What is “one inventory” across all channels?

Omni-channel "one inventory" is an important trend in the digital transformation of the retail industry. It integrates the commodity inventory of all online and offline channels to achieve unified management and scheduling, so as to improve inventory utilization efficiency, reduce operating costs, and enhance customers' shopping experience.

Teacher Bao's comments:

A single inventory of goods is an important infrastructure that needs to be built first in the current transformation of corporate marketing models.

A batch of goods has three important value ranges:

First, unified delivery across all channels: Solve the problem of unified delivery offline and online. Help enterprises build a more efficient omni-channel marketing system. Improve delivery efficiency and user experience, and reduce delivery costs;

Second, one product for multiple channels: solving the problem of how enterprises can better adapt to the current changes in channel diversification and fragmentation, and improve the overall marketing efficiency of enterprises;

The third is to change the efficiency and cost problems existing in the traditional distribution model: break the problems caused by the integration of "things" and "rights" in the traditional distribution model, realize the separation of "things" and "rights", improve the efficiency of the use of goods and funds, promote the improvement of the company's marketing efficiency, and reduce marketing costs.

The overall transformation is a change that must be achieved in the transformation of corporate marketing.

With the rapid development of the retail industry and the increasing diversification of consumer demand, companies are facing problems such as inventory management difficulties, inefficient order processing, and poor supply chain coordination.

The emergence of the omni-channel unified inventory model provides a new approach to solving these problems. The omni-channel unified inventory model is one of the important trends in the digital transformation of the retail industry. It breaks the boundaries of traditional retail, integrates the inventory of goods from all online and offline channels, and realizes unified management and scheduling.

01 What is omni-channel unified inventory?

All channels have one inventory, which means that the inventory of goods from all online and offline channels is integrated to achieve unified management and unified scheduling. This model breaks the boundaries of traditional retail and allows consumers to purchase their favorite goods at any time, any place, and through any channel.

The core concept of omni-channel unified inventory management is to centrally manage all inventory resources of the enterprise to achieve unified inventory allocation and optimization. This strategy allows enterprises to flexibly allocate goods between different sales channels (such as online shopping malls, physical stores, mobile applications, etc.) to meet the needs of consumers in different channels.

Take a clothing retailer as an example. They may have multiple stores across the country and an online store.

By implementing the omni-channel one-stock strategy, when a customer places an order for a piece of clothing online, the system will automatically check the inventory of all channels, select the nearest warehouse or store for delivery, and even allow consumers to choose to pick up the goods at the nearest store. This not only improves the efficiency of inventory utilization, but also enhances the customer's shopping experience.

The core features of omni-channel one-stop shopping are mainly four points:

1. Inventory sharing:

All sales channels can share the same inventory, ensuring real-time update and accuracy of inventory data.

No matter which channel the customer places the order from, they can immediately know whether the product is in stock.

2. Cross-channel selling:

Goods can be sold on any channel without restriction.

For example, customers can place an order online and choose to pick it up at the nearest physical store, or buy it directly in the physical store.

3. Inventory Optimization:

By centrally managing inventory, inventory resources can be allocated more efficiently, reducing inventory backlogs and out-of-stock situations.

Use data analytics to forecast demand and dynamically adjust inventory levels.

4. Flexible delivery options:

Provide multiple delivery options such as order online and pick up in store (BOPIS), order online and deliver to home, return to store, etc.

Customers can choose the most suitable option based on their needs and preferences.

02 How to implement operational transformation of the unified channel inventory?

1. Core content of operational transformation

(1) Centralized inventory management:

Centralize the inventory of online and offline products in a shared inventory pool to achieve unified management and allocation of inventory. This helps to maximize the use of inventory resources and avoid inventory backlogs and out-of-stock situations.

Through the intelligent inventory management system, the inventory status can be monitored in real time, and the inventory strategy can be dynamically adjusted according to sales data and market demand.

(2) Order routing optimization:

According to the company's business layout and business model, the optimal order routing distribution rules are set within the system to ensure that goods can be delivered to consumers in the fastest way.

Utilize advanced algorithms and big data analysis technologies to optimize order processing procedures and improve order processing efficiency.

