Retailers prefer inventory management software that they can customize — here’s why

According to Statista, global retail sales totalled approximately $23.74 trillion USD in 2020 and are projected to reach $31.7 trillion USD by 2025. That’s a lot of buying and selling of goods, but more importantly, it represents a lot of inventory, a massive amount of inventory. All that inventory has to be managed, and the best way to do this is by using software that’s designed for the job. If you’re a retailer looking to upgrade your system, you should take a look at Cin7. There are many reasons to consider Cin7, but one of the most important is its flexibility — its ability to be adapted to fit your company’s needs while operating within your digital network.

 

What is retail inventory management?

Inventory management entails determining the quantity of goods or materials a company needs to have on hand to satisfy customer demand. For retail businesses, this is a more complicated process than it is for manufacturing ones. Which is why the software that retailers choose for managing their inventory needs to be able to perform at a high level. In other words, the software has to have the ability to be configured so that it can perform increasingly complex operations. Let’s take a look at the main ways retailers can benefit from inventory management software that has advanced configuration options.

The ability to customize the number of staff who can use the system

Inventory management software usually puts limits on the number of staff who can access the system. This is fine for smaller retailers, but for larger ones that may have multiple outlets, flexibility is key. Cin7 offers a Small Business Plan that gives access to two users, and an Advanced Plan that allows up to eight. But our software can increase that number to whatever your company needs. We call this our Enterprise Plan.

Keeping oversight on stock when using 3PL and being able to handle multiple EDI systems

Third-party logistics (3PL) basically means outsourcing. It’s when a retailer hires another company – a third party – to take care of its fulfillment. The business arrangement may even extend to warehousing. 3PL is especially useful for retailers that sell on multiple online and offline channels. Since manually tracking your inventory on numerous 3PL platforms and outlets is an enormous challenge, it’s important to have software that can do the job. Cin7 has a specific 3PL management feature that helps you administer your inventory stored in any third-party locations from your device. It not only helps you in optimizing your inventory but also speeds up the administrative tasks.

Electronic data interchange (EDI) is the process by which information stored in a computer system is electronically transferred to another computer system. EDI converts the information into a standardized format that can be read by different computer systems.

With the help of EDI, organizations can talk to each other over a standardized set of communication protocols. This helps avoid any inaccuracies that may arise while communicating via non-standardized formats.

Integrated warehouse management

Warehousing is one of the most complicated parts of a retail business. Sometimes a business handles products that need to be stored in different conditions within one space; other times the quantity of goods and size of the business calls for several of these holding areas, which could be in completely different locations. For instance, when a grocery store organizes its warehousing, the food has to be kept at specific temperature and humidity levels. Cin7’s inventory management system can organize all of that. For businesses that have multiple storage locations to oversee, Cin7 can be configured to keep track of the inventory in each one, giving you complete oversight.

Dedicated support and implementation

Cin7’s inventory management system and its Advanced Configuration Plan come with full support. We offer strong customer service to answer any questions you have and resolve any software issues you encounter. This kind of care can be the difference between having your inventory management system run OK and having it run really well.

Customer satisfaction

The main aim of an ecommerce retailer is to provide quality goods on time. If either of these things don’t happen, the business is likely to get a bad reputation and could lose its customers. A reliable inventory management system can prevent this from happening. It will make sure your items are delivered when promised, and it will prevent any out-of-date items from being sent out in the first place. With customer reviews being a mainstay of online sales, having a software system that can organize your business processes to ensure happy customers will not only keep them coming back to you, it will attract new ones.

 

Final note

Cin7’s advanced configuration for its inventory management system can be of great benefit to any business owner, but it is especially helpful for retailers. Its compartmentalized framework of features, which allows you to select only those you need, and the ability to have these features work together and within your computer network, can increase your profits and improve your customer satisfaction.  If you want to know more about Cin7’s Advanced Configuration Plan, call one of our experts today and request a consultation.

Think loyalty programs are just a cheap discounting tactic? Read this.

Fact or Fiction? Loyalty programs use discount tactics, which cheapens your brand. 

If you’re not playing in the discount market (where it’s pretty much a race to the bottom), you might be wary of discounting. Many retailers hesitate to use discount tactics, even sparingly. They worry that it might cheapen their brand and devalue their stock in the long run.

However, if brand perception is what you’re worried about, loyalty marketing can actually provide many of the benefits of discounting without devaluing your product.

What is loyalty marketing?

Loyalty marketing is a marketing strategy that retailers of all sizes use to increase the lifetime value of their customers, by incentivizing and rewarding repeat purchasing.

Loyalty marketing is both:

  1. A simple value exchange for capturing customer data and growing a customer database; and
  2. A targeted rewards system which can be used to incentivize repeat purchasing and recognise the value of individual customer relationships.

