[00:00:00.00] - Adam Blair
Hi, everyone, and welcome to this Retail Strategy and Planning series session, how inventory visibility can tame retailers' toughest pains. I'm Adam Blair, Editor of Retail Touchpoints, and I'll be moderating today's session. Retail veterans know that having a clear picture of inventory across all channels is essential to providing a stellar omnichannel experience. But they also know that achieving inventory visibility is much easier said than done. The rise in shopping methods like Buy online pickup in store and curbside pickup, which requires store and item level inventory visibility for maximum effectiveness and customer satisfaction, have made meeting this challenge more imperative than ever. This webinar will explore the nitty gritty details and technology required to achieve true inventory visibility. And our speakers also will share customer stories of how brands like Patagonia and 5.11 accomplish their omnichannel goals. But first, a few housekeeping notes. For anyone attending who may be new to Retail Touchpoints, welcome. I encourage you to join our community of nearly 90,000 retail executives, analysts, and practitioners. Follow us on Twitter and LinkedIn, and of course, check out our great assortment of content and resources, which includes everything from breaking news to timely trend pieces and success stories, as well as detailed benchmark research reports, videos, podcasts, and more webinars like this.

[00:01:17.01] - Adam Blair
And to make things a bit easier, you can subscribe to our free newsletter to get the latest news and content delivered right to your email inbox. Now, let's take a quick look at the platform we're going to be using today. The On24 console you're looking at right now can be completely customized. You can move and resize windows, make the video or slides larger or smaller as you like. You also find an array of interactive tools in this experience. Starting from the left on the bottom toolbar, you'll see a media player button for your video and volume, a slides icon to open and close your slide window. You want to leave that open for today's presentation. A Q&A box. You can submit your questions in this widget at the bottom left of your screen, and we'll get to as many of those as we can at the end of the presentation. You can submit them at any time during the webinar. There's a resource list that you can click through to download the slides and other related resources provided by our speakers. And there's also a survey icon, which you can click to share your feedback at any point during the session.

[00:02:11.03] - Adam Blair
Your input is extremely important to us. So before logging off today, please be sure to take a moment to share your feedback and help us improve future events. And you can also click on the speaker bio icon to connect with today's speakers on social. Last, I want to point out a few more clickable areas you can use to share this session. Learn more about upcoming events or ask for help. There's the Share icon to share the session with colleagues, and the Help icon here to help guide you through the experience. Today's session is slated for approximately 45 minutes, and as I mentioned, we will have time for audience questions at the end. Now I'm very happy to introduce our speakers. Mel Wilhelmi is Sunrise Technologies' Training Services Manager. In this role, Mel oversees the training of both Sunrise's consultants and customers on all the ins and outs of Dynamics 365. Prior to joining Sunrise's training department, Mel was a functional consultant on several Microsoft Dynamics 365 implementations for both retail and supply chain. Jason Wolf is a Director of Consulting for Sunrise Technologies. He has over 15 years of experience implementing Microsoft's Dynamic 365 for retail, distribution, and consumer goods companies.

[00:03:21.07] - Adam Blair
And while at Sunrise, Jason has participated in Dynamics 365 implementations for companies like Patagonia, Pet Supplies Plus, and Friedman's Home Improvement. Very pleased to welcome both Mel and Jason. Please take it away.

[00:03:36.14] - Mel Wilhelmi
All right, thanks a whole bunch. Adam, what's up, everybody? Mel and Jason here, and we are excited to chat about inventory visibility with you today. We both have a background in implementing both AX and Dynamics 365, and we definitely remember those days long ago when it was impossible to get even close to having more real time inventory visibility and how painful that was. But it has gotten a lot better. So let's take a look at the agenda here. We're going to cover some basics about inventory visibility and omnichannel since this group has a wide range of roles and experience levels. We will then talk about what happens when you have poor inventory visibility. Then we'll cover some steps that you can take to improve your company's inventory visibility. We also have a few customer stories that shows you some real world examples of what you're able to do once you have that visibility and how much it can improve your customer's whole shopping experience because that's really what it's all about. So let's get into it. Let's move on to our next slide here. So what does inventory visibility really mean? What are we talking about here?

