As e-commerce continues to mature, more and more consumers have begun to treat online shopping as their preferred retail channel. If you asked someone (especially if they’re under 40) to imagine a typical shopping experience, there’s an increasing chance that their thoughts will feature a virtual shopping cart, digital wallet, or same-day delivery. These days, leading retailers cannot afford to give their digital channels lower priority than their physical retail locations. An ERP platform can ensure that all of your sales channels operate on an equal footing.
ERP systems improve efficiency by centrally managing all of your retail channels and allowing them to share vital business information. The biggest multichannel advantages offered by ERP solutions include:
Faster, cross-channel order fulfillment
Order fulfillment teams that rely on manual actions are extremely inefficient. They might use paper records or spreadsheet software to keep track of orders, and contact suppliers and logistics firms by email or phone. Each of these separate activities creates an opportunity to make a mistake, and makes the fulfillment process harder to track. ERP platforms replace this complex collection of business actions with a single, efficient solution that generates its own audit trail. Automated dynamic workflows determine the requirements of each order and send information and instructions to all relevant personnel.
By consolidating business activities across all retail channels, ERP systems reduce the time and effort required to process each order, and even enables order fulfillment options that are simply too complex for manual processing. Retailers that use modern ERP systems allow customers to pay online and pick up their purchased items from the retail location of their choice, return online purchases in-store, and several other cross-channel services that enhance their shopping experience.
Omni-channel inventory automation
Operating across multiple locations and geographical regions poses a significant challenge for large retail chains. Similarly, companies that offer multiple fulfillment options increase the complexity of their day-to-day logistics. Manually tracking and managing stock levels across locations is incredibly imprecise, with updates occurring on a daily or even weekly basis. This makes replenishment inefficient, and forces retailers to carry higher product quantities to avoid out-of-stocks.
ERP solutions vastly improve retail profitability and operational efficiency by allowing retailers to maintain stock levels that closely match actual customer demand. A single, consistent, company-wide record of all sellable inventory improves your omni-channel customer experience – if a product is available, say, on your online store, then it will also be available via mobile app or telephone shopping. In this way, retailers avoid the complications associated with managing separate inventories for each channel.
Universal customer records
Managing each retail channel independently leads to inconsistent and incomplete customer records. If an online shopper purchases or returns an item, store associates and call center reps would have no way of accessing the customer’s transaction history, which would severely restrict their ability to provide assistance or resolve issues.
ERP systems act as a centralized store for all customer information that is updated instantly whenever the customer makes a purchase, return, calls your support center, or accesses your customer web portal or online store. This helps you create a consistent and personalized experienced for each shopper, and also gives you a much more complete picture of their purchasing preferences. These consumer analytics are an invaluable source of information, and can significantly improve your product development, sourcing, and marketing efforts.
Accurate, real-time information
Improved accuracy is a major advantage of ERP platforms that cuts across all business processes. Having all of your business information in one application eliminates the need to transcribe information from one platform to another, which is a major source of error. Information that is entered once can be accessed by any other department or business process that needs it. Any transactions or shipping and receiving activities that take place are logged in the system in real time, preventing inconsistency across channels, departments, or physical locations. With a single version of the truth, your personnel no longer have to wonder whether their stock levels or sales figures haven’t been updated yet.
On one hand, employing large teams to process orders and maintain paper records is expensive. On the other, relying on a smaller workforce will result in extremely low fulfillment rates, which impacts revenue. In both cases, using manual processes impacts profitability.
ERP solutions improve your organization’s bottom line by improving productivity while simultaneously reducing labor costs. Thanks to automated workflows and delay-free communication, retailers can process more orders and ship more products per hour. Managing all of your channels centrally also helps control costs, since you don’t have to maintain separate IT systems for each channel, and it takes less time to manage channel information. As mentioned above, ERP systems also improve data accuracy, which helps prevent costly mistakes and business risk.
ERP systems give your customers a superior buying experience, and help your employees provide better customer service by providing a seamless experience across all retail channels. Choosing a technology implementation partner with extensive experience in the retail industry is the best way to ensure that your ERP implementation complements your existing business processes and scales well as your business grows. A retail-savvy technology partner will deliver an industry-specific solution on an accelerated schedule, which means that you’ll begin seeing results sooner. An implementation partner’s level of industry familiarity also reduces the chance of business disruption, missed deadlines, or going over budget. To discover the ERP solution and implementation strategy that aligns best with your business objectives, please contact Visionet Systems to schedule a complimentary consultation session.
One of the greatest documentaries in the apparel industry from the past ten years is the HBO special titled “Schmatta: Rags to Riches To Rags.”
It outlines domestic production in the apparel industry in and around the NYC area. The stats were astounding with a staggering 95% (1965) production done domestically and 5% (2009) done overseas. Today apparel production has done a total 180 with a handful of vertically integrated manufacturers in the USA.
