It’s the new norm: customers want what they want when they want it. And if a business can’t offer it to them, they’ll move on to the next. Sometimes it seems almost impossible to keep up with the technology that is constantly changing the playing field. Customers are demanding easy access to products, quality service, and fast delivery – without paying more.

While most companies are able to adapt technology and offer customers new channels from which to purchase, many fail to fully integrate those channels into the bigger picture. They spend countless amounts of time, money and resources to fulfill orders using antiquated systems that can’t keep up. But, businesses that embrace omnichannel distribution and employ a system capable of dealing with the ever-changing marketplace are able to maintain profit levels while providing a seamless shopping experience — whether the customer is shopping online from a desktop or mobile device, by telephone or in a brick and mortar store.

The Domino Effect

Omnichannel is not just about receiving orders from multiple channels. It’s about optimizing the entire supply chain. As point of sales (POS) increase, so too will point of fulfillment (POF) and point of returns (POR). Let me explain…

Sales are technologically driven. Customers will always want to use new technology (like iPads and cell phones) to purchase products with as little hassle as possible. There’s no getting around it.  In order to compete, businesses have to provide new POS options as they unfold. The challenge in this is that every POS needs to integrate with existing ERP software, which often times hasn’t evolved enough to handle the new channels. Flexibility is essential.

Just as customers expect the ordering process to be easier, they also expect delivery to be faster.  Technology affects this as well and opens up a plethora of new POF alternatives to ensure that stock is available as close to the customers as possible, thereby shortening lead times. If a business has a good handle on where stock is located at any given time, they can react quickly with less expense. For example, rather than ordering a part from an external supplier or manufacturer, one could look within his/her own supply chain.  Parts that may be considered obsolete in one region may be directly shipped from a warehouse in another.  Another way to look at it: obsolete stock collecting dust in one warehouse can be redistributed to an area where the parts are still in high demand. Not only does this make products more accessible but it also frees capital that would otherwise be tied up in excess stock.

The next thing to think about is the return process. If a customer purchases via one channel, the customer will also need to be able to return it through the same. Or, to make things more complicated, the customer could mix and match channels. Perhaps a product is purchased online and the customer wants to return it to a store in person. The reverse flow of a return must be developed in the same way as the normal supply chain to preserve as much profit as possible in today’s competitive environment.

Managing the Challenge

In order to effectively manage the omnichannel challenge, businesses need to see the entire supply chain from end to end. Every part of a process management solution must adapt as demand changes over time; and each individual part of the system must integrate with the others. After all, full optimization cannot be achieved without considering how one process affects another.

A good inventory management system can furnish relatively accurate demand forecasts that are crucial to making sure the right items are at the right place at the right time. It can also generate useful data to help decide where fulfillment points should be established at a global level to, ultimately, minimize overhead and improve customer service.

But because forecasts won’t always be correct (demand is never static), an integrated distributed order management (DOM) solution can augment inventory management efforts and improve efficiency even more. DOM allows a business to automate the selling and fulfillment process with the aid of advanced configurable logic. As data flows through it, the software actually becomes more intelligent.  It helps ensure customers are always served in the best possible way by finding available stock and redistributing it or placing urgent orders with locations capable of delivering on time. DOM also facilitates reverse logistics when orders are returned.  And, it provides  insight as to where orders are more likely to come from in the future.

What It All Means

Customers always expect more. So, finding ways to optimize the supply chain to accommodate an omnichannel approach is really the only way to continually achieve revenue goals and maintain profit levels.  If done correctly, the entire quote to cash lifecycle can flow seamlessly allowing businesses to:

  • Respond faster to customer demands
  • Minimize lead time
  • Handle returns more efficiently
  • Reduce shipping/transportation costs
  • Improve customer service
  • Increase profits

Syncron knows how to tackle the omnichannel challenge.  To start a conversation and learn more, email me or call 855-298-7245.