July 31, 2018

What Does Real-Time Mean in Retail?

Written by
Justine Cross

We are living in an “instant gratification” era, and the way we shop is evolving. Big box retailers like Amazon and Next are proving every day that consumers can have items they’ve bought online speedily. Same day and next day delivery are now very much the norm.

In fact, 46% of millennials are willing to pay more for same day delivery in order to fulfill their need for instant gratification. But this poses a challenge for smaller retail businesses. How can they possibly compete with these larger retailers who are conditioning consumers to expect this level of service?

Business efficiency is now more important than ever

It’s all related to how efficient retailers are, both with how their front-office operates, and how efficient they are behind every click of the buy button.

Real-time retail becomes a vital cog in every business, ensuring they can keep up with consumer demand and not fall behind other retailers.

Yet a study by Forrester claims that while “67% of retailers consider overall business operations efficiency to be of high or critical importance, only 27% consider themselves able to manage this well.”

There’s a huge need for real-time retail

In order to compete successfully and gain efficiency within any modern-day retail business, there are a set number of processes that should either be in real-time or as close to real-time as possible. These are:

  • Updates to inventory availability
  • Spotting inventory errors in the warehouse
  • Updates to accounts ledgers

Whether retailers take sales by phone, in-store, online or on the road, they should be able to maintain an accurate view of their inventory across channels, at any time of the day.

This is the case when keeping inventory levels updated as they purchase and sell goods and if their staff spot inventory errors in the warehouse. Both processes hinge on real-time inventory management.

Before the introduction of cloud-based and real-time systems, inventory errors would ordinarily only be spotted when performing stocktakes or when products have already been oversold. In other words, retailers were too late.

Today, it’s much easier to maintain an accurate view of inventory. As mentioned, instant inventory updates play a large part in this, but this also negates the need for full-scale stocktakes every month.

Instead, warehouse staff can focus their efforts on counting items that are high value, ones that historically have had inventory discrepancies in the past, or when their real-time systems are alerting them to certain products they need to investigate and potentially recount. This slight change of process, matched with reliable inventory management software, ensures that any discrepancies are found in near real-time.

Financial management is another area that must be in real-time.

Making the right decisions in a retail business – whether choosing which products to re-stock, which territories to expand into, or whether they need to change suppliers in order to reduce costs – all require accurate data that spans their entire business.

And accurate data is only achievable if they have systems in place that are able to cope with updating their accounts ledgers automatically and instantly.

How do systems and technology play their parts?

The business management vendor landscape is booming.

Many systems promote real-time inventory, warehouse and financial management as part and parcel of their service, particularly when considering full-scale ERP systems. And this is certainly a necessity within today’s competitive climate.

However, real-time retail runs deeper than that. Automation technology for back-office functions is what is really going to set retailers apart from their competitors. Real-time commerce and the concept of real-time in retail then becomes – quite simply – automated retail.

And when working under this heading rather than just real-time retail, other back-office and retail functions speed up. Things like order fulfillment, shipping and dispatch emails, purchasing new products, cross-sell, upsell and marketing promotions all become data-driven and automated.

Therefore, there’s no denying that automation allows retailers to bring balance and harmony to the front-end of their business and the back-office. It enables them to create back-office efficiencies, freeing them to focus on business growth and reacting to the challenges of the “instant gratification” era we currently find ourselves in. Quite simply, automation technology covers the mundane and essentially boring tasks that all retailers need to do, while allowing them to focus more of their time and energy on what they loved about retail in the first place.

Justine Cross is the Content Marketing Executive at Brightpearl – a cloud-based back-office solution for retailers and wholesalers. Brightpearl allows you to provide a truly world-class experience for your customers, whilst unifying all of your sales channels, inventory, accounting, CRM, suppliers, fulfillment, warehouse management, reporting and POS in one single automated system.