Reduce logistics costs and improve delivery time with Increff Regional Utilization

The phenomenal rise of e-commerce is hardly unprecedented. Over the last few years, the growing internet penetration, affordable data prices, persistent efforts of e-commerce companies, and the global pandemic, compelled the digital revolution on even the most unwilling customers and companies. It was an evolve or get left behind situation for many companies and the bottom line is that e-commerce is here to thrive. In fact, many companies embraced this change, transforming or launching their businesses to be direct-to-consumer (DTC) brands. 

Roadblocks in the success story of e-commerce

E-commerce’s exceptional growth hasn’t been without hurdles. One of the biggest challenges faced by online retailers is logistics and the cost associated with it. Considering the length and breadth of the country, combined with various terrains and inadequate infrastructure, digital retailers had to start from scratch. 

Though initial hiccups are out of the way, there is still a ton of room for improvement as the current logistics costs are still quite significant. While retailers are catching up, customer demands are already evolving. Faster deliveries, as fast as one-day or same-day delivery, are quickly becoming a norm as customers are willing to incur a cost to get their purchases. This is a testament to how e-commerce has grown from a discounted marketplace to the preferred choice of customers. 

Changing customer demands 

This change in customer behavior and demand has set a new challenge for e-commerce retailing. To be able to offer faster delivery speed, the products being sold have to be physically close to the final delivery destination or the seller should be able to transport them in time. Goods are primarily transported from warehouses through the surface (road/rail) or air. As an increasing number of orders are from tier II and tier III cities, processing these orders in the stipulated time is becoming a challenge. Air transfers are costly and unsustainable in the long run. Many of these locations are not connected by air, therefore surface shipments are feasible but may delay deliveries. It is entirely possible that while solving this dilemma, the seller might lose out on the customer due to delivery time. 

Making inventory more accessible 

How do e-commerce retailers and sellers solve this perpetual problem? The need of the hour is a better strategy when it comes to the distribution of inventory. Optimizing inventory distribution through distributed warehousing can reduce delivery time and logistics costs while keeping customers satisfied. The answer lies in making use of Regional Utilization often also referred to as smart inventory distribution or smart warehouse distribution.

Based on customer pin code level demand pattern, rate of sale, days on hand cover, and festivities and seasonalities, Increff Regional Utilization algorithms ascertain where to place your inventory. If your inventory is already close to the customer, order fulfillment becomes quicker and more cost-efficient. 

Some more benefits of Regional Utilization include – 

  • Reduction in the number of returns due to late delivery
  • Increase in sales as customer satisfaction scores increase 
  • Lesser deadstock due to highly streamlined inventory distribution
  • Sustainable deliveries with lower impact on the environment 

Having data and insights about operation-wide customer demands can also help the business expand. Understanding the demand, warehouses can be placed at strategic locations and goods can be diverted to locations with higher demand. This data can also aid in the creation of localized products, offers, and promotions.  

Increff Regional Utilization is a web-based, self-serve SaaS tool that uses patent-pending algorithms to provide proportionate inventory allocation across warehouses and new style distribution based on attribute group performance.

Results of implementing distributed warehousing result in the conversion of up to 70% of air shipments to surface shipments, a significant uptick in delivery times, and up to 12% savings in logistics costs. It can be deployed in a matter of minutes for all types of businesses, making it a quick yet valuable long-term investment. 

Optimizing delivery times for SMEs 

As many SME’s are also embracing e-commerce to sell their products, their challenges when it comes to distribution and supply chain are different from the established players. These businesses don’t have their own warehouses which can often mean longer delivery times. To optimize their operations, such businesses can use Cloud Warehousing / Warehouse Management Outsourcing to be closer to the customers. 

Increff partners with third-party (3PL) logistics players to provide warehouse outsourcing and inventory management services to businesses through Cloud Warehousing.  This service reduces investment costs as payment is based on the usage of space and services at the warehouse. Businesses incur no capital costs, but only operational charges for using cloud warehousing. For SMEs, this can not only reduce delivery times but also solve the problem of efficient distribution and inventory management.