(3) Supply chain collaboration:

Achieve close collaboration among all links in the supply chain, including suppliers, manufacturers, distributors, and retailers, to ensure smooth information flow and resource sharing.

Through the digital platform, seamless connection and real-time interaction between all links in the supply chain can be achieved, thereby improving the response speed and flexibility of the supply chain.

(4) Improved customer experience:

The omni-channel unified shopping model provides consumers with a more convenient and efficient shopping experience. Whether shopping online or offline, consumers can enjoy unified product information, prices and services.

Through data analysis and personalized recommendation technology, we provide consumers with more accurate product recommendations and shopping suggestions, thereby improving shopping satisfaction and loyalty.

2. The value and impact of operational change

(1) Improve inventory utilization: By sharing inventory resources, companies can maximize the use of each item and reduce inventory backlogs and waste.

(2) Reduce operating costs: By optimizing inventory management, order processing, and supply chain collaboration, companies can reduce operating costs and improve profitability.

(3) Improving customer satisfaction: The omni-channel one-stop shopping model provides consumers with a more convenient and efficient shopping experience, helping to improve customer satisfaction and loyalty.

(4) Enhance market competitiveness: Through digital transformation and the implementation of an omni-channel one-stop service model, enterprises can build unique competitive advantages and enhance their market competitiveness.

3. Challenges and solutions for operational implementation

(1) The construction and upgrading of the technology platform requires a large amount of human, material and financial resources.

(2) The increasing complexity of inventory management requires the establishment of more complete management systems and processes.

(3) Coordination and cooperation with e-commerce platforms need to address issues such as data sharing and profit distribution.

4. Corresponding solutions

(1) Increase investment in technology research and development, introduce advanced digital technologies and tools, and improve the performance and stability of the technology platform.

(2) Establish a sound inventory management system and process, and strengthen the regularization and standardization of inventory management.

(3) Strengthen communication and cooperation with e-commerce platforms, establish mutually beneficial and win-win cooperative relationships, and jointly promote the implementation and development of the omni-channel one-stop shopping model.

03 How to digitally transform omni-channel sales?

The digital transformation of omni-channel and integrated sales is a complex and systematic process that involves multiple links and departments within the enterprise, as well as the collaboration of external partners. The following is an explanation of how to transform omni-channel and integrated sales digitalization from five key aspects:

1. Clarify transformation goals and strategies

(1) Determine transformation goals: Companies must first clarify the specific goals of their omni-channel digital transformation, such as increasing inventory turnover, reducing operating costs, and improving customer satisfaction.

(2) Formulate transformation strategy: Based on the transformation goals, formulate a detailed transformation strategy, including technology selection, system construction, process optimization, personnel training, etc.

2. Build digital infrastructure

(1) Establish a unified inventory management system: Use an advanced inventory management system to achieve real-time synchronization and unified management of online and offline inventory. The system should have functions such as inventory early warning, intelligent allocation, and data analysis to support the company's inventory decision-making.

(2) Upgrading the order processing system: Optimizing the order processing process to achieve rapid response and efficient processing of orders. By introducing intelligent algorithms and big data analysis technology, the accuracy and efficiency of order routing can be improved.

(3) Build an omni-channel sales platform: Build or upgrade the existing sales platform to ensure seamless integration and consistent experience between online and offline channels. The platform should have functions such as product display, online payment, logistics and distribution, and support unified processing of multi-channel orders.

3. Optimize supply chain collaboration

(1) Strengthen information sharing among all links of the supply chain: Through digital means, information sharing and collaboration among suppliers, manufacturers, distributors, retailers and other links of the supply chain can be achieved. This will help reduce information asymmetry and communication costs, and improve the response speed and flexibility of the supply chain.

(2) Introducing a supply chain collaboration platform: Use a supply chain collaboration platform to integrate supply chain resources and optimize supply chain processes. The platform should have functions such as order management, inventory management, and logistics management, and support multi-party collaboration.

4. Improve customer experience

(1) Achieve consistent experience across all channels: Ensure that consumers can enjoy consistent product information, prices, and services in any channel (online or offline). Realize real-time synchronization and sharing of omni-channel data through digital means.