Many retailers are wary of old-school discount tactics. The fear is that these tactics will bring in customers looking for the cheapest price—almost by definition, these people are the least likely to establish an ongoing relationship with merchants.

Instead, retailers can use loyalty marketing to offer discounts on a sliding scale: the more customers spend, the more they benefit from the program.

How loyalty marketing drives revenue growth

Here are six ways loyalty marketing helps your bottom line.

Fashion store owner folding clothes for customer at checkout counter. Woman assisting female shopper at fashion shop checkout.

Data-driven marketing improves ROI

The value of a known customer can be measured, an anonymous customer can not. Loyalty programs give you a method of capturing the customer data required to measure and increase the value of each customer.

Regulars spend more per order than infrequent customers

Customers who come back, again and again, love your brand and are willing to spend more. According to research by BIA/Kelsey and Manta, regular customers spend 67% more per order than one-off or infrequent customers.

Loyalty marketing impacts price perception

According to a study by KPMG, 60% of consumers will buy from a store with slightly higher prices if they will earn a loyalty program reward. More than 65% of customers even admitted making special trip to redeem a free gift from a loyalty program.

Customers have a reason to choose you over a competitor

Loyalty marketing influences the consumer decision-making process. Convenience, price and travel time all play a part in the consideration process. But if a customer has points to redeem at your store, that plays in your favour.

Loyalty marketing creates positive customer experiences

75% of consumers would give “rave reviews” to a loyalty program they’re involved in. Loyalty programs help establish a feeling of reciprocity, an important function of any brand-customer relationship. When customers feel valued, they’re more likely to keep coming back.

You will attract more people similar to your best customers

Loyalty marketing helps brands acquire new customers through referrals. Loyal customers generate word-of-mouth and referrals, so you will build an ever-widening network of new customers similar to your regulars (their friends, family or workmates).

Top 3 loyalty marketing tactics

Here are three of the most effective tactics loyalty marketers use to incentivize repeat business, drive up average order size and increase customer lifetime value.

1. Tiered loyalty programs

One of the benefits of loyalty programs is that you retailers can ‘gate’ discounts, only offering rewards to people who spend above a specified threshold.

Tiered loyalty programs take this concept a step further. Tiers reward the highest-value and most frequent customers with the best gifts or discounts. The most widely known application of tiered loyalty is airline points. Airlines offer tiers like “bronze”, “silver” or “gold” status levels to reward customers in different spending brackets. This incentivizes customers to move up through the ranks to earn higher value rewards.

Done right, a tiered loyalty program will offer genuine value to your customers, whether they’re shopping in-store or online.

Federation + sees 10% revenue boost from loyalty marketing alone

Cin7 customer Federation uses Marsello for their tiered loyalty program, Federation +. Their points and reward options incentivize customers to move up through the levels—Silver, Gold, and Platinum.

Since activating the tiered program, Federation have seen their repeat purchase rate jump to 20%. The loyalty program has led to a 10% increase in total revenue.

2. RFM segmentation

RFM stands for recency, frequency and monetary value. RFM segmentation uses all these factors to categorize a customer database into groups. Customers in a brand’s top segment have purchased recently, make regular transactions, and are in the top percentile of lifetime value.

You can use RFM segmentation to group your database, provided you have purchase data attributed to unique customers.

If you have trouble collecting or tracking this data, a loyalty program provides a fantastic incentive for customers to self-identify. A loyalty program will also drive customers into your most engaged segments by incentivizing repeat purchases.

You can also use your loyalty program tier lists or RFM segments to send one-off campaigns. PB Tech sends occasional rewards like free shipping codes to incentivize repeat purchases. You can tailor your promotions to suit the customer group—giving the most exclusive offers to your best customers.

3. Referral programs

Referral programs encourage existing customers to share your brand with their friends in exchange for loyalty points or rewards. That direct referral is highly influential—people are as much as 4x more likely to buy when referred by a friend.

Loyal customers are a powerful marketing asset. Incentivize customers to tell their friends about your store with a referral program to help you acquire more like-minded customers. You’ll tap into the potential of your customers’ networks (their friends, family or work colleagues), connecting you with consumers who are more likely to love your brand!

Key takeaways

Loyalty marketing elevates brand experience

With a bit of planning and effort, a loyalty program augments the customer experience and leaves them feeling valued.

You can collect data with a loyalty program

We know that our regulars are our most valuable customers. But do you know who they are? Could you send them an email? Or an SMS? To actually market to your most valuable customers, you need to know who their customers are, how much they’re spending, and how to reach them. A loyalty program offers an incentive for customers to self-identify at purchase, so you can collect this information.

Customer data will provide marketing insight

If you’re collecting that data—that’s great! Use your top loyalty tiers or RFM segments to offer personalized offers to your highest value customers.

