How To Optimize Inventory Management And Dig Out Profit Points

With the rapid rise of e-commerce in China, the retail format has undergone tremendous changes.

On the one hand, thanks to the growing maturity of the electronic commerce platform and technology, online shopping has become an easy and convenient shopping option. On the other hand, the continuous improvement of the logistics system has become a reality.

According to the "2014 China Economic summary" issued by the National Bureau of statistics, the total retail sales of the whole country amounted to 27898 billion yuan in 2014, an increase of 49.7% over the previous year.

When more and more people are benefiting from the convenient shopping experience brought by online shopping, the problem of return has always been a problem for businesses.

In the double 11 all the people rob, the volume of trading hurricane, at the same time, the return rate of each electricity supplier is high.

For retailers, the word "return" is enough to give them a headache.

From the overall perspective of supply chain,

It is considered that return is an important part of the entire supply chain. Today, when shopping choices are more diverse, it is an important issue for retailers to further optimize inventory management and mine potential profit points.

The properly processed return and replacement process will not only become the competitive advantage of enterprises, but also will become an effective way to improve customer satisfaction and loyalty.

Shopping is becoming more and more convenient, and shopping channels are becoming more complex and diverse.

The concept of return only meant that consumers would return goods to local stores.

The way has become more diversified: online shopping goods can be returned at the physical store, the goods from the shop can be returned online; the goods purchased at a store can be returned at another store; online orders can be placed, stores are shipped, and returned to the distribution center when returned, all of which are not enumerated.

As more and more consumers shop in virtual shops such as online stores, the problem of return management is becoming increasingly prominent.

According to the report released by China Consumer Association, the number of complaints about online shopping in 2014 was close to 20 thousand.

Although retailers are very clear about the need to reprocess the returns to minimize waste, many of them still do not know how to pport and redistribute products in the best way to optimize profitability.

Nowadays, when goods flow from multiple channels to the return system, returns have become a very complicated process, including sorting, inspection, repackaging, re labelling, redistribution and re sale.

The challenge is how to check returns through all these channels, and redistribute the supply chain and sell the goods as quickly as possible.

It depends on the retailer's Cross sectoral integration of the operating system and the comprehensive understanding of inventory, so that retailers can realtime understand where the goods are available for sale.

However, the overall global view of acquiring inventory is only half the success of the return war.

If retailers want to put these returns in a larger inventory framework, they must use advanced order management software to achieve full visibility of inventory.

If an appropriate solution is adopted, the retailer can automatically estimate whether the recent return is located at the place where the best order is executed or when the new order is added, or whether the order should be executed through another channel, so as to maximize the profit.

In the final analysis, returns are only one of the factors that complicate the problem of inventory balance in multi-channel retailing.

Through intelligent management of orders, retailers can control the cost of redistribution, and make the return of goods sold at the original price as much as possible at a more cost effective place of order execution.