Technology Warehouse Management

Perfect Warehousing Solution for Higher Efficiency and Inventory Management

Warehousing is an integral part of the supply chain where retailers can reduce costs by optimizing inventory, minimizing overheads, and speeding up the delivery time. Digitization and automation of processes help maximize space utilization, streamline operations through accurate inventory tracking, and promote productivity among workers to save time and money. 

Increff’s comprehensive WMS and OMS platform, recognized by Gartner and Forrester Research, is a cloud-based solution specialized for B2B and B2C e-commerce warehouse management and order fulfillment. It is designed to scale with the increasing demand of online sales and guarantees 100% inventory tracking by assigning a UPB (Unique Piece Barcode) to individual pieces, just like the IMEI number in phones, to boost efficiency in inventory management. Mobile barcode scanners create a low-cost, low-risk path for preventing human errors and capturing critical warehouse performance data for actionable insights. 

Read: How to choose a Warehouse Management System

E-commerce-focused WMS and OMS – Increff WMS allows retailers to do more with less manual effort and thrive under increasing demand scenarios like peak sales season. It allows channel and/or SLA prioritization for faster picking and order fulfillment. The system generates picklists keeping in mind linear pick paths to avoid delays and allows smooth operations that can continue even during cycle count and inventory audits, without losing on sales opportunities. The live-inventory-order sync feature facilitates instant inventory updates to avoid order cancellations due to overbooking. Brands can expose 100% of inventory simultaneously across all sales channels and eliminate the need for safety stock thus keeping the inventory lean.

Benefits of serialization in inventory management

Built for 100% inventory accuracy, UPB captures every action on an individual item thus reducing the need for cycle counting or chances of inventory getting lost or misplaced.

  • Optimizing space utilization in the warehouse: Designed for a high level of inventory accuracy and order fulfillment, serialization allows easy storage of multiple SKUs in a single location, thus optimizing space utilization. Retailers can stock items at the nearest possible location and the system maps them during order picking so no piece is lost or misplaced.
  • Managing limited shelf-life products efficiently: Products that have an expiration date present unique challenges affecting efficiency, performance, and cost of operations. Mismanagement of expirable items can lead to loss or obsolescence. With Increff WMS’s expiry feature, retailers can trigger alert notifications for batches approaching their sell-by-date. It helps retailers push items in a FEFO (First Expiry First Out) manner to appropriate sales channels for faster sales. 
  • Auto-replenishment of fast-movers: Increff WMS’s auto-replenishment feature helps identify top seller SKUs and raises an alert notification when their quantity reaches a designated par level. It allows brands to maintain a steady stream of inventory without the risk of backorder pilling up or goods sitting for too long and incurring unnecessary carrying costs or loss due to spoilage and theft. 
  • Optimizing labour efficiency: Automated picklists can be generated to prevent mistakes and improve picking efficiency. Inventory serialization reduces travel time by suggesting linear pick paths and streamlining picking by embracing chaos and complete randomness. Barcodes direct warehouse pickers to locations, reducing walking and searching of items, and help in consolidating multi-piece orders. It prevents human errors in high pick-volume situations through scan-based checks at order and box levels. Image-based visual cues, at the time of scanning, ensure accurate picking. The automatic inventory update feature prevents manual intervention and multiple steps like counting, QC, and Bin putaway are consolidated in a single step which makes the inwarding process faster.   
  • Training and Development: Handheld devices and barcodes lower operational overhead costs by 20-25%, with less dependency on skilled labour. Increff WMS is easy to deploy and has a simple UX-UI design that facilitates training in less than 5 mins so employees can be highly productive starting from day one. 

Future-focused retailing is all about agility and flexibility in execution and data-driven decision-making. Technology solutions like Increff WMS reduce clutter by organizing processes to give a high level of clarity on business performance. It has helped brands achieve a 2-3x increase in sales and capitalize on increasing demand effortlessly. Handheld devices and serialization optimize processes and reduce errors by increasing accountability and a better trained, trusted workforce empowered with real-time data and analytics. Handle the increasing margin pressure in retail and excel in this hypercompetitive environment with the new-age warehousing solution. 