Get started with Cin7 + Marsello

Powered by Cin7 and your e-commerce data, Marsello works seamlessly in-store and online to provide a true omnichannel customer experience.

  • Capture in-store and online customer details
  • Deliver personalized and timely automated marketing
  • Incentivize repeat purchases with email, SMS, a loyalty program, and more
  • Grow your average basket size with advanced product recommendations
  • Accurately track and attribute sales to your marketing activity

Learn more

What is 3PL fulfillment?

Fulfilling customer orders is a significant part of any business. This order-fulfillment process starts when the customer places an order and ends when it’s delivered to the doorstep.

Many companies facilitate fulfillment by using a third-party logistics (3PL) company. 3PL providers can manage the entire supply-chain process from warehousing to fulfillment. In addition to these services, 3PL can also take care of inventory forecasting. Outsourcing through a 3PL is a good solution when a business grows and is no longer able to handle its order-fulfillment processes in-house.

For any 3PL fulfillment company, there are five basic stages of the fulfillment process. The company retrieves items for the order from the warehouse, then picks, packs, ships and delivers them. Let’s better understand the steps involved to get the right product to the right customer at the right time.

 

5 stages of 3PL fulfillment

1. Receiving

Even before an order is placed, inventory has to be stocked in a warehouse. If it isn’t there, or if there isn’t enough of it, orders can’t be fulfilled. When the 3PL receives inventory for its warehouse, it will typically fill out a Warehouse Receiving Order (WRO), a document that lists the names of the items and their quantity.

After this, each item undergoes a quality check and has its barcode scanned. By doing this, the 3PL company can check the accuracy of the WRO and make sure that items are stored in the right bins. This is an essential part of their warehousing.

The process is facilitated by state-of-the-art software, such as Cin7’s warehouse-management software, which takes care of managing the inventory the 3PL holds and its warehouse operations.

2. Picking

When a customer’s order is ready to be filled, the Warehouse Management System (WMS) produces a list of the items, called a picklist, and assigns a warehouse associate to pick each of the items from their respective storage bins. To ensure the associate picks the items in the most efficient way—one that takes the most direct route around the warehouse and entails the least amount of walking—a picking pattern is produced. The software easily generates both the picklists and picking patterns.

When picking has been completed, the items of an order are scanned and set aside for packing.

3. Packing

At the packaging station, a team places the items for an order in a box and pads them with appropriate packing materials such as bubble wrap. Ideally, the 3PL fulfillment provider will choose packing material that is secure, yet lightweight enough to keep shipping expenses low. A seller can also usually ask for special packaging to be used. Once packed, the whole box is sealed tight with tape and a shipping label is attached. This contains all the information necessary to get the goods to the customer. At this stage, the packing department will also make sure that the weight and dimensions they have for the package are correct.

4. Shipping

Before being shipped, packages ready for dispatch are separated into their destination areas. This way, all packages intended for a particular geographical area are put together on the same transportation.

At this stage, the 3PL company can either take care of shipping and delivery for you, or you can arrange for a courier company like UPS or FedEx yourself. If your company is small and you don’t have many packages to deliver, it’s usually a good idea to have your 3PL take care of shipping because they will have negotiated good rates with the carriers. They will also know which shipping method to use to get your goods to your customers in the fastest time possible.

5. Returns

Returns and refunds are a fact of life, especially in online retailing where the customer doesn’t actually see the product they’ve bought until it arrives. For whatever reason a product is returned, there has to be a way for it to be done hassle-free. This ensures customer satisfaction. A good way of streamlining returns is to have your 3PL include a return label with the item they’re shipping.

Your 3PL fulfillment provider should make sure that each item they handle is in perfect order before sending it out. When an item is returned, its condition should be checked again and documented. Based on company policy, an item in good condition will either be placed back in the warehouse or be disposed of.

 

How to have a good 3PL experience

The best way for you to have a good experience from your 3PL is by being able to have oversight. If you have Cin7, you’re able to check on your inventory that’s in their warehouse in real time, know what orders are coming in from which sales channel, and batch track. Batch tracking lets you know things like which group of items a defective one came from and when expiration dates have been reached. Cin7 software will also give you advanced reporting on all aspects of the fulfillment process. Why not book a demo with our experts today?

5 elements of an optimized inventory management system

Retail businesses have an average of 20% inventory to sales ratio. This I/S ratio compares the value of your inventory with the amount you make from selling your goods. The I/S ratio is arrived at by dividing the revenue made from overall sales by the value of the stock that’s kept. So, with a 20% I/S ratio, if you make $100 from selling your items, your stock would be valued at $20. More simply, the I/S ratio here would be five (revenue made from sales divided by value of stock). Maintaining the I/S ratio that’s best for your business is key to maximizing profit. If there’s too much stock, profits are compromised; if there’s too little stock, orders might not be filled. Optimization is the key. What are the best ways to optimize inventory? And, what are the five elements of an optimized inventory management system? Let’s find out.

