One of the fastest growing industries is the retail sector. The retail sector is one of the largest sectors that comprises of departmental stores, specialty stores, discount stores, general retailers, etc. However, the retail industry is the one that is responsible for the distribution of finished products to the public.
With the growth process, managing all the areas of the retail industry become a problem. To ease out managing all types of industries, ERP or enterprise resource planning has been introduced. The ERP software systems are also beneficial for running a retail sector smoothly and with ease. Apart from smooth functioning; there are other benefits of the system in the retail industry also.
7 types of significant benefits of ERP for the retail sector:
Real-time business information – Any business decision is taken on the information gathered from different subdivisions like sales, purchase, inventory, and other processes. The real-time business information that is relevant helps the management to take proper and effective decisions. However, synchronizing the data across all the units in a large enterprise is very much difficult. Any discrepancies in business can lead to severe damage to the overall operations of the company.
The ERP system collects and distributes all the real-time information within a single integrated application. The real-time data enables the companies to face the issues that lead to discrepancies and errors and take necessary actions. Planning and control with real-time data help in generating profitability to the companies.
Inventory management – In the retail business, inventory plays a vital role. Managing inventory effectively helps to stock enough to meet predictable orders and removing excesses. Lack of inventory management leads to financial losses as both surplus and shortage of inventory are dangerous for a business, especially in the retail industry.
An ERP software system can address this challenge broadly. In an ERP system, the detailed information about each and every product stored in stock are available and that enables users to know the condition of the inventory and what should be re-stocked. This system also helps in tracking the shelf-life and the expiration period of a product. Also, analyzing past trends and customer purchasing habits, ERP can make demand forecasts.
Customer management - ‘Customer is always right’ is the most common saying in the retail sector. From this adage, one can understand the importance of a customer in the retail industry. An ERP system for the retail sector can be vital in customer management and retention. The information collected through an ERP system, helps retailers to use the purchase history of the customers to analyze their buying trends. This also assists you to create their personalized shopping experience and provide deals and promotional offers to the customers. Customer grievances can also be sorted by using the data from ERP.
Employee management- The retail industry operates via several retail outlets that spread over various geographical locations. So managing the employees of different locations become a challenging task. Using ERP in the retail sector has the benefit of managing employees from any area of the globe. An integrated system is used for managing the employees in ERP system process. Real-time information, like working hours, shift timings, etc. of the employees are being stored in the ERP system. Some vendors also offer a mobile solution to the ERP packages that makes the process more feasible. The main aim of using ERP system in retail industries is to manage the employees effectively and make the communication easier so that handing out new assignments, offering promotions or bonus and tracking goals that have been met or not are smooth.
Integrating multiple channels and e-commerce – In the retail sector, multiple channels functioning simultaneously are required for running a smooth operation. By using an ERP system, the integration of multiple channels into a single platform is done that enables the units to share real-time information. Employees can access the data whenever they need, by using the system and there is no department wise notification after every update. As e-commerce became an indispensable part of the retail industry, ERP tools with e-commerce integration came into existence.
Sales analytics, pricing and discount management – Sales and profit is the ultimate goal of every retail industry. In the course of achieving the goal lot of steps and factors involved in the industry. However, to improve sales and in turn, the profit, a lot of strategies have been taken into account. ERP system is one of the most important strategies that have been introduced in the retail sector for improving sales by performing analytics on past sales and customer trends. The sales analytics, in turn, helps the retail management to take the decision of which product should be promoted and which one to be discarded. Also, the areas or factors associated with sales, like costing, sales offers, discounts, etc. can be enhanced with the ERP system. Using the ERP system, the process of recording price and the discount of the products can be automated and also simple as well as effortless.
Point-of-sale system or PoS system- The PoS system is the new-generation sales method that has gain immense popularity in the retail industry. All the transactions happening in any retail outlet can be overseen by PoS machines. All the details of the transaction automatically fed and thus extra effort or the scope of human errors can be discarded.
The above 7 benefits of ERP for the Retail Sector are the significant ones that are theoretically briefed after research and study. However, the retailers are the ones who can share true benefits after using ERP for their business. So, according to the retailers, the benefits are:
- Transparent visibility from quote to cash
- Reduction of headcount without affecting sustained growth
- Operating and administrative cost are reduced
- Obsolete inventory discarded and reduction in inventory cost
- Decision –making time has been reduced
- Utilization of resources
- Waste reduction
- Impact on bottom line profits and in a positive direction
- Inventory management, customer relationship management, Supply chain management, warehouse management, Business Intelligence management,
- Improved customer value delivered, etc. and many more
In this competitive world, seeking profit and business growth in any retail industry is not a big deal. However, to succeed in availing this big deal is the most challenging task. ERP or enterprise resource planning is the one-stop solution for integrating and managing retail industry smoothly.
Conclusive thoughts: The benefits in the retail industry are significant and there is no doubt about that. But, some retail industries require a customized ERP system to meet their specific needs. The ERP system developers are in continuous up-gradation of the technology to meet every retailer’s needs to use the ERP system in their business. AIDOOS has generated a platform where problems and solutions meet one another directly in ERP, CRM, Business Intelligence, Cloud Computing and many more. To know more reach us now.