By Radim Jung
In today’s fast-paced digital world, where information and products are just a click away, the retail landscape has undergone a dramatic transformation. Gone are the days when businesses could choose between being fast, cheap, or high-quality – now, they must be all three. This new paradigm has placed unprecedented demands on retailers, making technology a not only a necessity for success but survival.
Traditionally, retailers attracted customers through strong brand promises, aesthetically pleasing storefronts, and emotionally engaging campaigns. These elements, primarily under the marketing umbrella, were the differentiators that could turn a small shop into a national chain.
However, as main street retail spaces increasingly become click-and-collect locations, the marketing pros of yesteryear have become the drawbacks of today. The brand promise is no longer about a unique experience; instead, it has transformed into an inventory promise. Today’s retail businesses compete on portfolio breadth and availability, with marketing headlines proudly proclaiming, “Come to us, we have a million items in stock near you.”
To deliver on such bold promises requires an enormous amount of planning, execution, and a vast IT infrastructure. Often, this involves AI-based forecasting and real-time visibility into a businesses supply chain and warehouse operations.
Inventory Management Software (IMS) has become increasingly accessible to small businesses. Tools like warehouse optimization, distribution optimization, omnichannel sales optimization, pricing strategies are no longer exclusive to enterprise-level businesses. An IMS with accessible AI tools, like Cin7, allows small and medium-sized retailers to maintain and scale efficient operations.
To offer a diverse product selection that will make customers say, “Wow, I can get everything here,” retailers must maintain relationships with numerous suppliers and either operate large warehouse(s) or utilize a 3PL. At this scale, a comprehensive IMS is crucial. It’s not just about keeping track of inventory; it’s about having a data-rich source for all forms of optimization. A single source of truth is the first prerequisite for growth and effective decision-making.
It’s physically impossible to manage hundreds, or even thousands of SKUs manually. Advanced AI algorithms help forecast sales and keep replenishment on track with demand so you avoid the dreaded “Out of Stock” button.
While you can solve availability issues with intentional overstocking, that approach conflicts with the goal of staying competitively priced. This is where AI-driven inventory management becomes crucial to keep optimal stock levels balanced with availability and cost.
Competitive pricing is essential for product sellers to succeed. However, pricing and promotions planning are no longer disciplines of “gut feeling.” They have evolved into hardcore mathematical disciplines that create simulations and A/B scenarios for testing. For large, and now small, players, price decisions result from deep inventory analysis.
The keys to success and growth in retail are now a magnitude more complex than they were two decades ago. While it is still important to train staff to be kind and maintain a brand identity, these are just starting points.
Advanced inventory optimization and algorithmic AI-based decision-making have become central to success. The good news is that these tools, once the domain of enterprise-level businesses, are now available for hundreds rather than millions of dollars.
Success in this new era requires a perfect blend of traditional retail values and cutting-edge technological solutions. While the challenges are greater than ever, so too are the opportunities for those willing to embrace the technological revolution in retail.
As we move forward, it’s clear that the future belongs to retailers who can effectively leverage technology to meet the trifecta of being fast, cheap, and high-quality. The good news is that with the increasing accessibility of advanced tools, businesses of all sizes have the opportunity to compete and thrive in this new retail reality.
Radim Jung, VP Product, Forecasting
Radim was the co-founder of Inventoro, a demand forecasting startup, acquired by Cin7. He now acts as VP of Product, Forecasting at Cin7. During his time with Inventoro, Radim was mainly responsible for communications, customer care & GTM. Before founding Inventoro he was the CEO of a marketing agency helping multinationals, politicians, public institutions and startups alike to succeed in the public sphere, often on the global market. He has a background in political communications, PR, marketing, branding, start-ups, and B2B SaaS. He is currently based in Prague, CZ.