Smart Merchandising Warehouse Management

The Next Big Thing in Retail: Automation in Inventory Management

As more and more people turn to omnichannel shopping, something as simple as maintaining inventory has become more difficult for companies. The silver lining is that along with consumer purchasing preferences, the technology required to conduct an efficient business has also evolved leading to digitization and automation of processes including inventory management.

Manual vs Automated Inventory Management 

A labor-intensive process, manual inventory management heavily relied on people’s ability to consistently perform at their best. This was also a time-consuming job that rarely offered a comprehensive picture of a company’s inventory in real-time. It involved counting, aggregating, and calculating data at every step. Even the smallest errors could have a grave impact in the long run. 

An automated system makes these processes simpler, reducing the amount of human intervention and involvement by providing each SKU with a serial number or a barcode. It presents various insights and access to warehouse/operation-wide data easily. This means all information becomes readily available, movement of the product can be followed, and there are fewer discrepancies. 

Considering an increasing number of companies are opting for an omnichannel approach, the lack of a cohesive selling and stocking strategy can translate to significant losses. If you are considering moving your business operations to an automated inventory management system, here are some benefits – 

  • Stock visibility –There is 100% inventory exposure, across all sale channels at the same time. Real-time inventory-order sync increases the chances of sales and minimizes order cancellation due to overbooking.
  • No “lost” stock – Once a product is assigned a serial number and scanned into the automated inventory management system, the chances of getting misplaced or lost are close to zero. 
  • Minimizing manual errors – An automated system reduces the number of human errors.  
  • Analytics & Insights – Stocks can be redirected where there is higher demand, and prices can be changed depending on the trends which are showcased by the automated inventory management system. 
  • Scalability – The biggest benefit of implementing an automated inventory management system is the ability to grow and expand faster and quicker. 

Automation in Inventory Management at Stores 

An automated system such as Increff Merchandising Solution can efficiently manage the following functions increasing sales, productivity, and overall performance of a store. 

  • Assortment planning and buying – Using algorithm-driven data, an automated inventory management system can analyze the demand and help in product planning for the store. This tool takes into consideration real-time data regarding sales, revenue, discounts, size cuts, stock-outs, etc. These factors can determine buying and assortment planning tool as the tool analyses 17 levels of product attributes, providing accurate insights for informed decision making. 
  • Restocking – As this merchandising solution keeps track of stock, there are automated alerts to ensure that the store has enough stock to match demand at all times. It becomes possible to automate the re-ordering process with proper checks and balances to keep your stores running smoothly. 
  • Replacements and replenishment – Once any of the bestseller stock gets sold out, it is prudent to have them restocked as soon as possible as it can affect the cash flow. Increff Merchandising solution identifies bestsellers as well as low-selling stocks. Having this information means that a store can always have its bestsellers in stock while moving its low-selling items through various promotions to avoid deadstock at the end of the season.  
  • Inter-store transfers – A unique feature of Increff Merchandising solution is showcasing trends in purchase which can help retailers to move stock between stores if there is a demand mismatch. This helps in utilizing the stock while avoiding losses. 

Automation in Inventory Management at Warehouses 

Automation in inventory management at the warehouses can be beneficial in preventing human errors. An automated system can also increase efficiency and reduce losses due to such errors and oversight. 

Increff’s WMS solution automates processes in the warehouse by using inventory serialization which can properly track SKUs and facilitate better space utilization. This enables faster picking and packing at warehouses, reducing the turnaround time for completing orders. Each time a product barcode is scanned, all of its details including a picture are displayed to ensure zero errors while packing a product. This WMS has a simple and friendly user interface to make sure that all warehouse workers can be quickly and easily trained to use this software. 

The overall benefits of using automation in inventory management increase as your business grows and expands. The transformative powers of automation are many and the need to integrate automation into your business is more evident than ever as the world itself goes through a transformative time.  Based on your business needs and goals, choose an automation solution that works the best for you.

