The retail industry has gone through significant changes in the past few years. Consumer shopping habits have changed drastically over the past few years thanks to the eCommerce boom.
The rise of mobile shopping has blurred the line between physical stores and online experiences. While some legacy brick-and-mortar brands have struggled to keep up with the growth of eCommerce, it is not the end for physical stores.
However, today’s retailers are required to move faster than ever to meet consumer demand as well as to thrive in the industry. To do that, they need greater visibility into their business processes.
One of the technology tools that help retailers gain better insights into their business performance is enterprise resource planning (ERP) software. The software has been well-known for its ability to improve the performance of businesses across various industries, including retail.
Advantages of ERP software in the retail industry
Here are several benefits that ERP software provides to the retail industry.
1. e-Commerce integration
No one can deny the importance of e-commerce in today's retail industry. ERP software enables retailers to integrate their physical stores with e-commerce to optimize the shopping experience.
With an ERP system implementation, your e-commerce website is easier to manage and manage with an efficient ordering process. For example, suppose a customer adds an item to the cart and then completes the payment process. The ERP software then sends a confirmation email to the customer, pulls the item from your inventory data, and proceeds with the shipment.
2. Better inventory management
Inventory plays an important role in increasing the profit margins of a retail business. Having control over your inventory enables you to stock enough to meet anticipated orders.
The retail industry involves fast-moving consumer goods and the demand for these goods can fluctuate every day. An ERP system can address this challenge by tracking your stock levels and movements.
ERP software ensures you know exactly what's in your inventory and what needs to be restocked. It also keeps track of the shelf life and notifies you when a product is about to expire.
In addition, an ERP system has the ability to make accurate forecasts. It helps you analyze customers’ buying trends in the past, thus enabling you to modify the inventory to meet the upcoming demands.
3. Enhanced operational efficiency
ERP software enables retailers to capture, store, and manage information through automated systems to organize and simplify day-to-day operations and reduce the tedious manual effort of performing repetitive activities.
The ERP solution helps retail companies increase efficiency to ensure targets are met on time, thus saving operating costs.
4. Increased customer retention
Through the customer relationship management module, all the records of customers are stored in a centralized platform. This provides retailers quick access to customers’ contacts and addresses, their order history, etc.
By having all your customers’ details centrally maintained, retailers will be able to better analyze their customer behavior and make data-driven decisions from the analysis.
For example, through a customer order history, you can learn the customer’s buying patterns such as the items they purchased, when they usually made purchases, etc. From here, you can utilize those findings to create personalized email marketing campaigns, loyalty programs, promotions, and so on. This will eventually encourage the customer to shop more.
You may also want to read this related article:
5. Improved decision-making
Business information is collected from various subdivisions such as inventory, sales, purchasing, and other processes. Real-time, accurate and relevant information can enable management to make prompt and informed business decisions.
Through a single platform you can have easy access to all information and plan better for competition, changing demand, and other unforeseen disruptions.
6. Better financial control
ERP software provides retailers with greater financial insights like profits and losses across all locations, departments, brands, and even products. The accounting module in the ERP system also enables retailers to make accurate cash flow forecasts, monitor budgets, and track expenses.
With the procurement module, you can set multiple levels of approval for purchase orders so you can have greater control over purchases across all your outlets. With the inventory management module, you can figure out your slow-moving inventory items so you can remove those items from your next procurement list, reducing unnecessary costs.
7. Increased sales & profits
Sales are at the core of the entire retail industry as well. The majority of decisions taken in any retail business are about increasing sales. ERP software comes with features that can help you with this.
Real-time reporting capabilities can help management make timely decisions, to promote their sales. The system provides you with greater insights into which products are selling and which are not, enabling you to decide which products you should promote and which ones you should discard.
It is not an exaggeration to say that ERP software is indispensable for the retail industry, especially given the intense competition today. The system embodies all the solutions that retailers need to facilitate their day-to-day business operations.
Depending on which retail sector you are in, there can be customized solutions designed to fit your unique requirements. For more details about ERP solutions for the retail industry, you may refer to this page.