The supply chain shift from domestic to one of many import workflows is a “standard carton X Factoryfrom Vendor to cross dock DC to the Customer.” The touch points are decreased using algorithms with a focus on getting the goods out the door before the cancel date.
Lower prices triggered the paradigm shift of production with higher quality. A logical move for any business- get it cheaper, faster and better. This did create a logistical nightmare for shipping and receiving goods up until recently when “cloud technology” allowed production and logistics managers to enhance communication via supply chain. The organization “silo” is the number 1 disconnect in Global Supply Chain.
Global supply chain software such as Visionet’s EdgeAX applies those same algorithms in a workflow environment that
streamlines the business process using Vendor Portals that connects to the ERP. The Silo risk is eliminated with
Power BI (Business Intelligence)
Also, a unified commerce solution is provided that allows the corporation to break down the SILOS and plan the first response to mission critical deliveries! (Imagine online banking ease of use for Global Supply Chain Communication)
This simple approach is achieved with Visionet’s EDGE AX Version 7 solution. It simplifies lead times and communicates with calendars that align with departments such as merchandising and logistics.
So if we are improving opportunity time and touch points while breaking down the silos, the bottom line is significantly increased with the shift in technology. Very simple solution!
BIG DATA WILL ONLY GET BIGGER… so what is your BIG DATA PLAN?
Wayne Gretzky puts this best
- “Skate to where the puck is going, not where it has been.”
TEAR DOWN THOSE SILOS WITH EDGE AX V7 and get to where you need to be…
VP Global Supply Chain and WMS, Visionet Systems
Artificial intelligence, specifically machine learning (ML), is quickly becoming essential for running smarter business operations. One of the greatest features of Dynamics 365 is its ability to incorporate ML capabilities within business applications, which provides predictive insights and helps businesses execute operations in more effective manner.
According to a recent study by Mckinsey Global Institute, advanced AI technologies have the potential to unlock a global economic impact of $10-15T across all industry segments.
Sales, marketing, supply chain management, and manufacturing are major segments that could significantly benefit from machine and deep learning technologies in retail and CPG.
Below are a few candidate scenarios for AI-enabled optimization for the retail and CPG veticals in particular. Later in the article, one use case is explained in detail using Microsoft business applications.
“61% of organizations picked machine learning as their company’s most significant data initiative for next year.” Source: Forbes.com
Dynamics 365 for Finance and Operations allows you to integrate Azure Machine Learning into your Dynamics environment to predict demand more accurately by infusing more demand planning parameters and considering new statistical models.
1) Historical data: The first and most important step of the process is gathering and preparing the transactional data from Dynamics 365 and providing it to Azure Machine Learning Studio for training the mode.
Item allocation keys are used to bundle similar products for which the demand-forecasting algorithm should run on historical sales.
Navigation to set up similar products in the historical data:
Master Planning -> Setup -> Demand Forecasting -> Item Allocation Keys
2) Train your model: Once historical data is loaded, a model needs to be trained for accurate forecasting. In this example, we have an R script, however, we can build forecasting models in Python as well. In this scenario, we are using a predefined model available in the Experiment Lab.
Is integration real-time between ML and ERP?
Since Dynamics 365 and Azure are both in the Microsoft family, they are easily integrated to allow for real-time results.
Navigation to enable this integration:
Master Planning -> Setup -> Demand Forecasting -> Demand Forecasting Parameters
On the Azure Machine Learning FastTab, provide the web service key and endpoint received from Machine Learning Studio.
3) Generate a statistical baseline forecast: After completing the setup and configuring the demand forecasting parameters, we generate a statistical baseline forecast.
Navigation to generate the statistical baseline forecast:
Master Planning -> Forecasting -> Demand Forecasting -> Statistical Baseline Forecast
Once you click OK, it looks for the best-fit model as per the forecasting parameters and generates the forecast from the ML engine.
4) Adjustment and approval: We can now adjust and approve the forecast as per business needs and including other factors like market volatility, etc.
Master Planning -> Forecasting -> Demand Forecasting -> Adjusted Demand Forecast
Once we authorize the demand forecast, we can run the master planning and create planned orders. Each planned order generated includes master planning parameters e.g. production process, minimum lead time, lowest unit price, and safety stock calculation based on the coverage group assigned to the item.
Hence, with a few steps, we were able to set up a predefined, AI-infused demand forecasting model in Dynamics 365 to generate forecasts.
With the Microsoft Dynamics 365 platform, all of this is can be customized to fulfill your business needs. Microsoft has provided numerous ML models under cognitive services that can be used as a foundation and further trained for customer-specific scenarios.
Visionet is a trusted Microsoft Gold partner and has 20+ years of experience delivering projects in retail and CPG. If you are looking to enable these AI initiatives for your organization, please contact Visionet today.