Smart Merchandising

Assortment Planning For Profitable Retailing

There are hundreds of people who walk into your store every day.  This provides an opportunity to convert them into loyal customers. How do you impress them? A straightforward and data-driven way to ensure that you always meet your customers’ expectations is by investing in assortment planning. 

What is assortment planning in retail? 

Simply put, assortment planning is the process of deciding which products and varieties are sold at your store during a particular duration. This includes the number of products, variants for each product, and the correct amount of stock that your store should hold. This process can happen weekly, monthly, quarterly, etc. It highly depends on what your store offers to the customers. 

Why is assortment planning important in retail? 

Striking the right balance between having enough to satisfy customer needs and making sure that you are not left with dead stock is of utmost importance to maintain profitability. 

Keeping in mind the market demand and customer expectations, while maintaining higher margins, is tough and it gets tougher especially in the retail sector. Heavily dependent on trends and seasons, fashion retail stores have to be meticulous during the assortment planning process. These changing trends add an additional layer of complexity over usual factors such as weather, festive seasons, holiday period, etc. 

Considering the high stakes and significance of assortment planning, it is important to follow a process to get the balance right every time.  

Is there a one-size-fits-all solution when it comes to assortment planning?

As most retailers who are a part of a chain of stores will tell you, the answer is no. It is important to take into account each store’s location, geography, store size, historic data and trends, customer demographics, local needs, etc. Though it is not feasible to have a global, national, or even state-wide strategy when it comes to assortment planning, it is possible to group similar stores into clusters based on certain common parameters. This can make assortment planning easier while presenting a chance to offer local products, offers, discounts, and promotions. 

How to do assortment planning for retail stores? 

As assortment planning takes into consideration numerous factors, it is important to create a methodical plan to help you navigate through this elaborate process.  Here are some pointers to get you started – 

1) Set goals

A smart assortment plan reflects the business objective of the company/store. This could mean expanding the category, ensuring growth, launching a product line, meeting certain sales benchmarks, etc. 

2) Analyze

Evaluate historic store data from your last season and factors such as past sales, category trends, size preferences, fast-selling items, etc. This can help you understand customer demands and preferences. 

3) Calculate

As it is important to have a balance between breadth and depth of product category, use data to ascertain the right balance to satisfy customer demand. 

4) Cross merchandise

While deciding on the product selections, be sure to have products that can be promoted and placed together. An effective and creative display can prompt the customer to buy multiple products. 

5) In-style and classics

Offerings at your store should be varied and vast. It is crucial to have products across categories in various colours, types, price points, and even trendiness. Some products are considered “classics” or “staples,” these are always in demand. Ensure these are always available along with current trends. 

6) Visual merchandising

Take time to create an appealing storefront and interiors using visual merchandising. Placing the products at the right place at the right time can help you drive sales and loyalty. 

Assortment planning doesn’t end here. Considering how quickly trends and demands change, it is imperative to stay engaged and aware of what is happening at your store. Having a smart merchandise planning, buying and demand sensing solution, can prove to be a vital tool during pre-season assortment planning and in-season retail challenges. 

Increff’s smart merchandising solution provides support during assortment planning by analysing and forecasting across stores based on past sales, revenue, discounts, size cuts, stock-outs, and exposure. It aids in determining actual procurement orders as well. Built-in analytics are designed to reduce deadstock and utilize inventory by optimizing stock across stores and providing dynamic markdown suggestions. Moreover, Iris X can simplify assortment planning by suggesting replenishment and replacement through automation. 

Assortment planning is no longer a one-time, pre-season activity. It is a continuous process till each SKU leaves the store with a happy customer. The only way to navigate this increasingly complex process is to invest in an automated merchandising tool that lets you customize it to your preferences while setting benchmarks and providing smart analytics for the betterment of your business.

Smart Merchandising Technology

Intelligent Inventory Management of Apparel, Seasonal, & Short Life Cycle Products

Increff named as a Representative Vendor in the 2021 Gartner Market Guide for Retail Assortment Management Applications (RAMA): Short Life Cycle Products

Covid 19 exposed inefficiencies in processes and systems, highlighting the need for preparedness and resilience through digitization. In the report, Gartner predicted that “by 2024, Tier 1 retailers in North America and Europe will reduce inventory carrying costs by 30%, dramatically improving free cash flow for digital investment, while revamping balance sheets. Much of this reduction will be effected in seasonal, short life and apparel categories where manual processes and gut feel are no longer enough”. The report further states, “Customer’s expectations of a unified retail commerce experience continue to challenge multichannel retailers to pursue digital business transformation”. 

