In the first half of this year, the second part of SML's State of Retail Insights Report: Better Serving Customers Through Technology reported that 43 percent of retailers believe that increased visibility into inventory levels helps better serve customers and improves the overall customer experience.
In addition, according to ICHG, inventory overstocks and stock-outs, or inventory distortions as analyst firms call them, cost retailers nearly $1.1 trillion annually globally.
Apparently, controlling inventory is the lifeblood of the retail industry: excessive inventory leads to waste, and low inventory will lead to out of stock and unable to meet consumer demand in a timely manner. Electronic shelf labels are becoming increasingly popular as a way to display and manage product pricing and information. ESL can help store associates manage and control inventory in five ways.
1. Provide consumers with out-of-stock information
ESL works in conjunction with the ERP system to allow shoppers to check if an item is out of stock without having to look for a store associate for help. When an item is out of stock, ESL can even show the date of the next expected delivery.
2. Display inventory details to retailers
In addition to showing inventory levels in the store, back office or warehouse in real time, ESL can also include special numbers, codes to alert store associates to the status of some specific products, additional items. This can help stores optimize their merchandise mix, improve their merchandise turnover, and also dynamically adjust their sales strategies.
3. Ensure reasonable inventory levels
Using the ESL solution, retailers are able to react quickly to inventory levels. The solution can also indicate when to run promotions on seasonal items, thus minimizing losses from price cuts, or when to sell expiring products before they exceed their shelf life, thus reducing perishable losses.
4. Assist store associates in inventory management
With the ESL solution, retailers can display inventory information directly on the display to assist store associates during interactions with customers.
5. Resolve out-of-stock situations in a timely manner
Most out-of-stocks occur at the store level, not at the inventory management level. For example, employees do not respond quickly enough to reduced shelf inventory levels. By linking point-of-sale (POS) data and inventory management tools, ESL can alert employees to low inventory or the need to restock in time to avoid out-of-stock situations before they become a problem.
Ultimately, accurate inventory management implemented using ESL technology can result in significant cost and time savings for retailers and their shoppers.