[00:04:53.08] - Mel Wilhelmi
Inventory visibility refers to the ability to see and track your inventory. So what you have and where you have it across all your channels, such as stores, maybe with POSs in them, warehouses, holding your inventory for your e-commerce site, and maybe another warehouse holding your inventory for your call center, all of those things. But not only do you have to be able to see it, you also need to be able to gain actionable insights into that data to make inventory management decisions and help ease a customer's journey. So an example of that is during the whole end of your holiday time, you know your e-commerce orders have a huge uptick in activity. So you need to have more inventory available to service those orders during that time. But inventory visibility is also a bigger part of the picture, your company's omnichannel experience. So let's hear it from Jason on what omnichannel is all about. If we can move, there you go.

[00:05:57.00] - Jason Wolf
Thanks, Mel. And welcome, everybody. When we talk about the omnichannel experience, we mean more than just offering multiple channels to your customer, whether it's shoppinbrick-and-mortarg online through a traditional brick and mortar store, via social media and mobile, even mail order and telephone order. And yeah, that's still a thing. Omnichannel is about creating a seamless and consistent experience for your customer. And creating that experience requires a great deal of thought, but can be achieved by focusing on what your customers value the most. Now, first of all, customers are expecting retailers to offer the same products across channels, as well as know where and when they can get it. It's important to have an integrated system across all channels to enable this experience, and a fully integrated omnichannel solution is not always easy to implement. However, an integrated system links the digital world like an e-commerce site with the physical world, your retail stores, to create a consistent brand experience. And ideally, those two will complement each other. In the case of buy online, pick up in store, or click and collect, as we sometimes call it, it allows the customer to shop at home and retrieve the items at a time that is right for them.

[00:07:15.14] - Jason Wolf
But customers have grown accustomed to an easy and efficient order fulfillment experience more than ever before. In some cases, the customer may not even interact with a sales associate or step foot in your retail store, which makes thinking through that order fulfillment process so important. How will I ensure my store staff are notified promptly to fulfill a pickup order? How do I best direct my customers to the right pickup location? What signage do I need? How can I ensure I collect payment upon pickup effectively without requiring the customer to reopen their wallet? The entire process should feel well thought out and be very deliberate. But providing options like this can lead to giving you that single view of the customer that we're all looking for, regardless of which channel they shop in. And retailers like yourselves can give shoppers a more personalized experience and create deeper relationships with your customers. Let's go ahead and move on to the next slide and talk about when things go wrong.

[00:08:21.14] - Mel Wilhelmi
When things go wrong, what happens when you have poor inventory visibility? These are some pain points here that we have heard from some of our customers, and you might recognize some of these as well. So first of all, always feeling like you're behind the eight ball. Your inventory could be anywhere. You can't see what you've got and where you've got it. And in today's world, you could have stuff in a warehouse in California. It could be in a store in Florida or maybe another warehouse up in Maine. It could be all over the country. And then another one is the time I spend looking for inventory takes way too long. Think about all the hours that people are wasting over days and weeks trying to locate inventory when you don't have a really good visibility of it. That probably adds up to a lot of lost time. Like example, if I want this one particular red shirt for a customer and I don't have good visibility of my inventory, I'll be calling all of my 50 stores across the US, calling all the warehouses, looking for it so I could get them to them quickly.

[00:09:32.05] - Mel Wilhelmi
That's a really long time that you wasted doing something like that. And another one here, and that leads into this is the customer experience. So we mentioned this a little bit earlier, but your customers want to buy your stuff, right? And if you have issues with products being out of stock and you can't replenish them fast enough, or people keep hitting snags in the buying experience, that friction, that cart friction that they sometimes experience. If that happens, customers are probably going to go elsewhere real fast, especially since all of us have gotten so used to shopping being easy. An easy button for shopping, Ecomm, shopping on my phone from anywhere I need to be doing it from. When you lose them or any friction comes up, they're probably out of here. So you want to try to avoid that. But also in business, it's hard to trust what you can't see. So since you can't see et see your inventory very well, I bet you have a lack of trust in the numbers that you can see, right? And if that's the case, it's much harder to make decisions and be assured of them. All right, so let's move on to the next slide here.