Accurate merchandising requires complex orchestration across all processes such as assortment planning, in-season analysis, space management, allocation, pricing, replenishment, and supply chain. Modern cloud-based solutions, like Increff Merchandising Solution, incorporate advanced algorithms to create location-specific assortment to drive transformation through better customer understanding and alignment to limit excess inventory. Shortened product life cycles are due to fast-changing customer preferences e.g. in fashion, or rapid technology innovation e.g. consumer electronics. For such products, production and procurement decisions need to be made fairly in advance, or JIT (Just-In-Time) so production can start as soon as an order is received so no finished goods are stocked. 

Task automation enhances speed and shifting from excel to purpose-built applications augments human activity. Retail Assortment Management Applications (RAMA) for omnichannel brands are foundational for modernizing merchandising processes and form an integral part of the core merchandising application suite. Using big data, both historical and near real-time, with advanced analytics and algorithms helps create store-specific assortments aligned to specific customer behavior segments. 

Increff Merchandising Solution (MS) considers the uniqueness of each store up to ‘segment of 1’ for managing merchandising processes accurately.  

  • Assortment & PlanningRight assortment planning is critical to achieving a competitive edge in the industry by reducing carbon footprint and wastage of resources. Increff MS helps determine and allocate the right set of inventory to the right sales channels. It closes the gap between financial planning and store planning by determining the optimal mix that makes stores more attractive for local shoppers thus improving profitability and sales efficiency. It provides the ability to plan complexities in a user-friendly, cost-effective manner that maintains in-season and new-season inventory freshness, event-based allocation, and proper markdowns during liquidation scenarios for maximizing sales
  • Automation – Increff MS is an algorithm-driven SaaS platform that leverages scientific decision-making to determine the right store-wise allocation, based on real-time data analysis of 17 layers of attributes. It considered factors like style attributes, True ROS™, in-store style health, etc, to increase gross margin and maximize return on investment through item-level visibility and granular data analysis. It facilitates the automation of buying cycle by setting benchmark indicators to signal when a style’s quantity is depleting and requires reordering considering the lead-time. It allows auto-replenishment and replacement by identifying non-moving dead styles to suggest pullback to the warehouse. 
  • Inventory ManagementRegional Utilization and inter-store transfers bring brands closer to customers by intelligently distributing, and re-distributing, inventory according to the local demand. It improves stock health, optimizes inventory, helps in efficient order fulfillment, and prevents extra buying by utilizing the existing inventory to the fullest. Fulfilling orders from the nearest store or warehouse helps brands experience significant savings in logistics costs and manage faster deliveries efficiently. Timely order fulfillment reduces the rate of returns and increases customer loyalty. 
  • Reporting and Analytics – Increff MS’s customizable BI dashboards are capable of generating 50+ analytical reports that provide a highly visual, end-to-end workflow and detailed review of business performance to take focused action on improving traffic conversion and increasing demand fulfillment. Brands can analyze Target vs Achievement, month-on-month store performance for managing operations efficiently, and customize viewability of dashboards based on stakeholders for Category performance reports by calculating sell-through-rate, Planogram adherence, Top seller, and Deadstock. 

Know more about our smart merchandising tool. Contact us to get started. 

Gartner, “Market Guide for Retail Assortment Management Applications (RAMA): Short Life Cycle Products”, Robert Hetu, May 28, 2021.

“GARTNER is registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and are used herein with permission. All rights reserved.”

Gartner does not endorse any vendor, product or service depicted in its research publications and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s Research & Advisory organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.


The Fair, Flawed, and Fouled E-commerce Returns

Returns aren’t just lost sales, they put customer relationships and inventory investment at risk unless managed accurately. They are an important part of the inventory and should be optimized to promote healthy cash flow. Returns denote friction in the shopping experience and present an opportunity for brands to convert disappointed customers into lifetime buyers. 

