1. Inventory Mismanagement
A study taken by PricewaterhouseCooper showcased that in 2021 “Consumers (in the UK) on average spent £433 on Christmas, a 7% increase on last year”. Perhaps not a significant number but, in reality, retailers were still caught short with inventory demand of certain items in various verticals. PwC highlighted that due to the pandemic and lockdowns, there was a shift in total revenue percentage with high ticket items decreasing and home accessories and seasonal items increasing. This trend, however, left some retailers with a mixed bag and consequently stock shortages in different verticals.
When correctly employed, ERP solutions like NetSuite can utilise out of the box features such as cycle counting (the automated process of counting items in a designated area) to ensure that retailers have enough stock in their warehouse reserves to keep up with consumer demand. Inventory mismanagement can be incredibly costly and resource-draining, so having checks and balances in place in the run-up to a peak period is an excellent practice for retailers to avoid these mistakes.
2. Not having a system robust enough to handle increased traffic and demand
According to a recent study given by Forrester Research, “approximately half of all ERP customers are on releases that are two versions behind the current release, which may be four or more years old”. Despite the pandemic causing an overall decrease in total retail footfall, the shift in the percentage of total eCommerce revenue compared with actual brick and mortar stores has been significant. Data taken from a report by Insider Intelligence predicted that total retail eCommerce sales will hit highs of $7.391 billion by 2025, up from $4.248 billion in 2020. This skyrocket in sales is due, of course, to eCommerce becoming a part of the everyday shopping habits of billions around the world. It is undoubtedly fascinating (and slightly worrying!) to see large companies behind the eCommerce boom curve. Many businesses may be missing out on increased revenue due to a poor choice of ERP solutions to guide their business operations, especially in peak periods.
Ditching legacy ERP solutions and replacing them with a cloud-based adaptable platform such as NetSuite means that it can be constantly updated with new, exciting features that keep the retailer at the forefront of the eCommerce industry. These new features equip businesses with the tools necessary to scale at will and handle the demand of a new generation of shoppers within the commerce space.
3. Lack of Preparation and Forecasting of Trends
The pandemic has highlighted the importance of retailers to be prepared for any eventuality and to have the right tools at their disposal to make critical decisions based on real-time business insights. According to data given by the British Retail Consortium (BRC), “Total retail footfall in the UK for 2021 fell by 33.2% on a year-on-two-years (Yo2Y) basis”. Companies using an ERP platform such as NetSuite give themselves the tools to prepare for any eventuality. In this case, NetSuite can offer the business a real-time overview of all the company’s operations. If there are any anomalies in the data produced, they can make impactful decisions based on the data to save resources and allocate appropriate spending.
4. Slow / Lack of Returns & Refund Process
In 2021 upwards of $761 billion worth of products were returned in the US retail space – this makes up 16.6% of total US retail sales! With such a radical change in the way consumers shop, this number is not particularly shocking, specifically in the fashion vertical where trying and returning clothes for size and style is a commonly accepted practice. Yet what may surprise you is the number of consumers who stated their willingness to buy from a retailer that offered an easy returns process. From a survey conducted, “92% of consumers surveyed said that they will buy again if the product return process is easy whereas 79% of consumers want free return shipping.” A figure this high highlights the importance of having a rock-solid returns process for companies that aim to develop a healthy and loyal customer base who will repeatedly purchase their products.
With the help of a solution such as NetSuite’s Returns Management Software, companies can use the all in one platform to their advantage and streamline the returns process by notifying all relevant roles, in real-time, of the product in its returns lifecycle. Also, because of NetSuite’s heavy focus on automating business processes, a returns feature that can help retailers save time and resources is the automation of the customer refund management process. Regardless of the reason behind the return, NetSuite’s automation ensures that all the necessary steps are taken to ensure the optimal outcome for the consumer and company through the setup of approved workflows.
ARE YOU HOPING FOR A MORE SUCCESSFUL PEAK PERIOD 2022? THEN SPEAK WITH ONE OF OUR RETAIL EXPERTS TODAY!