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Your retail & e-commerce warehouses aren't aligned

Let us know if this sounds familiar.

One of our clients, a high-growth retailer, was running into a few problems when it decided to get in contact with us. It was opening new stores in their territory, flexing its retail muscle and, at the same time, was experiencing a marked growth in interest in its online store. This growth of online and offline properties should have been a good thing. But there was a snag. Well, if we’re honest, there were a few snags. 

Issue #1

Its retail WMS wasn’t supporting the smooth growth of its e-commerce division.

Considering that its e-commerce sales lept from 1% of total sales to over 10% in a short period of time, this was a big issue.

It was effectively running two businesses side-by-side. Two warehouse teams, two customer service teams, two different sets of priorities. Which made no sense. It was one business, and should have been operating with one united goal.

Issue #2

The retail and e-commerce arms were both competing for the same inventory. Madness. 

It was nonsense. And they knew it was nonsense. By operating in silos, it was effectively shooting itself in the foot. And ultimately it was the customer who was suffering. Here’s how:

 

1

Mass confusion

Orders went into a black hole. It was impossible to track movement between when they were placed and when they were shipped.

3

Overselling

Because inventories weren’t aligned, it oversold the little amount of stock that the retail warehouse allocated to e-commerce. Bad for business, bad for the customer.

2

Busy call centers

This wasn’t necessarily owing to complaints, more owing to a lack of transparency. Customers didn’t know when they were going to get their orders.

4

Inaccurate orders picked

The way that stock is pulled for stores (in pallets and cases) is vastly different to the way that e-commerce orders are created (in ones and twos). Mix up the processes, and it’s very easy to get it wrong.

3 Things that happen when retail and e-commerce WMS software doesn’t communicate

Complex e-commerce processes are oversimplified

Typically, businesses like the one in our example set up their e-commerce division as an additional ‘store’ to replenish from the main warehouse. 

Doing this means that the complex needs of e-commerce consumers are ignored, leaving the warehouse susceptible to mispicks. 

You've lost the primary function of fulfilment

The main mission of a retail WMS, to connect up with the in-store EPOS, bears no relevance to the diverse needs of e-commerce.

E-commerce should never be an afterthought; you’re impacting individual customer experiences by getting it wrong.

There’s no real-time inventory management

Real-time inventory management isn’t something that should be seen as a nice addition. It’s absolutely essential for e-commerce fulfilment.

It’s the only way that businesses are able to be confident that the quantities of stock listed on their sites is accurate. Huge mistake if they’re not.

The 5 main advantages of combining retail and e-commerce WMS operations

Our chain store retailer knew that it had to change something. These are 5 of the main reasons why it decided to combine its two systems:

 

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There’s an immediate impact on ROI

This is a big one. Improvements to efficiency are nice, but they need to mean something. With two separate systems, our client had to train two separate sets of warehouse staff, they had two sets of supervisors, there was increased technical overhead…combining the two operations erases a lot of the overhead. In terms of revenue, thousands was saved on day one before the shared inventory and accurate fulfilment could even start work on boosting sales.

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Goods-in turns into a breeze

A big time saving here. You don't have to do goods-in twice. In fact, you don't have to do anything twice any more. One joined up team with one joined up goal working with one joined up system means that a tonne of time wastage is completely eliminated. And the management of all of these processes is greatly simplified - no more headaches.

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Inventories are always accurate

An inaccurate and laggy inventory was possibly the main impetus behind our client getting in touch with us. With a combined WMS that prioritises e-commerce needs without negatively impacting on in-store replenishment, it had access to a real-time view of actual inventory counts. By combining the two inventories and eliminating the silos within their warehouse, it now has one unified inventory which has the fidelity and strength to improve fulfilment, boost the customer experience and increase sales.

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The WMS can integrate with all of their existing systems

The biggest thing that can go wrong with any new warehouse technology is integration. If your systems can’t communicate with each other, you’ll run into problems. This was something that our client was concerned about. The key to getting this right is to have a very detailed requirements specification with a minimum of 2 weeks testing. We have an open API for custom systems, and have pre-written integrations in place for the biggest players. We make sure that every integration is completely seamless.

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Investment in a forward thinking, evolving technology

Anyone who works in e-commerce knows just how volatile change can be. While it’s difficult to be prepared for all eventualities, it’s impossible if you’re working with systems that don’t have the ability to change built into their DNA. At Peoplevox, we’re always improving our product offering. We’re always looking at each of our clients’ needs and are constantly developing new ways for the WMS to help them to grow quicker, fulfil faster. You don’t get that with any legacy WMS.