Tracking, Reporting, and Forecasting Retail Needs
Retailers that don’t carry enough inventory suffer from low sales revenue, while retailers with too much stock suffer from too much overhead. Both types of miscalculation take a heavy toll on profits, which means that prompt and accurate tracking, reporting, and forecasting of consumer demand is critical for retail success.
ERP solutions track transaction information across retail channels in real time, instantly generate and deliver reports and performance metrics, and intelligently forecast future demand curves with unsurpassed agility. After implementing an ERP platform, decision makers in your retail business will gain a much richer understanding of how effectively each department and business unit in your organization contributes to order fulfilment and customer service, both individually and in coordination with each other.
ERP systems enhance all three of these critical processes: tracking, reporting, and forecasting. This post considers how ERP solutions augment each of these processes.
From financial management and accounting to human resources, payroll, and employee scheduling, every aspect of your retail business is important. With an ERP solution, retailers can easily keep track of not just their sales transactions and stock levels, but every aspect of their business operations.
ERP systems track several crucial retail processes, including:
- Sales transactions across all physical and digital retail channels
- Order fulfilment, including cross-channel fulfilment and delivery tracking
- Customer interaction via social media, customer service, etc.
- The effect of promotions, advertising, and marketing campaigns
- Supply chain and distribution costs, replenishment schedules, etc.
Retailers can have their ERP deployment customized even further to track specific activities, variables, and KPIs that are relevant to their particular line of business (apparel & footwear, consumer goods, etc.). Industry-focused deployments of this kind keep track of metrics and relationships using terminology that’s specific to your trade.
On its own, tracking information doesn’t offer much value. After it has been collected, your business data needs to be converted into clear, actionable information. Business intelligence (BI) solutions facilitate informed decision making and give context to your unstructured data. ERP and BI capabilities work in tandem: your BI software analyzes data from your ERP system and presents this single version of the truth as easy-to-understand performance metrics and reports.
Some retail businesses make the mistake of skipping BI integration as a cost-cutting measure, because they think BI is an optional activity. This is certainly not the case, and BI should be a core component in your ERP implementation from day one. Better planning is a primary motivating factor behind implementing an ERP solution. After all, that’s what the “P” stands for!
Tracking information is necessary for generating business reports, and reporting is indispensable for understanding how well your business is performing. However the most successful retail brands understand the limitations of descriptive reports, and insist on analytical tools that can generate projections and perform advanced forecasting. Without such forward-looking analytics, organizations remain firmly entrenched in a passive mode of thinking, and often fail to react to emerging trends in time to capitalize on important opportunities.
BI-enhanced ERP systems use real-time data to automatically perform accurate predictive analyses. Some advanced ERP platforms are even capable of autonomous decision making, and can be authorized to make some choices based on this forecasting without requiring any human intervention. Sometimes a machine that isn’t susceptible to human biases is better for making impartial decisions based on pure quantitative analysis.
Together, ERP and BI can track and anticipate issues brewing on the horizon, like supplier shortages. Your ERP system tracks each supplier’s consistency in pricing and quality in real time. As soon as it detects significant changes in a vendor’s behavior, your BI solution will raise a red flag, allowing you to make any necessary procurement changes before you encounter inventory shortages.
The right ERP solution for retailers adds BI capabilities to its core ERP platform, delivering actionable insights, reports, and predictive analyses that you can use to make informed, data-driven decisions.
Discover how ERP and BI technologies can help your retail business improve planning and decision making by contacting Visionet Systems to schedule your free consultation.