If you are a businessperson, deciding the amount of inventory you should keep on hand is crucial. If your stock runs out, or if you have too much of it, the consequences could be serious. There could be financial losses and your reputation could be damaged. The only way to avoid this is by having optimum inventory on hand, or the right amount you need. This article will help you to understand what inventory optimization is and explain the five elements of an optimized inventory management system.

 

What is inventory optimization?

Inventory optimization means maintaining an optimum amount of stock, stock being defined as all the stock-keeping units (SKUs) that are being held by a business. When a company has an optimum level of stock, its working capital is being used to its best advantage.

Overstocking inventory can result in

  • Working capital being tied up in unneeded stock.
  • Stock going out of fashion and becoming unsellable.
  • Workers spending time and energy unnecessarily.
  • An elevated risk of loss of goods to theft or accidents.
  • Valuable storage space being used unnecessarily.

On the other hand, understocking and stockouts can result in

  • Turnover being halted.
  • Company reputation being damaged.
  • Production lines being broken.
  • Workers’ time being lost.

Inventory optimization can eliminate these losses. Put another way, when optimal levels of inventory are maintained, resources, like physical space, labor, and capital, can be used in their most efficient ways.

 

5 elements of an optimized inventory management system

As we saw earlier, it is crucial to optimize the amount of inventory you keep at all times. But in order to do this right, what should you be focusing on? Let’s look at the key areas in detail.

Graded policies for inventory management

First, your stock policies should be clearly defined, and you should let the relevant people know about them well in advance. It isn’t helpful if the purchasing department is kept in the dark about these policies.

The inventory turnover ratio indicates the liquidity of the inventory, or the number of times the average inventory is sold during the year. It shows the efficiency and effectiveness of the company in investing its funds.

Inventory turnover time is the number of times a company replenishes its stock in a given period, generally a year. In other words, if you sell stainless steel spoons, the inventory turnover of finished product — spoons — is the number of times you sell out of spoons and replace them. The following formula shows how to calculate the inventory turnover ratio:

Inventory turnover ratio = Cost of goods sold
Average value of inventory

 

where,

Average inventory = Opening inventory + closing inventory
2

Cost of goods sold = Opening inventory + purchase – closing inventory

Now you know how many times a year you have to refill your inventory. The following categories of inventory are dependent on this ratio.

  • Fast moving – Fast-moving inventory is that which is used or sold in a short or easily known period of time. This period is different for every industry. The inventory turnover ratio will be higher for goods in this category.
  • Slow moving – Slow-moving goods are those that stay in your warehouse for a more extended period of time. The inventory turnover ratio for these types of goods will be lower.
  • Non-moving – Non-moving or obsolete goods are those stored in your warehouse for a long time because there is no market for them. This inventory is also known as dead stock.

These three categories should be a major consideration when making purchases. Separate your stock into each one, and invest more in goods that are fast moving than those that are slow-moving.

Realistic demand forecasting

Forecasting demand is, perhaps, the first step when it comes to good inventory management. Forecasting demand accurately is not an easy task, however. There are many aspects that have to be considered: historical sales data, customer biases, future demand, and growth. Additionally, it is crucial to take technological advances and trends into account.

How can you predict demand for your products accurately? Well, quality software can help. Cin7’s system generates reliable demand forecasting reports. Cin 7’s forecasting demand report can make your job a lot easier.

Determining product life cycle

The term product life cycle is defined as the period between the product’s initial production to the time it is no longer sold. If you launch a new product, sooner or later it will stop trending and your customers will move on to something else. There are five stages to a product’s life cycle that impact your inventory management:

  • Introduction – There is less awareness at this stage, so the demand is less, and there is no need to stock a lot of products.
  • Growth – Awareness of the product is on the rise, and the company should be prepared to fill more orders.
  • Maturity – This is when demand reaches a plateau. Demand will still be high, so the company won’t have to make changes to the level of stock it maintains.
  • Decline – Here, the company realizes that demand is dropping. Customers have had enough of the product and are buying less of it. When this point is reached, the company needs to reduce production and focus on replacing it with something new. This is also the time to push more of the product by offering discounts and rewards.
  • Obsolete – Now the product is totally out of demand. Any remaining inventory you have becomes dead stock.

The life cycle of a product can be short (a few months) or long (spread over years). These life cycles have to be taken into account when forecasting demand for your product. Doing this accurately will prevent overstocking or understocking,

Timely restocking

Your purchase department should have clear restocking instructions. Every item in the inventory should have a specific reorder point (ROP), a predetermined level of goods at which they have to be restocked. When determining this reorder point, you should consider:

  • Safety level for stock: This is the minimum amount you will need on hand to tide you over until your new order arrives. You don’t want to run out of stock.
  • Logistics: You have to consider the time it takes to get your goods to your factory or warehouse.
  • External factors: These include weather, political upheavals, and labor issues. Any one of them can affect your delivery time.
  • Supplier lead time: This is the time it takes your supplier to dispatch your products. Suppliers have different lead times.

