed two-day delivery.
For smart retailers with real-time inventory, Dave is an opportunity to make a sale and gain an appreciative customer. But for retailers that don’t know—in real time—what their stores have in stock, Dave represents an opportunity cost.
If Dave doesn’t get his instapot delivered on time, or makes the long drive out to the mall across town and the item isn’t actually available, he’s likely to be extremely annoyed, go elsewhere to make his purchase, and perhaps even share his frustrations on social media.
Yikes! Nobody wants that!
That’s just one reason why managing real-time inventories across multiple physical and digital channels and locations is so important.
But that’s only the beginning of the story. What if the retailer had lots of instapots in one location, but only one left in another? To avoid losing future sales, retailers should strive to democratize inventory between well-stocked stores and those low on available-to-promise products to avoid selling out the last item from a particular location.
Similarly, real-time inventory is essential for optimizing order fulfillment and shipping costs. For example, Dave might order his instapot online or at his favorite store, but omni-channel retailers might be able to speed the process and reduce costs by having the device delivered from a closer store or warehouse, or even one already delivering to other locations near Dave. It’s all about making sure items are in the right place, at the right time, at the right price.
But wait, there’s more!
Without real-time inventory, retailers can’t optimize inventory, yield management, and supply-chain management. Relying on historical data makes inventory forecasting less accurate, increasing costs from carrying excess inventory and requiring unnecessary shipping.
Retailers can also face reduced yields due to poor execution of enterprise-wide pricing and promotional strategies—for example, the inability to allocate available inventory to the highest-margin locations. Real-time inventory is also an essential component of a unified national order-fulfillment strategy, letting retailers pool geographically clustered store locations and warehouses to contribute to a single inventory.
Finally, retailers without real-time inventory management risk product unavailability in the face of natural events and disasters. Before the event, real-time inventory management lets companies redirect fulfillment to healthy regions or proactively stock potentially impacted areas. For example, if a hurricane is predicted, retailers can boost inventory in the affected area of everything from food and water to sandbags and plywood. More importantly, the store database must remain available even if it becomes cut off from the enterprise. This lets the store continue operating with assurance that all of its inventory information will automatically sync with the enterprise database—without any conflicts—once connections are re-established.
In sum, real-time inventory enables an omni-channel retail strategy, delivering a unified, seamless, and consistent customer experience across all channels, including in-store, websites, mobile apps, email, and social media. A typical customer journey, for example, might begin with discovery on social media, browsing on a mobile app, purchasing in-store, shipping to a home address, authorizing return via email, and physically returning the item via snail mail.
This approach democratizes regional inventory based on geographic availability instead of limiting the sales opportunity to a single store location. And it enables retailers to implement and monitor key capabilities like shipping to and from a store, finding items in a particular store, reserving an item in store for pickup, enabling customers to buy online and pick up in store, and many more. Without it, retailers risk leaving money on the table, inflating costs, frustrating customers, and reducing the accuracy of their forecasts and planning.
This excerpt shows why real-time inventory is essential for large omni-channel retail enterprises, but building and maintaining these complex systems in the real world can be a daunting task. Want to learn why traditional inventory systems based on RDBMS technology don’t measure up in the modern omni-channel retail environment? Download the full e-book, Real-Time Inventory: Building Competitive Advantage with Redis Enterprise, and see how Redis Enterprise supports real-time inventory management by providing optimum database performance at peak scale and ensuring deep consistency among multiple channels (stores/websites/mobile/social/more) while minimizing infrastructure and technology sprawl.