Omnichannel sales are a popular trend among eCommerce sellers, and for a good reason: Building a presence on multiple platforms exposes your brand to more audiences and so opens more opportunities to sell. That being said, managing goods spread across stores like Target, Walgreens, and CVS can create a mess of inventory stockpiles that are challenging to track, manage, and replenish.
The good news is, with real-time data, a central inventory management system, and the help of a 3PL, retail replenishment can be seamless. The following best practices for effective replenishment will ensure the process runs smoothly, rather than eat up your precious time.
Consider your stocking strategy
Companies can choose from several reorder and stocking strategies, with options like just-in-time and buffer stock being popular. However, there’s no one-size-fits-all solution; you’ll have to consider your industry, supply chain reliability, risks, and potential disruptions and their likelihood, then tailor your strategy accordingly.
To balance a just-in-time restocking strategy with maintaining buffer inventory, you need to look at your data regularly, consider external data factors, and review the reliability of your suppliers.
If you’re at a higher risk of supply chain or transport disruptions, buffer stock is essential. You can keep this inventory at a 3PL warehouse for distribution and replenishment to your retail points. That’ll reduce total costs while ensuring you face fewer risks in case a supplier or shipping disruption puts fulfillment on hold.
Create an intelligent and automated reorder strategy
Your reorder strategy has to cover several data points, including:
- Lead time from supplier (the time from submitting an order form and to goods arriving at your warehouse), plus potential delays
- Time to prep goods and distribute them to retail points
- Rate of sale
Consider this scenario: It takes your supplier seven days to ship items to your warehouse from the factory; you work with MyFBAPrep, which has a product prep window of up to 72 hours; and you need an additional two days to ship goods to your retail points. That means your reorder point would be roughly 12 to 14 days before you run out of stock.
Automating alerts and reorder points triggers the submission of order forms the moment stock reaches a certain level at your current sales velocity. You can also tweak sales alerts on your own platforms as well as Amazon for individual auto-replenishment.
Ideally, try to align your replenishment periods. This way, you restock from different suppliers in a single inbound shipment that you can then break up in your warehouse to replenish all your retail stores at once.
Track inventory in real time
Supply chain visibility means knowing where products are at every stage of the buyer’s journey. Real-time inventory tracking combines transportation management with inventory and warehouse management to show you goods in transit, in your warehouses, and across your retail and eCommerce locations.
That comprehensive overview also provides:
- Visibility into manufacturing and lead times per product
- Real-time cargo tracking and insights into customs and compliance requirements
- Notifications about delays or holds
- Alerts when products enter the warehouse, as well as their state of prep
- The geolocation of inventory, including in the warehouse
- Complete inventory visibility, plus that of each stockpile, warehouse, or retail location
You need to be able to access all or most of this information from a single dashboard. That means embracing a central inventory management system to pull data from your warehouse and transportation management systems. Use either an API or a system with existing integrations so everything’s in one place for easier tracking.
Distribute warehousing geographically
For most eCommerce stores, it’s unfeasible to move goods directly from port to retail stores. Instead, you need an intermediate step of warehousing and product prep, which could include inspection, repackaging, bundling and kitting, and branding. You then have to ship the items to retailers at geographically diverse points. It’s therefore important to work with a 3PL that can distribute warehousing or break up inbound pallets into boxes going in multiple directions.
Automate where possible
Automation increasingly enables smooth and cost-effective warehousing, inventory, and replenishment. Further, it can fit into nearly every stage of your retail replenishment process in the form of:
- Automated reorder points based on inventory data
- Automated pick to reduce errors and friction
- Box and shrink-wrap machines to speed up prep (e.g., MyFBAPrep helped Slate cut eight days from their product prep, slashing lead times for Amazon replenishment)
- Automated order processing to issue alerts and automatically move inventory from one stockpile to the next
- Scanning goods into and out of places for automatic location, transport, and tracking
When you can automatically update inventory location during travel when an item’s scanned onto a truck, you eliminate the need for manual labor, while ensuring supply chain visibility. Scanning goods into new warehousing offers similar efficiencies. Of course, you’ll need the right software as well as a 3PL and retail points that work with your scanners to achieve this, so you may have to invest in building an API for your retail partners.
Work with a reliable 3PL
3PL handles more than half of all warehousing and shipping. However, you need a provider that can also accommodate your retail replenishment needs, including visibility into the supply chain, product prep, breaking down shipments to resupply retailers, and geographic distribution. Some value-added services to look for are custom labeling and branding so you can meet individual retailer guidelines for boxing while adding your own unique labels to build brand awareness, such as when using FBA labels.
Your 3PL can streamline your procedures, provide custom equipment and machinery, and deliver professionalization and software to optimize your processes, but you have to pick a trustworthy partner to make that happen.
Wrapping up — Boost your replenishment game with smart strategies
Omnichannel selling allows you to access multiple audiences, spread risk over multiple stores, and generate more sales. However, it also increases the risk of stockouts and often forces split inventory. To avoid those problems, take steps to ensure real-time visibility into inventory, automate replenishment, and hand prep and fulfillment off to a professional third party. With a robust, data-backed restocking strategy, you’ll make the entire process seamless.
Tom Wicky
Co-Founder / CEO
https://www.linkedin.com/in/tomwicky/
About the Author
Tom is an entrepreneur, startup advisor, and management consultant with over 20 years of senior management experience. He is the Co-Founder and CEO of MyFBAPrep, the largest worldwide 3PL ecommerce warehouse network. He managed the digital assets of local media companies across Europe as part of a $2 billion private equity investment led by Macquarie Bank. At the beginning of the Amazon FBA Marketplace, Tom built a data automation platform used to programmatically generate, manage, and optimize over 1 million product listings on Amazon. He is a Boston sports fanatic and a recovering hot sauce junkie. Tom speaks Spanish and German and lives in Florida with his wife and three children.