(2) Personalized recommendations and marketing: Using big data and artificial intelligence technologies to analyze consumers’ shopping behaviors and preferences, and provide personalized product recommendations and marketing services. This helps improve consumers’ shopping satisfaction and loyalty.

5. Strengthen data-driven decision making

(1) Establish a data analysis system: Build a complete data analysis system to collect and analyze sales data, inventory data, customer data, etc. from all channels. Through data analysis, potential problems and opportunities can be discovered, providing strong support for corporate decision-making.

(2) Cultivate a data-driven culture: Cultivate a data-driven culture within the company and encourage employees to use data to make decisions and optimize their work. Improve employees’ data awareness and data analysis capabilities through training and guidance.

04 Successful Case of Omnichannel One-stop Shopping

There are many cases of omni-channel one-stop shopping transformation. The following are some representative cases that show how different industries and companies achieve digital transformation and business growth through the omni-channel one-stop shopping model:

1. Skechers

(1) Background: Skechers has surpassed Adidas in the United States to become the second largest sports brand in the country, with hundreds of online stores.

(2) Transformation measures:

80% of the national inventory is shared. Different channels (such as online new goods channels, clearance channels, offline flagship stores and outlet stores) lock the inventory during specific periods, but most of the goods are shared.

Through the omni-channel one-stop shopping model, the efficiency of merchandise personnel has doubled, and while performance has increased, the annual procurement volume has been significantly reduced.

(3) Results: Significantly improved inventory turnover and operational efficiency, and reduced procurement costs.

2. Yishang Yujie (P&G distributor)

(1) Background: P&G is the world's largest distributor, with a huge order volume, reaching more than 20 million orders during the Double Eleven shopping festival.

(2) Transformation measures:

Introduce an omni-channel system, connect all businesses to a unified system, and achieve rapid processing and delivery of orders.

Solve the problem of gift loss caused by ranking purchases (gifts given to the top 1,000 or 10,000 consumers) and reduce the accidental gift giving through system optimization.

(3) Results: The technical pressure during the Double Eleven period was greatly reduced, order processing efficiency was improved, and gift management became more precise.

3. Semir

(1) Background: There are many online stores with complex brands, including own brands and agency-operated brands.

(2) Transformation measures:

Adopt a pre-sale sinking strategy, but only for online VIP customers, to improve pre-sale efficiency and reduce return risks.

Unify online and offline systems to achieve unified management and rapid circulation of multi-channel orders.

(3) Results: E-commerce performance has increased 45 times for 10 consecutive years, and operational efficiency has been significantly improved.

4. Adopt a Cow

(1) Background: A new and cutting-edge brand that operates stores on more than 70 e-commerce platforms nationwide and has more than 2,000 offline stores.

(2) Transformation measures:

Introducing an omni-channel unified inventory system to achieve automatic processing of 95% of orders.

Optimize the order processing process and reduce the logistics cost of each transaction by 30%.

(3) Results: Order processing efficiency has been greatly improved and logistics costs have been significantly reduced.

5. Ande Zhilian and Feihe Milk Powder

(1) Background: Annto Intelligence implemented an omni-channel integrated inventory project for Feihe Milk Powder in South China.

(2) Transformation measures:

Multi-channel inventory sharing management and online and offline linkage.

Optimize inventory turnover and logistics efficiency, and improve the accuracy of supply chain planning.

(3) Results: Inventory turnover efficiency increased by approximately 30%, labor efficiency increased by 15%, the overall efficiency of logistics equipment increased by 20%, and overall delivery satisfaction increased.

Conclusion

The omni-channel one-stock model has been successfully applied in different industries and enterprises. Through measures such as inventory sharing, unified order processing, and system optimization, enterprises can significantly improve operational efficiency, reduce costs, increase customer satisfaction, and maintain a leading position in the fierce market competition.

The operational transformation of omni-channel and unified inventory is an inevitable trend in the digital transformation of the retail industry. Enterprises need to actively embrace this trend, strengthen technological innovation and management innovation, and continuously improve their digital capabilities and competitiveness.