[00:10:46.13] - Mel Wilhelmi
And we will start giving you some tips to get better inventory visibility. So now that we talked about the pain points and the disadvantages, gotten all the negative stuff out of the way, let's get positive. Let's talk about solutions. We're going to cover some steps you can take and things you can do to improve your inventory visibility, which leads to improving your buying experience for your customers and hopefully making all your operations run more smoothly. First tip, move to the next slide here. First tip, don't mess it up. You should just fight harder and get inventory visibility right. No, I'm just joking. The first tip really is to utilize a system that holds inventory information for all of your channels, such as an ERP system. Sounds like a no brainer, right? But it's so important that it's worth mentioning first. And this is a big one for Jason and I, since this is what we do every day. We implement ERP systems for customers. And ERP systems really are made to bring together sales and inventory and financials, all that good stuff into one spot. And automatically it has the ability to track the movement of inventory items.

[00:12:01.14] - Mel Wilhelmi
So if you have separate systems for multiple channels, it can lead to having multiple versions of one larger picture, multiple versions of the truth. That's not good. It's very difficult to make a plan, act on it and measure its effectiveness if you're operating on multiple versions of the truth. We only want one truth that we all work from. All right, we move on to the next slide here. The next tip is get the level of granularity you need for good visibility by utilizing the scanning of items. Also, again, sounds like a no brainer nowadays, but definitely worth mentioning, utilize scanning. When I'm talking about that, what I mean is scanning of items as they're received into the warehouse or the store, scanning them as they go along their journey in the warehouse, scanning them when they're sold with the POS or being shipped out to a customer, etc. So not only do you need to know what you have and where you have it, but what state it's in so you can track that journey as it goes along. Here's an example of my real personal life, my real personal shopping life where they don't use scanning.

[00:13:19.14] - Mel Wilhelmi
I go shopping at a large store that has many, many, many SKUs. Then I go and collect the items that I want and come up to the reg. They're not scanning them. And it's blowing my mind that we're in the year that we're in and they weren't scanning. They're typing in the price instead of scanning it. So not only are they having to type in prices, they're having to remember all their discounts that are going on and all the exclusions to those discounts, mind blowing amounts of information that that clerk has to remember. So that's not great either. But if you have that situation going on, that is a recipe for inventory disaster. But scanning is also going to let you to respond to things like product recalls, returns to vendor, regulatory reporting that you might have to do. So think about if you got a notice from one of your vendors that said, Hey, we have to recall all of these blue shirts, not the red shirts, because I like the red ones, all of these blue shirts. And if you have to do that within a couple of days and you don't have good inventory visibility, what you're going to do, right?

[00:14:27.08] - Mel Wilhelmi
You have to really get everybody on board and try to find all those items immediately. Drop what you're doing, stop selling in the store and locate these blue shirts. And that's not what we ever want. We do not want stores stopping to sell and being inventory clerks, we want them to sell. So scanning helps you get there. It also helps you do things like doing quality control as well. All right, moving on to the next slide. Next one, utilize BI, business intelligence. So with that new fancy ERP system that you got and the detailed scanning that you're doing, because you're doing the first two tips, right? Right. Yeah. Now it's time to utilize your Power BI, your Tableau, etc. That platform that your company spent a lot of money on, go use it. You can learn from all that data you have and get insights that you can take action on and make inventory decisions. Bi can really help you see your outliers by making rich visualizations. Perhaps that Power BI report is going to clue you in to the fact that you have 10,000 red shirts in Montana and the red shirts are really kicking in Texas, right?

[00:15:42.09] - Mel Wilhelmi
But you only have five in Texas and that demand is even going up. So that BI report is going to show you those outliers real fast. All right, moving to the next slide here. Next one, consider using inventory buffers, especially if your stores are fulfilling Buy online, pick up in store, or BOPIS is the acronym, or click and collect like Jason talked about earlier, or even if they are fulfilling ship to customer orders also. Since BOPIS and ship to customer orders have become so popular, you want to fulfill those orders, but you also want to make sure you keep some product on hand for people who walk into your stores. The last thing you want is a customer to come into your store, pick up that red shirt that's sitting there on the shelf, try to come up and pay for it at the cash grab, and that person at the clerk.

[00:16:40.08] - Jason Wolf
Says.

