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2 in 3 Retailers to Replace Outdated Merchandise Planning: Survey

Progressive Grocer – Two of three retailers plan to upgrade or replace their merchandise planning systems within two years because they are out-of-date and don’t effectively address current requirements for an omni-channel environment, says a new survey from Boston Retail Partners.

Many retailers are using planning applications designed for old retail business models, many of which were installed in the late 1990s or early 2000s, according to the consulting firm. As a result, many retailers today are trying to meet the needs of a 21st century customer while constrained by 20th century technology.

“Stores are under siege from other channels and unfortunately are dealing with outdated and ineffective systems to address the complex planning process that is required in an omni-channel environment,” said Ken Morris, principal, Boston Retail Partners. “All of this negatively impacts the customer experience and, ultimately, sales.”

Read full article: 2 in 3 Retailers to Replace Outdated Merchandise Planning: Survey

Is RFID the Silver Bullet for Inventory Accuracy and Visibility?

RFID Whitepaper_Cover_Dec-2014In a recent BRP white paper, RFID – The Silver Bullet for Inventory Accuracy and Visibility?, we explore how radio-frequency identification (RFID) technology is emerging as a critical enabler of the omni-channel experience. RFID provides retailers with real-time visibility to accurate inventory across the enterprise, making it an imperative to real-time retail.

A catalyst for significant economic benefit, RFID gives retailers the ability to automatically identify and track goods, as well as capture instant information on a wide range of merchandise. As the technology has gained traction, it has allowed retailers to reap financial benefits and efficiency gains while strongly supporting the unified commerce model.

Retailers are taking note, evidenced by RFID’s deployment among retailers such as Zara, Saks Fifth Avenue, Lord & Taylor, Macy’s, Bloomingdales, and Chico’s. As the retail industry accelerates the shift towards an omni-channel retail model, more retailers are likely to follow suit by incorporating RFID technology into their environments to support a true unified customer experience.

Evolution of RFID Technology

Despite the inherent benefits of RFID technology, its adoption by retailers has been a slow process for budgetary reasons. RFID per tag costs were previously prohibitive for many retail applications; however, technological advances have resulted in significant price decreases and have made RFID more accessible to a broader range of organizations.

Value Proposition

RFID technology provides retailers with an opportunity to significantly improve sales, gross margin and markdowns through better leveraging of real-time, accurate inventory information. Since logistical inventory tracking can be extremely laborious for all retailers, and particularly those with stock keeping unit (SKU) intensive models, organizations stand to profit considerably by RFID Benefitsemploying RFID.

Omni-channel Enablement

As it relates to omni-channel initiatives, RFID provides fundamental support to businesses that offer a large assortment of styles, colors, and sizes. Near perfect inventory accuracy is needed to realize real-time retailing capabilities such as buy online and pick up in-store, buy online and receive in-store, and buy in-store and ship to home. SKU depth can cause item quantity distortion, as maintaining exactness in inventory counts presents numerous execution issues.

Read the BRP RFID white paper for more details on RFID, including case studies and a 3-step methodology for implementing RFID.

DOWNLOAD NOW:

WHITE PAPER: RFID – The Silver Bullet for Inventory Accuracy and Visibility?

While RFID has been slow for retailers to adopt due to cost and ROI challenges, reductions in costs and advancements in technology are certainly making RFID an attractive proposition for retailers.

But is it the silver bullet? What do you think?

As always, I welcome your thoughts and opinions. Please share your comments below.

Ken

Using Social Media Insights for Merchandise Planning

In my last post, I discussed the dramatic increase (550%) in the use of social media by merchandisers in the past year, revealed by our 2014 Merchandise Planning and Allocation Benchmark Survey.  After reading our survey report, a few retailers have asked us for ideas on how they can or should be using social media insights in their merchandise planning processes.

Here are a few ideas on how to use social media for merchandise planning.

Tapping the value of social media beyond brand awareness

Beyond the obvious reason to increase brand awareness and loyalty, social media is becoming an imperative marketing and merchandising tool for retailers. Social media has created an avenue where retailers can actively engage their customers and “listen in” on the social dialogue.  In addition to facilitating open communication with consumers, it also allows retailers to glean valuable insight into the preferences of their target market. This real-time insight to customer preferences enhances retailers’ merchandising decisions to offer the right products, at the right place and at the right time.

Enhancing merchandising decisions

Leveraging a strong social media campaign, retailers can influence the trends and key items for the season.  Retailers can incorporate social media feedback on trends when planning their future lines to help drive merchandise decisions that reap substantial financial benefits such as a reduction in markdowns, higher gross margins and increased sales.Store Shelves with Towels_Blog

Traditionally, assortment decisions are made in a meeting with a handful of people. Retailers can now enhance assortment decisions based on consumer opinions from social media platforms. For instance, retailers can test different styles/assortments and receive a quick response that helps segment the ‘likes’ based on products, demographics and psychographic attributes to augment other data in merchandise planning decisions.

Beyond planning, social media insights can also play a roll in managing order levels and replenishment. Based on real-time social media responses and feedback on new merchandise, retailers can adjust order levels, allocation and replenishment to maximize margins.

Other ideas for social media

We foresee social media becoming more fully integrated into retailers’ e-commerce sites. Retailers are already making it easy for customers to post recent purchases and discuss products on social media sites like Facebook. The next step is to enable consumers to buy directly from the social media sites without having to navigate pages in the e-commerce solution.  This technology is currently available and provides a prime opportunity for retailers to make it easier for the consumer to get what they want, whenever and wherever they want it and in real-time.

As always, I welcome your thoughts and opinions. Please share your comments below.

Ken

Retailers report a 550% increase over last year in the use of social media for merchandise planning!

What a difference a year makes! We have seen a dramatic increase in the use of social media by merchandisers in the past year, as retailers look for innovative ways to enhance their merchandising decisions.

Just released this week, our 2014 Merchandise Planning and Allocation Benchmark Survey revealed that retailers are focused on expanding their use of social media and other technology solutions to deliver the products consumers want in a seamless shopping experience.

While the use of social media for merchandise is still a fairly new idea, BRP’s survey of top retailers uncovers considerable windows of opportunity for retailers to optimize business processes and leverage advanced technology to enhance the effectiveness of merchandise planning and allocation decisions.

Here are some of the key findings that demonstrate the achievements of retailers leveraging technology to improve their merchandise planning processes: MPA Survey Cover

  • Nearly 50% of retailers have integrated business processes and systems across channels
  • 31% of retailers utilize a single inventory across channels
  • 26% of retailers have real-time visibility of in-store/online inventory

Retailers are focused on those areas of improvement to enhance their assortments:

  • 33% of retailers utilize CRM data to feed their business intelligence tools
  • Nearly 40% of retailers use social media to facilitate planning within product development, a 550% increase over last year’s report

I encourage you to read the complete survey report for additional insights on how retailers are focused on improving their merchandise planning and allocation processes.

Download Now: 2014 Merchandise Planning and Allocation Benchmark Survey

As always, I welcome your thoughts and opinions. Please share your comments below.