E-commerce returns vary between industries, often ranging between 15% – 40%; the lowest being for tech accessories and the highest for clothing. Online sales are expected to reach 21.8% of all retail sales by 2024, and considering nearly a third of all products end up being returned to the retailer, the need for controlling it is now, more than ever. It is time to scrutinize the reasons by using smart technologies and execute healthy practices to treat the fair, the flawed, and the fouled returns in the right fashion for higher customer satisfaction. 

Fair returns highlight loopholes in processes and help improve product quality and customer service. 

The damaged, faulty items are extremely harmful to business, and cause huge dents in profits. They are controllable returns that convey where the supplier or retailer went wrong. It could be:

  • Poor packaging and usage of old unfit boxes or fewer packing materials to cut costs. 
  • Courier mishandling and missing important instructions in the rush to expedite deliveries. E.g. fragile packages kept beneath heavy parcels.
  • Improper packaging, making items susceptible to damage due to adverse weather conditions like heat, humidity, snow, etc.
  • Poor warehousing facility or inadequate location that is prone to theft, infestation, or natural disasters like floods and tornadoes.
  • Bad rugged roads or unfit lorries for last-mile deliveries damaged boxes en route.
  • Human errors in packaging or sorting items lead to accidents.   

These returns are very costly and must be addressed urgently. They waste resources, time, and effort, loads of dollars on marketing and logistics, and bring disgruntled customers.  

Flawed returns are defective items that lose the opportunity to sell at full price due to an in-built fault. 

Defective, refurbishable items can be mended but their chances of being as good as new are not guaranteed. These are also controllable as the defects may have been overlooked by the supplier or manufacturer, e.g. quality or manufacturing glitch, or caused due to mishandling by the retailer. If the defects cannot be restored, retailers have an option to sell them in the secondary market at a discounted price. Considering many brands and customers are choosing sustainable retailing, there are separate sites where refurbished items can be bought and sold, e.g. eBay Certified refurbished, Amazon renewed, thredUp, etc. Defective items have now become a part of regular trading and the global secondhand market is projected to double in the next 5 years, reaching $77B

A thorough quality check before shipping the orders can add value by reducing logistics expenses, manpower costs, and the chances of losing a valuable customer due to negligence. Such returns must be resolved by speaking to the customer and convincing them of better service in the future.   

The fouled returns happen when perfect items get returned, thus negating a good sale.

These returns can be prevented to some extent but are unavoidable. They constitute the 19% of customers who deliberately order multiple variations of an item (different colors & sizes) so that they can choose what suits them best. Right technology support, and appropriate analytical tools, can help brands investigate the reasons to prevent frauds like “Wardrobing”, or take corrective measures to improve service, in cases like: 

  • The product in hand does not match its description – It could be a quality issue or some piece in the set is missing. Adding detailed descriptions, high-quality images, the right size chart, customer reviews, and a product video can help customers make more informed decisions. If quality is an issue, then the supplier must be informed to take corrective measures and prevent future returns.
  • Incorrect order delivery – Color or size mismatch can happen due to a lapse in warehousing operations. This can be prevented by using the right WMS and OMS solution, that helps automate processes, facilitate 100% inventory-order accuracy and 100%  inventory traceability. 
  • Late deliveryDistributed warehousing improves operations and ensures timely dispatch of items from the warehouse. Partnerships with trusted 3PLs can help deliver orders safely within the promised time. 
  • Product dissatisfaction – This is an individual choice and difficult to manage unless the customer specifies what they did not like about the purchase. An open feedback mechanism can help understand the customer’s point of view better. 

Returns are a constant problem that will only increase with the growth in online shopping. Manual returns processing is error-prone, slow, and cumbersome, hence the need for returns management software that can simplify and improve the buyer and seller experience. Ultimately, the goal isn’t just to reduce the number of returns but also to optimize the process for higher profits. Build greater trust with customers, understand them well to guarantee the quality, and give them a reason to keep coming back.