[00:16:41.00] - Mel Wilhelmi
Sorry, we can't sell this to you. It's being held aside for a possible online order. I don't think so. Nothing worse for customer service than that. But along with inventory buffers, you can also utilize something called inventory bans is what I like to call it. Basically, it's messaging to the customer regarding your on hand position to help you avoid that whole dreaded, Your website said there were five left and now you're telling me they're sold out? There's all kinds of attitude going on right there. We want to stop that. We want to please the customer. Bad customer service, they're walking to the next store down the street to pick up that red shirt and we don't want that to happen. So let's keep it going here. Let's move to our next slide and see what other tips we have.

[00:17:31.04] - Jason Wolf
All right, the next tip we have is near real time information. And having a near real time inventory picture is essential. Both Mel and I have lived through this experience where updating your inventory throughout the day across all channels just wasn't possible. The best you could do was at least a day behind, sometimes two. So we couldn't react as quickly to changes or trends that we might see. Keeping along that same scenario that Mel has been bringing up, consider a store in Texas selling red T shirts like hot cakes, but we only have a few left. On the other hand, our store in Colorado has plenty on the shelf remaining. We may want to move some product from the Colorado store to the Texas store so we don't sell out. Now, if your data is not up to date enough to jump on that trend, you're missing out on opportunities to prevent lost sales and disappointed customers. Now, I will say, real time information is relative and it should be carefully considered. Often an updated inventory picture of every 15 minutes or sometimes even an hour is sufficient for most retailers. Placing true real time inventory updates on an integrated system can create significant overhead that can often overshadow the advantages of having true real time updates.

[00:18:57.08] - Jason Wolf
Let's go ahead and move to the next slide. And our next tip is use of a demand forecasting tool. There are plenty of tools and methods out there, and although demand forecasting is never going to be 100 % accurate, it can certainly help you analyze and anticipate your customer's needs in the future. Demand forecasting helps ensure you have the right products in the right stores at the right time. Additionally, a demand forecasting tool can assist you with optimizing your inventory, so you increase that inventory turn and you keep the inventory on your shelf fresh. It can also help with decreasing your safety stock requirements. Demand forecasting is also deeply connected to inventory visibility. The greater inventory visibility you have, the more accuracy you can apply to your demand forecast. And our final tip is to ensure your on hand inventory is accurate. You know, Mel, in a recent study, I read the average level of inventory accuracy for US retailers is around 65 %. It's just the nature of the retail environment that makes inventory accuracy so difficult. Every item shipped, it needs to be unpacked, and we have dozens of people, both customers and employees, moving that merchandise on a daily basis, which is why it's so important to conduct regular cycle counts and physical inventories.

[00:20:27.04] - Jason Wolf
Now, I'm sure most of you are already doing this, but performing counts on a consistent basis gives you the reassurance that your on hand inventory picture is accurate and you can trust those numbers. And without doing these things, having visibility into your inventory doesn't mean much, and it can lead to the inability to fulfill orders accurately or even worse, canceling customer orders. And so let's go ahead and go to the next slide, and we're going to shift gears and jump into our customer stories.

[00:21:01.07] - Mel Wilhelmi
That's right. Let's start out with a story from 511 Tactical. If we can move to our next slide here. There we go. Our first example here from 511 tactical, they are a company that sells outdoor apparel, footwear and accessories. They have retail stores and an e-commerce site, and they have implemented Dynamics 365. But along with that, they needed a solution to help them improve their customer's experience on the shopping journey. Basically, they needed to answer the question of how do I get the correct items that my customer orders to them in the quickest time? That's what they were trying to go for. So if we can move on to the next slide here. So for that, we utilized a distributed order management system, or DOM, if you will. This system within D365 takes the inventory position of all the warehouses, all the stores, looks at the orders coming in from ecom and orders possibly placed in our stores on the POS to be shipped to a customer. It takes all that stuff in with a set of rules that we have in place for what it needs to do, and it brokers those orders out to find the best location to sort that order as possible.