Management needs to be aware of ROP to ensure stock is replaced in a timely manner. Inventory management software like Cin7 can send alerts that let you know when you reach this ROP.

Investing in reliable inventory management software

If you find inventory management challenging and are intimidated by the sheer number of calculations that have to be made, here’s an easy solution: Cin7. This versatile and easy-to-use software can help you manage your inventory easily. Among the features it has to make your life easier are

  • Determining reorder levels,
  • Alerting you when you reach ROP,
  • Sorting third-party logistics (3PL),
  • Helping you with B2B ecommerce,
  • Generating reports on COGS, forecasting, cashflows, and inventory on hand, and
  • Integrating with other software and mobile OS.

The following video shows how Cin7 inventory management software can help you take your business to the next level:

One of the significant advantages of Cin7 is its inventory management app. This app lets you connect to your inventory management program from anywhere.

 

Final take on inventory optimization

While inventory optimization is a crucial element of a successful business, it is also painstakingly tricky and complex. Overstocking can lead to losses, while understocking can damage your reputation. How can you overcome these dilemmas? Cin7 inventory management software turns the whole ordeal into a piece of cake.

Why wait? Contact our experts for a demo, and unlock the true potential of your inventory.

12 reasons why using the Cin7 inventory management system for your Amazon business is beneficial

Amazon.com is undoubtedly the number one name in ecommerce. It has dwarfed every other ecommerce platform. Thus, if you are thinking about becoming —or already are — an Amazon seller, you are on the right path to increasing your turnover. How can we help take you further? Here are 12 reasons why using the Cin7 inventory management system for your Amazon business is beneficial.

 

Reason 1: Centralized inventory management

How would you feel if you bought something on Amazon and received an email two days later telling you that your item was out of stock? Not good, right? You probably wouldn’t order from that supplier ever again.

If you are a supplier, you wouldn’t want any of your customers to go through that experience.

As a supplier, you might be selling on multiple channels. Without a centralized inventory management system, you might find yourself selling a particular product on more than one of these channels simultaneously, possibly overselling and leaving you unable to fulfill orders. The damage to your reputation as a business that a miscalculation like this can cause cannot be overstated, but it is something that can be easily avoided.

Cin7’s inventory management software allows you to maintain multiple points of sale – either physical or online – on a single system. It updates your inventory in real time on all platforms. This real-time inventory accounts for sales, purchases, transfers, and loss of goods.

 

Reason 2: Higher visibility

When you have an integrated inventory management system, you have a holistic view of your inventory, a complete overview that clearly shows you what’s been purchased, sold, and is on hand. It also lets you know the exact point at which you need to reorder stock.

An added benefit of Cin7 software is that it gives you up-to-date sales figures for each platform you use. When it comes to Amazon, Cin7’s software has an integration tool that tells you exactly how much you’re selling on that marketplace and when a sale has taken place. This information – found on your Cin7 reports – lets you know when to increase or decrease your inventory. The result: profit maximization for your company.

 

Reason 3: Cost control

If you use Amazon Central, you can add or delete your listings on its Excel sheet online. However, those changes only apply to Amazon.com. They won’t have any effect on other selling platforms you use. To do that, you’ll have to make changes to each platform you use individually.

If you use Cin7’s inventory management system, however, you can add or delete an item with just one click. The software lets you make alterations to your stock on all the platforms you use simultaneously. Being able to do this not only reduces administrative efforts, it can drastically lower your cost.

 

Reason 4: Product identification

Barcodes and radio frequency identification (RFID) tags uniquely identify every product in the inventory. This type of identification provides product details, including size, color, material, and warehousing information. These barcodes and RFID tags help keep track of your product as it moves through the system, meaning that you’ll know where an item is at all times. It also means you’ll be made aware if something is lost or stolen.

 

Reason 5: Reports and forecasting

Inventory management systems have a specific feature called reports and forecasting. The Cin7 software has higher accuracy in forecasting than others. The way it works is that the system tracks the historical data entered and uses it to make predictions about future needs for your business.

These forecasts apply to inventory needs and sales predictions on every platform. Reports of this kind help you make better business decisions, decisions that will lead to greater success.

Suppose you only sell on Amazon and use Amazon Central to manage your inventory. While that’s OK on one level, Amazon’s system won’t let you analyze your stock as easily as you could with a general inventory management system. The deeper knowledge a general inventory management system can give, like forecasting and detailed reporting, allows you to make informed decisions that could help grow your business.

