2023 Gartner® Market Guide for Retail Store Inventory Management Applications
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The 2023 retail and ecommerce peak season is fast approaching, and it’s set to be anything but ordinary. Since 2017, each peak season has brought its unique challenges and opportunities, from labor shortages and space constraints to surging order volumes and potential sales losses.
Ahead, we explore the key strategies that will drive maximum profitability during this peak season, specifically automation and effective multichannel management. Plus we’ll cover the steps you can take now to start getting ready for a painless, even more profitable 2024 peak season.
As we gear up for another year of retail success, the market is undergoing significant changes. High inflation, looming recession concerns and the expectation of a 71% decrease in sales volumes due to reduced consumer spending have prompted retailers to order less peak inventory. Many of these uncertainties stem from the post-pandemic holiday season. And while we don’t know what 2024 will look like yet, it will likely be heavily influenced by how this season goes.
Being ready for peak seasons to come requires careful examination of the approaches that your organization is currently taking toward peak season. Here are several strategic areas that every retailer should be monitoring.
With 2-3x the usual order volumes, setting high standards of fulfillment is paramount. Focus on timely and reliable deliveries, even with same-day delivery norms removed. Plan meticulously, adjust staffing, streamline processes, and leverage automation for labor shortages and space optimization. While meeting Service Level Agreements (SLAs) is always critical, peak seasons bring an added level of stringency. Utilize intelligent picking strategies, such as batch/multi-order picking to release a cluster of orders to coincide with pickup times and ensure that you won’t risk missing SLAs.
In the race to fulfill orders swiftly, there’s a risk of employees selecting the wrong items, resulting in incorrect shipments that disappoint customers and cost revenue. By implementing a Multiagent Orchestration (MAO) solution, retailers are able to streamline warehouse operations, gain enhanced visibility, reduce errors and optimize space utilization. At the same time, investing in robotics reduces reliance on manual labor and maximizes throughput during peak season.
By implementing a Multiagent Orchestration (MAO) solution, retailers are able to streamline warehouse operations, gain enhanced visibility, reduce errors and optimize space utilization.
Customers often encounter significant frustration when they place an online order only to discover a few hours later that the desired item is unavailable. This issue can be effectively addressed through real-time inventory reporting and orchestration software. Ensuring the availability of your top-selling products is absolutely crucial for maintaining a smooth and reliable order fulfillment process.
Retailers can expedite the returns process via automation, with seamless reinduction in hours instead of days, weeks or (in many cases) never. High volumes of returns are expected during and following peak periods, and profitability and customer satisfaction hinges on a retailer’s ability to process returns as quickly as possible.
Embracing options like Buy Online, Pick Up In-Store (BOPIS), click and collect, and in-store fulfillment benefits both shoppers and retailers, especially during late-season rushes. These choices not only increase sales but also lower transportation costs and relieve strain on delivery carriers. To enable these channels, flexible processes and adaptable software are essential, allowing retailers to easily configure various fulfillment strategies for different sales channels.
RELATED READ: Top 4 Peak Season Challenges – and How to Tackle Each
To truly excel during peak season, it’s vital to balance your ecommerce and retail operations effectively. The best way to achieve this is to implement a fulfillment orchestration platform, which will allow your business to take advantage of the following benefits:
In conclusion, navigating the retail peak season requires a combination of strategic planning, technology adoption and a strong focus on multichannel operations, all of which will only become more important as we head into 2024.