[00:22:20.14] - Mel Wilhelmi
So this really came in handy during some of 5 11's biggest shopping days of the year. They had a big sale in May because it's 511, right? Get it? 5 May. And even with that huge spike in orders during that time, they were still able to fulfill them by using DOM. Because that system intelligently brokers the orders so everything didn't have to go through just the distribution center. And it also came in handy over those end end-of-yearof year holidays that we talked about at the beginning, because as I'm sure many of you have experienced during that Christmas and holiday shopping season, 511 also got a huge spike in orders at that time. But they were able to maintain that same great customer experience since they were able to quickly fulfill orders using all of the channels available to them. So if I place an order online at 511 during Christmas time or even right now, actually, then it might come to me from a store near where I live. Instead of coming from that old warehouse in Maine, which would take a really long time to get to me, whereas the store down the street who has it can ship it to me immediately.

[00:23:35.01] - Mel Wilhelmi
And when I get it, it just looks like it came from 511. I don't know it came from a store. And actually, as a customer, I don't really care. I just want my stuff and I want it now. And so that is what DOM helps you to do. So you can see that having a view of all the inventory and all the channels really enabled that to happen. So let's hear about another customer's story from Jason.

[00:24:02.14] - Jason Wolf
Here's a similar story about another one of our customers, Patagonia, and how having high inventory visibility helped them during the pandemic. Patagonia is a company that a lot of you may know in the outdoor apparel industry. We've been working with Patagonia for many years, first helping to implement an on prem ERP system with Microsoft Dynamics AX, and more recently, moving to a cloud based ERP with Microsoft Dynamics 365. Let's go ahead and move to the next slide here. And so in that move to Microsoft Dynamics 365, greater inventory visibility across all channels was paramount to Patagonia, and Dynamics 365 was able to offer such capabilities. Coupled with a distributed order management system just like Mel discussed, Patagonia was able to allow the system to intelligently broker these orders from any channel to the best fulfillment location based on product availability, delivery speed, and cost. The retail stores served as an extension of the main distribution center to provide the best possible order fulfillment rate to customers. And then the pandemic hit, and suddenly they have this massive demand from orders coming in from their website. Retail stores are closed and the DC is running with very limited staff.

[00:25:27.09] - Jason Wolf
It's impossible for them to fulfill the demand while keeping their employees safe. Patagonia had to pivot quickly and was able to execute in record time due to cross channel inventory visibility and the distributed order management model. By deploying skeleton crews in each retail store and quickly enabling curbside pickup, Patagonia was able to keep up with the demand while reducing the load on any one fulfillment location, all while continuing to provide a great customer experience. The stores effectively became mini warehouses. So what could have been a pretty disastrous situation for Patagonia ended up working out okay with these tools and capabilities in place. This is just one example of how inventory visibility was so important for Patagonia to quickly respond to a huge change in conditions and keep their business going. So let's go ahead and move to the next slide and we'll talk about some bonus content.

[00:26:30.06] - Mel Wilhelmi
Yes, bonus content. So on this webinar today, we've been speaking very broadly about inventory visibility and omnichannel as a whole. But since Jason and I both work with Microsoft Dynamics 365, we wanted to talk a little bit about a feature that it has called the inventory visibility add in. I know it's a pretty obvious name, but that has a lot of the core functionality that we've been talking about. Inventory Visibility and D365 is an add-in that makes it far easier for you to share and send inventory for systems that are not necessarily that ERP, D365. It could be other systems. So for example, maybe you have a system for your call center and a system for Ecomm and a system for POS, and they haven't all been put into the same ERP yet, but you're using something over here, something over there, that inventory visibility add in can let you pull all those systems together so you can see your inventory levels in one centralized place. It's also going to let you see your ATP. You're available to promise and help you to make soft reservations against that inventory to avoid overselling, which is excellent.

[00:27:45.08] - Mel Wilhelmi
We have a link for that. If you're interested, just let us know and we can send it on. All right, moving on to our next slide here. I think that is it. That's all we have for you today. So we're happy to answer any questions you folks might have. If you'd like to talk more about anything we share today, you can email us. Our email addresses are on the slide here. And thank you very much for hanging out with us. And we'll hand it back over to Adam.

[00:28:16.03] - Adam Blair
Thanks so much, Mel and Jason. We did get some questions in from the audience, which is great, but there's still time. If you have things you'd like to ask either of the speakers, you can use the widget to type them in. If we don't get to your question, we'll pass them along to the speakers. The first question says, My company has a delay in getting transactions posted, such as orders coming in from e-commerce being turned into actual orders in our inventory system. What are your suggestions?