 

Reason 6: Assisted decision making

Strategic decision making is probably one of the most complex, and important, parts of running a business. The key issue is to place orders in such a way that your products are neither overstocked nor understocked. Cin7’s inventory management system can help with these decisions by:

  • Calculating reorder points (ROP) for each of your products.
  • Giving alerts when the stock reaches ROP.
  • Programming automatic reorder emails that are sent to suppliers when the stock reaches the ROP.
  • Tracking price changes.
  • Tracking the inventory on each selling channel.

The inventory management system can ensure you don’t run out of stock on any platform, including Amazon. It can also reduce the time involved in making decisions about reordering.

 

Reason 7: Integrations

A first-rate inventory management system allows integrations with third-party software and apps. If your inventory management system doesn’t work with other apps you use in your daily routine, you will find yourself in trouble. Cin7 integrates with over 700 apps.

 

Reason 8: Payment portal

Cin7’s inventory management systems has an integrated payment portal that can receive online payments. This helps you maintain account receivables, handle orders through the supply chain, and email invoices to customers. Automating the payment portal speeds up the payment process and fulfillment of the order. The system also lets you email payment links to customers. This not only provides an easy-payment method for customers, it gives them an instant confirmation of their order, assuring them that they can trust you.

 

Reason 9: Customer satisfaction

Customers who don’t have issues to face when they make a purchase, like problems with delivery and payment, tend to develop trust in you as a seller and are more likely to return for their next purchase. Cin7’s inventory management system takes care of all these aspects of your business, which promotes maximum customer satisfaction. This frees you up to concentrate on improving the quality of your products.

Satisfied customers don’t just give you repeat orders, they are also more likely to give you positive feedback online, helping to attract new customers. Increasing your overall customer base this way will lead to higher turnover. Online reviews, in fact, are very important to online marketplaces. With Amazon, for instance, it’s been observed that 90% of customers typically read reviews before visiting a business or making product decisions.

 

Reason 10: Calculation of Amazon commission

Amazon lets you sell your products on their platform for a commission. When customers make a purchase from the Amazon website, the full amount they pay goes to the online marketplace. Before Amazon passes that money on to the seller, they deduct their commission. The calculations for these sales and commissions are straightforward if you only sell a couple of products. But they become more complicated the more your business grows. Cin7’s inventory management software reduces your calculation woes. It will help you track your sales and keep on top of commissions Amazon has deducted.

 

Reason 11: Fulfillment by Amazon (FBA)

Amazon has warehouses that can store and ship your products to your customers for an extra charge. The system is called Fulfillment by Amazon or FBA. If you choose to sell your products through FBA, Cin7’s inventory management system will let you track:

  • FBA shipping plans,
  • Route orders for dispatch from the stock location closest to the customer, and
  • Direct Fulfillment (for Amazon Vendor).

The processes for selling, shipping, and payments can be made easier when you use a reputable inventory management system for Amazon sales.

 

Reason 12: Built-in electronic data interchange (EDI)

Electronic data interchange (EDI) is the electronic exchange of information between two or more companies in a standardized format. An Amazon seller is a person who sells goods they manufacture. An Amazon vendor is a business who resells or trades goods manufactured by somebody else. The customer is fully aware if they’re buying from a manufacturer, the seller, or a vendor.

If you’re a manufacturer and you have multiple vendors, it can be difficult to manage their accounts and keep track of the stock they have. Cin7 Amazon integration helps you by managing the EDI with your vendors easily. It allows you to do the following:

  • Product mapping,
  • Order downloads,
  • Order status updates,
  • Stock adjustments,
  • Stock availability, and
  • Bill of materials (BOMs) for product bundles.

Thus, whether you’re a manufacturer with multiple vendors or are a vendor with multiple suppliers, Cin7’s inventory management software makes it easier to run your business.

 

Final thoughts on 12 reasons why using the Cin7 inventory management system for your Amazon business is beneficial

A reliable inventory management system should reduce administrative expenses and clerical tasks. If you sell on multiple channels, being able to organize your inventory to make sure you aren’t overstocked or understocked is crucial.

Amazon is one of the biggest ecommerce platforms, and listing your products with them can widen your market. Using a Cin7’s inventory management system is a good way of managing your online and offline points of sales. It helps you stay on top of every stage of your selling business, from buying your inventory to fulfilling your orders.

Contact us today for a demo of the Cin7 software.

Merrell NZ: How to build a highly engaged customer base

This is a guest blog post written by Cin7 partner, Marsello. Learn more about our partner program.

Email marketing is a key sales tactic for retailers and product sellers, so it’s important to have an active, responsive database. That means consistent or growing engagement (open and click rates), a high repeat purchase rate, and growing average customer lifetime value.

In this article, we’ll look at how Cin7 and Marsello customer Merrell NZ builds their customer database, which boasts a 15% repeat purchase rate and an average purchase frequency of 3.5x.

