Trying on Order Management Technology

5/15/2013
In today's competitive multichannel environment, apparel retailers would benefit from recognizing how order management technology can be used to capture, integrate and utilize data across the entire operation to better understand and respond to consumer demands. The right system can simplify day-to-day operations, giving apparel retailers more time to keep up with fashion trends to aid in retaining and attracting customers to build the business.

Multichannel order management systems do more than automate order entry and processing from a variety of sales channels—they also provide shopping cart integration, selling tools, Payment Card Industry (PCI) compliance, fraud protection, inventory management, payment integration, customer management and order fulfillment capabilities. Apparel retailers need to ensure that orders from all channels are automatically captured and centrally staged. Visibility into this process provides the controls they need to eliminate multiple data entry errors that can occur while seamlessly integrating business operations into a single, efficient workflow from shopping to shipping.  

Inventory: When is enough, enough?
Having up-to-date inventory is a crucial element of success for apparel retailers, which is being driven by high-tech supply chain management systems along with price pressure from major discounters. Retailers benefit from keeping close tabs on every item in their inventory — understanding what items have sold in each department, by category, by season, style, size, color or any other variable.  Knowing when to reorder and restock those fast-moving items is just as important as knowing when to discount or drop items that don't sell.  Keeping up with the fickle fashion demands of consumers is not an easy task, and inventory tracking needs to be simplified, streamlined and automated.

An order management system that fully integrates true, real-time inventory movement with sales by client allows retailers to respond quickly to changing market and fashion demands, enabling them to take the guesswork out of merchandising and planning for future marketing activities. 

With an automated inventory system, retailers are better equipped to flexibly source inventory and handle complex supplier and multi-supplier fulfillment requirements to better meet customers' demands. Integrating purchasing and inventory management processes enables specialty retailers to establish optimum inventory levels for each item stocked and helps make sure that purchases are made well enough in advance to keep inventory levels where they need to be.

This provides greater inventory control and helps avoid out-of-stock situations.  Whether shipping direct or drop shipping from a warehouse or fulfillment center, crosschannel inventory and purchasing control are essential across all platforms, including third party e-commerce options.

With apparel items especially, a coordinated inventory assortment is vital – missing that matching belt or jacket can cost a retailer a sale and a potential customer.  Integration of purchasing, production, inventory, warehousing, sales and shipping facilitates capturing up-to-date product information at every step in the order process.

In addition to physical inventory items, apparel orders can involve items for which no physical inventory exists, such as personalization or other forms of unique customization.  An order management system enables retailers to manage the flow of items to better control response time, manage inventory allocation and create a quick and seamless process for order fulfillment so they will have the right products, at the right time, ready to ship to meet customers' expectations.

As its inventory grows, a retailer may find that it needs or wants to have multiple warehouses that will get products into customers' hands as quickly as possible.  Automating inventory tracking across multiple warehouses and integrating this with an order management system helps to stage and transfer items between and within retail locations, or online warehouse locations, for more rapid order fulfillment and higher levels of customer satisfaction.

An order management system will also simplify the process of collecting, managing and linking customer information – which can lead to greater customer loyalty in the long run.  Retailers can use their systems to generate target customer lists and develop campaigns and offers to select classes of customers, for example, those who have not ordered in the past six months, or those who have ordered one product but none of the coordinating items.

This enables retailers to create and maintain personal relationships with customers and communicate relevant promotions at times when they are most likely to buy.  Retailers can only capitalize on this if they have captured the right information in their system.

Dressing up back office processes
Once shoppers have selected their items, orders must be processed and shipped.  Multichannel apparel retailers usually have specific demands as far as shipping methods and order processing are concerned.  At minimum, they need to be able to capture and stage orders automatically for all sales channels so that there are no delays in shipment – especially during holiday and gift-giving seasons.  Having a multichannel order management system allows retailers to automatically download new orders from all sources, publish product information and keep inventory synchronized.

Retailers also need to be able to process multiple and mixed payment methods including credit cards, PayPal, store credit, gift certificates, coupons and other discounts that may be applicable.  Being able to automatically queue orders for processing based on available inventory, being able to track the orders by stage – from picking and packing to delivery – and being able to keep shoppers informed every step of the way is one way to differentiate service after an order is placed.

Doing all of this effectively requires full and complete information automatically available from each link in the process - from inventory planning, purchasing and warehousing, to shopping and shipping.  Distribution networks and logistics take on increased importance for the apparel business, along with the ability to integrate inventory from multiple suppliers and locations across all channels to know what is in stock and ready for shipment.

Effective back office order, inventory and customer management, warehousing and payment integration coupled with efficient logistics help apparel and specialty retail operations to utilize technology to drive their business and gain a competitive edge, while providing superior customer service to win and retain shoppers.
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