[00:28:46.00] - Mel Wilhelmi
That's a good one. A mantra I live by for this is post those transactions, post haste. If you leave those things too long, it really opens you up to overselling and over promising to other customers. And leaving it too long makes it even hard to have that good pulse on the inventory itself.

[00:29:08.07] - Adam Blair
Got it. Okay, we've got another question. How can I get good usage of my inventory visibility across all the countries my company has presence in? So I guess they're an international retailer.

[00:29:23.04] - Mel Wilhelmi
Yeah, well, the first tip actually matches our first tip on our presentation there of use a good ERP system that can track your inventory in each of your countries to get that global view of your near real time inventory position. But when it comes to doing things like a customer in the UK buys an item on the ecom site, and then you might want to try shipping that to them from, say, like Nevada, that is not as easy as it sounds. So you can have that visibility for sure. But beware of the idea of multinational fulfillment of orders. Customers trust of paperwork, duties, and all that stuff are never that straightforward. Believe me, I've lived that before.

[00:30:07.04] - Adam Blair
All right. So proceed with caution sounds like it's the answer with that one. Yeah. Okay. All right. We got another question. Here we go. How often do you suggest doing things like cycle counts and physical inventories to ensure your inventory position is trustworthy?

[00:30:25.08] - Mel Wilhelmi
This one. This is close to my heart right here. This one depends on your company and how tolerant you are for these kinds of activities. They do take some time to pull off, so don't discount that. But doing them on a regular cadence is very important, and I mean regular cadence. For example, most companies do full physical inventories of each of their stores and warehouses about every 10 months or so, and maybe even more frequently in their high shrink areas. And for cycle counts, it's really useful to set a schedule that your stores and warehouses follow each week. So perhaps on Mondays, they have to count all the items in zone A because they're very high valued items and we want to make sure they're not disappearing. Then maybe on Tuesday, they have to go through the store and put in correction counts for things that are holes on their shelves, things where something should be and there's nothing. And so they need to tell the system, I have nothing of this item because perhaps it thinks we have five and somebody stole all five, so it's not replenishing. We got to help. We got to correct that count for the system.

[00:31:35.08] - Mel Wilhelmi
And then perhaps on Wednesdays, they have to count all the items in the back room, whatever it is. It's a regular cadence that they do each week. That's what you're going for here. Got it.

[00:31:50.02] - Adam Blair
Okay, we do have another question. This is interesting. How can I know how real time is near real enough time for my company? As in, how do I get to that without going overboard? I guess that's the question of how close does it have to be to actual real time to be effective? Okay.

[00:32:11.02] - Mel Wilhelmi
Well, Jason, you want to take a shot at that one? I know you know a lot about this. Oh, yeah.

[00:32:15.04] - Jason Wolf
I'll take a shot at this one. So I think really, ultimately, what it comes down to is it's really about finding that sweet spot, and it's going to differ depending on the company. There's a couple of factors that I like to look at. First and foremost is understanding your order volume. So how frequent are orders flowing into your system can really drive how often you need to get your inventory updated. I'll give you an example. Looking at a high end fashion retailer, perhaps their transactions are high dollar, but they're very low transaction count. In that situation, I don't need to have such a near real time update of inventory because the inventory picture isn't changing as frequently as it is for some of the high transaction retailers that are out there. Another one to look at is system performance. And so you have to understand, maybe I have a very large skew count. And so to update an inventory picture out to external systems is going to take a lot longer. So I need to look at the bigger picture and understand not only the system performance, but also my order of volume. And then based on those metrics, try to come up with a good number that's going to meet your business requirements.

[00:33:30.09] - Jason Wolf
Got it.

[00:33:32.12] - Adam Blair
Okay. Well, unfortunately, we've run out of time, but I want to thank Jason and Mel for a really fascinating presentation. I want to thank Sunrise Technologies for their sponsorship of the session. Attendees, I want to thank you also for attending. You can catch our next Retail Strategy and Planning series session, which is Leveraging Customer Data to Create Seamless, Differentiated experiences in Store and online. That's going to begin at 3 PM Eastern Time today. And you can also access any of the RSP sessions on demand by clicking the link at the bottom of this slide. Thanks all and I hope everyone has a great day.