Did you know? 50% of consumers buy from marketing emails at least once per month, and 59% say that marketing emails influence their purchase decisions (Salecycle, 2022).

How to build a highly engaged customer base

1. Collect high quality contacts

Merrell NZ use a clever tactic to ensure the best quality contacts are added to their database: They ask for more than just an email address.

This might seem contradictory — surely the more information you ask for, the fewer leads you get? But Merrell NZ know that their most valuable customers are those who are willing to give just a bit more information.

This pop-up has a 25% sign-up rate. That’s incredible.

Here’s why the pop-up works:

  • It gets to the point in the first two sentences.
  • It’s aligned with Merrell’s beautiful, down-to-earth brand.
  • It offers VIP rewards in return for contact information (and everyone knows giving your date of birth means birthday goodies!)

For a business that understands how valuable its database is, this tactic is perfect.

Top 3 Pop-Up Mistakes:

  • No offer, promise of value, or incentive
  • No obvious purpose (too wordy, or an unclear offer)
  • Poor user experience (for example, it’s hard to get the pop-up to close)

2. Leverage email automation

Merrell NZ is building even stronger relationships with their customers with automations. Triggered when customers take a specific action or meet certain criteria, automated emails help Merrell NZ deliver a highly personalized customer experience.

Marsello “gives us the opportunity to link customers from our retail and web stores, work around customer retention and automate email marketing flows in a really clever way,” says José Matiz, Retail Manager for Merrell NZ.

“For us, Marsello was a game-changer, we have been using it for over a year. We started with email marketing and now moved on to loyalty programs and several automations, it’s amazing,” says José.

Above: Merrell NZ’s abandoned cart automation, set up in Marsello.

Automated emails, triggered by a customer action, get 8 times more opens than manual, bulk emails. Here are two very effective automations you can set up in just a few clicks:

  • Welcome emails: More than 80% of consumers will open a welcome email, and these automated welcome emails see up to 10 times more clicks than other manual emails. You can deliver immediate value with a thank you discount or voucher to make a great first impression, introduce them to your brand, and encourage them to buy again.
  • Abandoned cart emails: Send a friendly reminder to customers if they abandon their cart. This reminds your customers to come back to your store and complete their purchase. On average, each abandoned cart email generates $5.64. In comparison, the average promotional email generates $0.02.

3. Use segmentation

Customer segmentation is the process of dividing customers into groups, allowing retailers to do more targeted and effective marketing.

Segmentation is a powerful antidote to poor database engagement and low email open rates. According to research by Hubspot, 78% of marketers reported that segmenting their database is their most effective email marketing strategy. In an analysis of more than 100,000 emails, Hubspot found that segmented email lists had 12% higher click-through rates than emails sent to an entire database.

You can segment your database in any number of ways, allowing you to discover and create different cross-sections and niche subgroups within your database:

  • Demographics: Segment by common customer characteristics such as age, gender, or life stage.
  • Geography: Segment customers based on country, state, or city.
  • Behavior: Segment customers based on their activity at your stores such as last purchase data, repeat purchase rate, or the number of loyalty points earned.
  • RFM: Segment by Marsello’s RFM groups based on purchase recency, frequency, and spend. (most valuable customers, at-risk customers, window shoppers, and more).
  • Or any combination of the above.

 

Merrell NZ: Creating segments of your best customers

Merrell NZ’s average repeat purchase rate across the database is 15%, but some groups of their customers purchase more frequently than others. Merrell NZ uses loyalty program tiers to create segments of their most engaged customers for VIP marketing.

Above: Segment your marketing lists with Cin7 + Marsello.

Sending targeted marketing to your best customers, like this, is smart. Roughly 80% of a business’s profits will come from 20% of its customers—that is, your regulars. These customers are brand-aware, highly likely to engage with your emails, and are very unlikely to unsubscribe.

Retailers can also send more frequent messages to those who are loyal brand followers (although you’ll see your best engagement if you don’t send more than five emails per week).

Some customer database tips

  1. Email marketing is all about quality, not quantity. Sending targeted, considered emails to smaller groups will often outperform bulk emails to your entire database.
  2. Database hygiene will help engagement and reduce costs. From time to time, remove contacts from your lists if they haven’t responded to win-back campaigns, or haven’t opened emails in a long time.
  3. Get more granular, detailed customer data for better segmentation. Connect your online and in-store sales channels to your marketing platform for the best results.

Cin7 + Marsello

Powered by Cin7 and your e-commerce data, Marsello works seamlessly in-store and online to provide a true omnichannel customer experience.

