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Tbe past three years were a catalyst of change for the retail industry. A convergence of forces, including supply chain disruptions, the Great Resignation, inflation, new consumer behaviors, and silos of legacy systems, forced businesses to rethink their strategy. The key is to look for vigilant management responsiveness, embrace automation and explore the benefits of ERP integration to stay ahead of the curve.
While many retailers accelerated digital transformation to adapt to the evolving business landscape, they haven’t used the right tools and tech stack to achieve operational excellence. One such solution that has proved to be instrumental in propelling business efficiency is Enterprise Resource Planning (ERP).
Tag along as we explore how forward-thinking retail businesses can leverage ERP to streamline their business operations and gain a competitive edge.
Enterprise Resource Planning in Retail: A Brief Overview
The core function of an ERP is to consolidate all software used throughout a business into a unified suite to manage end-to-end business operations. An ERP normally covers business areas including: product planning, costing, service delivery, marketing and sales, inventory management, shipping, and payments.
An ERP system used in retail differs from a traditional ERP. It’s designed to handle specific business processes of omnichannel or multichannel retailers. With retail ERP services such as Microsoft Dynamics 365 ERP, retailers can streamline, automate, and manage front and back-end business operations and become more agile.
Benefits of ERP Integration: 6 Ways Retailers Can Optimize Business Operations
1. Build Resilient Supply Chain Operations
Evolving consumer preferences, changing trade conditions, tightening industrial regulations, and sustainability requirements alongside rapid tech advances were already forcing retailers to rethink their supply chains. When the pandemic hit, supply chain woes exacerbated. A survey by the Institute For Supply Chain Management revealed that 75 percent of all companies are experiencing supply chain disruptions due to COVID-19.
In response to these challenges, retailers must develop agile supply chain management strategies. Which includes implementing an ERP system. This solution automates tedious tasks from demand forecasting, procurement, and inventory management to end-customer product delivery. It helps build a resilient and intelligent supply chain that can be monitored and managed from anywhere. Your team will have access to critical information for optimizing products, avoiding delays, and responding to opportunities and roadblocks as they arise.
2: Optimize Inventory Management
Having complete control over your inventory means you have enough stock to fulfill anticipated orders while removing the surplus. Since the retail industry is primarily built on Fast-moving Consumer Goods, the demand for these products tends to fluctuate daily. Therefore, being out of stock or having it in excess can lead to financial losses.
An ERP can address these challenges comprehensively. Some benefits of ERP Integration with respect to inventory management include:
- Complete Visibility
An ERP lets you coalesce inventory and warehouse data in a single solution. Notifications alert you of over or under-stocking to respond to issues timely.
- Stock Tracking and Planning
An ERP integrates all your existing tools and offers a comprehensive view of the entire inventory across retail touchpoints. The system can track and report inventory shortages, excess, planned replenishment, and even obsolete inventory. As a result, businesses can procure stocks as well as deliver customer orders at the right time and in the right quantities. Leading to improved customer satisfaction scores.
With accurate inventory data, ERPs can generate reports and give data-driven insights such as your top-performing SKUs, sales by location/channel, and other metrics. You can even create customized reports for accurate forecasting and planning.
With such a 360-degree visibility of inventory, a business can maintain optimal stock levels and avoid costly errors at the same time.
3. Enhance Operational Efficiency
This is one of the most evident benefits of integrating an ERP in retail or any business. It automates workflows, simplifies data to ensure seamless operations, and organizes information in a central location. Moreover, digitization of manual and repetitive tasks leads to resource efficiency, reduced operational costs and a boost in business efficacy and overall productivity. An ERP serves as the keystone for supporting progress, streamlining workflows and revolutionizing retail business operations.
4. Improve Financial Management
The finance module of an EPR shows the bigger picture for evaluating a business’s financial health. An ERP solution, such as Microsoft Dynamics 365 Finance and Operations, covers a spectrum of intelligent tools, which can be integrated into your core finance operations for end-to-end financial visibility and to minimize cost.
Retailers often follow a dynamic pricing system, which can take hours if managed manually. An ERP automates the process of recording product prices and discounts. It also lets you access relevant data for defining budgets and allocating costs for tasks, such as buying raw materials, making transportation arrangements, managing payments to vendors, and other operational expenses. In addition, the AI-powered dashboard and insights give a financial overview as and when needed to let you access the general financial health of your business.
5. Offer Predictive Analytics to Drive Sales
Advanced ERPs don’t just collect and integrate data; they also feature built-in analytics, giving retailers insights into real-time operations. These include inventory management and omnichannel order fulfillment. Decision-makers can use predictive analytics to identify products that are sustaining profits and ensure the availability of those products to maximize sales.
With information such as your best-selling items, top revenue centers, and slow-moving products, the sales and marketing team can review current campaigns/strategies and make decisions in the business’s best interest.
6. Optimize Employee Management
One of the most overlooked benefits of ERP integration in retail is employee and customer management. The human resources module of the ERP automates repetitive tasks, including payroll, invoicing, and reporting. Workforce management becomes easier since you don’t have to check your employees’ schedules back and forth. The analytics features allow the HR team to objectively review employee performance, monitor their goals, assign new tasks, and boost overall employee productivity.
Streamlined business operations, a boost in productivity, improved customer satisfaction, and other stated benefits of ERP integration in a retail business make it a worthwhile investment. This solution is inevitable when it comes to sustaining and competing in the present business world.
Ready to invest in an ERP? Our Dynamics 365 Finance and Operations can support your business needs. This end-to-end ERP solution manages production, inventory, supply chain, purchase orders, finances, sales, and distribution. To learn more about our service, book a demo, or consultation, or contact us at email@example.com.