We always keep in touch with our customers to get their feedback on the Inventory Planner experience, and some recent research gave us some great insight into what means most to their business when it comes to inventory planning.
From our conversations with our base of over 3,000 retailers, we were able to derive the most popular Inventory Planner features and how brands are using it to power growth.
The future is forecasting
The most essential feature of Inventory Planner according to retailers was its data-led forecasting, which uses historical sales data to accurately predict sales, while also factoring in seasonality, microtrends and shifting lead times. As part of its multifaceted forecasting functionality, these were some specific factors our customers said they couldn’t live without:
Using forecasting to eliminate safety stock
For years calculating ‘safety stock’ (ordering in more products than needed) has been a traditional way for retailers to tackle unexpected spikes in demand, but it can lead to hoarding a surplus of products in the warehouse that don’t end up selling. In our research, retailers said Inventory Planner’s accurate forecasting and purchasing recommendations eliminated the need for safety stock, as they now always order the right amount of products for incoming demand, despite seasonal changes or market shifts.
Forecasting for multiple locations
As companies grow and their geographical scope expands, opening new warehouses is good business sense. Inventory Planner offers forecasting not just for different channels but locations too – meaning you’ll be informed of what needs to be replenished for each warehouse, and can even move stock between warehouses for efficiency. Omnichannel retailers who use Inventory Planner, such as independent knife retailer Knifewear, said this ability to segment forecasting geographically means they can get orders to customers more quickly and efficiently use warehouse space.
Tiffany Wight, Warehouse Manager for Knifewear says: “As a buyer, Inventory Planner has given me the power to make data-driven decisions about the stock we order and when we order it – for both our physical stores and our website.
“Now, we always have the right items in the right location in order to maximize sales. Overselling has become a thing of the past and we’re no longer holding anywhere near as much excess stock.”
Using forecasting data to inform marketing decisions
With intelligent, data-driven forecasting, retailers are able to align their marketing efforts with incoming demand. It’s always useful to build hype in line with a predicted sales spike, but this doesn’t just apply to products that are selling well. If inventory data shows that demand for an item is low, or a product line is fast becoming outdated and could benefit from being pushed (either by discount or another promotion), marketing teams can build campaigns to push these slow-movers out of the warehouse and into customer’s shopping carts.
This is given extra power by connecting Inventory Planner with Google Analytics, which will bring in page view and conversion rate analytics for your product pages and provide solid evidence for marketing decisions.
Forecasting and planning for bundles and assemblies
When your product lines are mostly made up of bundles and kits, it can be a nightmare of complexity to forecast and create purchase orders for particular components – especially if you’re doing it manually in spreadsheets. Inventory Planner consolidates demand for an item in the many ways it’s sold – individually, or as part of a bundle. It easily forecasts for bundles and kits and nested assemblies – identifying what parts need to be replenished, how long assembly might take, and lead times for individual components. With this technology, retailers are always prepared ahead of time when bundle or assembly orders come in.
Big e-comm retailers who work primarily in bundles and kits, such as sustainable home products brand Bower Collective, said this feature was a huge perk for their subscription-based business model – and allowed them to add necessary levels of complexity to their inventory planning.
Purchasing made perfect
Accurate forecasting leads to more informed purchasing, and our research found that Inventory Planner customers certainly make good use out of the features that make purchasing easier. With improved purchasing processes, our customers said they purchase more often, avoid the risk of stockouts and are able to order in line with shifting lead times.
Accurate, automatic purchasing recommendations
Purchasing in small batches, more frequently, is a great way to boost cash flow – less risky than making a huge order per season, for example. However, creating purchase orders manually takes time that a lot of retailers don’t have. With Inventory Planner, purchasing recommendations are automatic, meaning teams can make more-informed purchases, more often. Users can also set different frequencies for different types of products, and see from the data what should be reordered first when purchasing budgets are limited.
An overstocked inventory can become a huge problem for online retailers, as misaligned purchases, slow-selling variants (such as different sizes or colors) or outdated products start to build up in the warehouse – causing a dangerous cash flow problem. Even big name retail giants such as Walmart and ASOS have fallen victim to this issue in recent years.
Inventory Planner flags slow-moving items constantly, and users can set up regular overstock reports to be sent at their desired frequency, which highlights potential revenue loss if these items aren’t shifted. In our research, e-comm retailers said this was a game-changer when it came to streamlining inventory for improved profitability.
Thanks to Inventory Planner’s powerful overstock insights, vegan protein powder brand Kos released $1.5M from excess stock – which has been reinvested in growth.
“Using Inventory Planner, we were able to cut out ‘days of outstanding inventory’ in half – which freed up around $1.5M,” said Kevin Dalaeli, President and COO of Kos. “The non-replenishment tag in Inventory Planner is super helpful in that, and we can make educated decisions rather than guess.”
Robust, reliable reporting
When growing your retail business, you’ll want to make informed decisions that are targeted towards reaching your goals. In the research, our customers lauded the use of Inventory Planner’s in-depth reporting functionality as a key factor in using inventory to move them towards KPIs.
There’s so much to factor in when creating a slick, streamlined inventory that drives profits rather than blocks cash flow. Many Inventory Planner customers cited the Open-to-buy (OTB) planning feature as fundamental in fueling their inventory strategies. OTB helps planners make sure they have enough stock on hand to meet future demand.
The industry-leading feature is a favourite for fashion brands who are constantly changing their products. It not only aligns your buying budgets with current inventory levels and incoming demand, but it includes customization options to suit your priority goals right down to category level, meaning retailers can constantly introduce new products as opposed to reordering existing product lines.
Over 200 custom reporting metrics
Inventory Planner offers a roster of metrics to analyse your full inventory data – over 200 – to align with your next business moves. By having this choice of metrics and in-depth reporting at their fingertips, retailers said they’re able to make purchasing choices that are directed exactly towards their business needs.
Richard Odeze, Financial Director for apparel brand Maniere de Voir, uses Inventory Planner to effectively manage their bottom line – creating an efficient cash flow model that propels the brand towards long-term growth.
“The reports can be formatted in a couple of clicks so that they’re custom to your specific KPIs,” says Richard. “We use them to identify bestsellers, slow-movers, to review pricing, identify revenue loss and more.
“We could use spreadsheets for this and do it manually, but it would take way too long. Shopify is an incredible app but it was never built with a financial perspective in mind – whereas Inventory Planner seems to understand generally accepted accounting rules and is built on those foundations.”
To see how Inventory Planner’s industry-leading features can help your business create a streamlined, profit-driven inventory, get in touch with Inventory Planner by Sage.