  • Capture in-store and online customer details
  • Deliver personalized and timely automated marketing
  • Incentivize repeat purchases with email, SMS, a loyalty program, and more
  • Grow your average basket size with advanced product recommendations
  • Accurately track and attribute sales to your marketing activity

Book a demo with Marsello

Inventory management best practices to increase sales

Some economists are predicting a mild recession in 2022 in the United States as consumer spending slows in response to inflation. As a product-based business owner, you need strategies to help you weather any recession. By leveraging technology to manage your inventory, you can survive any challenging situation.

Cin7’s inventory management software is your best bet to automate your business processes and have optimal inventory control.

Right-sized inventory, better cash flow

The less time inventory spends on the shelf or in the warehouse, the more cash you’ll have in the long run. That’s because it costs money to warehouse and manage stock. Consider the cost of employees, utilities, storage and shelf space, along with the depreciation of products that are waiting to move.

 

Inventory management best practices to increase sales

Cin7’s inventory management software, combined with best inventory management practices, will help you boost sales and maximize profits. Start by following these steps.

1. Assess slow-moving stocks

Cin7’s robust inventory management software will help you assess your slow-moving stocks with

  • a simplified stocktaking process,
  • precise reports, analytics, and data on past sales,
  • a platform connecting your stock locations, warehouses, sales channels, orders, reports, etc., and
  • streamlined business processes.

In short, the software makes your business more transparent. Thus, you always know what goes in and what comes out. You can always access purchasing reports and sales analytics and make data-driven buying decisions to stock inventory. That way, you can minimize deadstock and maximize your sales.

2. Run a promotion

After you have identified your slow-moving stock, it is important to find ways to increase turnover. The answer is promotions and sales. Who doesn’t like to buy at a reduced price?

Some strategies for increasing sales include:

  • Bundle products: You can bundle relevant products and offer them at a discounted price — like a pancake mix, maple syrup, and a special pancake flipping spatula.
  • Advertisements: Advertise on your website, social media, and apps. An ad saying 30% off or a two week stock clearance can grab the customer’s attention and move your products off the shelf.
  • Offer products at a discount with top sellers: You can pair up your slow-moving stocks with the top sellers at a reduced price.

3. Forecast accurately

The fool-proof strategy for a successful business is putting your data to work for you. Cin7’s software provides sales reports and analytics so you can make predictions about what your inventory will look like in the coming months. Thus, you can stock fast-moving products and prevent deadstock.

Here are a few tips for forecasting the market trends:

  • Go by data and not instincts. Constantly assess real-time insights and data before making business decisions.
  • Define your goals. It can be anything from improved sales, increased profits, website traffic, and customer retention to customer acquisition. With clear-cut goals, you can better analyze and foresee the market.
  • Do competitor analysis. Analyze their products, online presence, and marketing gimmicks and identify your areas for improvement.
  • Conduct forecast meetings regularly and try to stay abreast with market trends.

4. Source efficiently

Sourcing is a crucial part of any procurement process. It involves screening, analyzing, and finalizing suppliers to buy goods for your organization. Efficient sourcing means identifying and partnering with quality and cost-effective suppliers while maintaining optimum inventory levels with minimum overhead costs.

To source goods efficiently:

  • Conduct product research: As a business owner, you must clearly understand your product and how they are produced. Thus, you can identify and procure quality components.
  • Find the right suppliers: A supplier provides goods for your business regularly. Do your research and find reputed suppliers who provide prompt deliveries. You can ask for samples and even trial-run an order before partnering with them long term.
  • Make a contract: Once you and your supplier agree to the terms, make sure you seal the deal by signing a contract. A written contract is a legal document which covers the quality of goods, the length of the agreement, payment terms, and actions in case of negligence or breach.
  • Outsource: If sourcing goods sounds overwhelming, you can outsource to a third party who will choose quality goods for your business.

 

Perils of poor inventory management

No matter what or how you sell, bad inventory management can hurt your cash flow and negatively impact your bottom line. Poor inventory management can have significant consequences including:

  1. Higher holding costs. The longer you hold inventory, the higher your costs. Thus, without good inventory management and information, you may stock up on too much of a product, erode cash flow, and risk holding dead stock that has become obsolete.
  2. Missed sales. While holding too much stock carries risk, having too little stock means losing sales. If you rely on static inventory tracking, you won’t have data on hand to know a product is selling better than expected. Real-time data and reports help companies see when it’s time to replenish or increase stock levels of hot-selling items.
  3. Uncertain cash flow. Without good inventory management, you may be far from optimum inventory levels, tying up cash in the short term, making it more difficult to meet other expenses and short-term debt obligations.
  4. Too much real estate. With too much inventory, you’ll need more space to house it. Carrying the right amount of inventory reduces the need to own or lease excess space. Good inventory management means optimizing retail space and economizing warehouse space.

 

Wrapping up

Good inventory management is a key to weathering uncertain economic conditions.

With Cin7 inventory management software, you can implement best inventory management practices to thrive even when times are tough. Book a demo with us if you want to know how Cin7 can benefit your business.