According to a 2023 Deloitte report, the retail industry has experienced significant challenges this year. These challenges in retail management mainly stem from market volatility, supply chain constraints, and workforce issues.
The report identified three key areas that retail businesses should address to tackle these challenges: last-mile capabilities, social commerce, and reverse logistics. The report also makes the following recommendations:
- Companies must invest in automated micro-fulfillment centers (MFCs) to free up employees and hasten order fulfillment and deliveries.
- Give importance to reverse logistics by improving the returns experience. To do this, Deloitte suggests companies use return bars, which are stores that collect, pack, and ship returns to retailers. Return bars help retail businesses save close to 20% in processing costs.
- Each new customer acquisition costs six to seven times more than retaining an existing customer. Hence, retail businesses should invest in social commerce to provide a seamless shopping experience on social channels.
With these facts and figures in mind, let's look at how cloud solutions can fill the gap and help retail businesses manage their operations efficiently.
How Is ERP Used In The Retail Industry?
ERP software is an integral tool for businesses across various industries. It streamlines multiple processes, improves data integration, and automates various aspects of a business.
From finance, inventory management, and human resources to sales and marketing, an ERP helps centralize all operations onto one platform and stores all data in a central repository. This helps avoid data duplication and human errors and gives access to rich insights derived from real-time and historical data.
Retail businesses have a plethora of processes that can be automated, like inventory management, warehouse operations, shipping and deliveries, and customer service. ERP helps retailers gain real-time visibility into various business processes, allowing them to identify market trends and implement demand planning and forecasting quickly.
By using a retail ERP solution, retail businesses can turbocharge their operations, free up staff time, implement omnichannel operations, and devote more resources to cultivating strong customer relationships.
The primary hurdles in the retail sector, such as workforce issues, final delivery capabilities, and market instability, can be effectively addressed with ERP. It allows retail businesses to do what they need to do the best — deliver high-quality products to customers quickly and ensure top-notch after-sales support.
How Cloud Erp Benefits Retail Business Management
ERP solutions can be delivered via the cloud or installed on-premise. Most retail businesses prefer cloud ERP due to universal cross-device accessibility, data syncing, and the capability to assign access levels to different employee groups, teams, and external vendors.
Cloud ERP, managed and updated by the ERP provider, frees retailers from handling underlying logistical processes. Instead, they can concentrate on streamlining their retail operations and enhancing the customer experience.
The key benefits of cloud ERP for retail business management include the following:
Enhanced business efficiency
Today, all retailers face challenges in managing logistics, which can hinder business efficiency.
Recent studies show that streamlining supply chain operations is crucial to ensure timely delivery due to disruptions to the global supply chain.
Cloud ERP empowers retail businesses to handle purchase orders efficiently, monitor the performance of external vendors and suppliers, manage warehouse operations, and access insights that lead to informed business decisions.
Accurate demand planning and forecasting can mitigate market volatility and prevent overstocking or understocking.
Access to real-time data and insights
Several new technologies, such as the Internet of Things (IoT) and embedded devices, allow ERP solutions to gather real-time data. These technologies facilitate delivery tracking, inventory insight acquisition, and product usage and performance monitoring.
IoT-enabled ERP allows you to track your stock, wherever it is, even in transit and quickly identifies when inventory needs replenishing and restocking. At the same time, real-time product performance data helps you deliver superior maintenance services to customers.
Modern Cloud-based ERP solutions also incorporate AI features, helping you make precise predictions and forecasts by comparing real-time and historical data.
Enhanced staff efficiency
According to a survey from Kronos, nine out of ten employees waste time on activities unrelated to their core job. More than 41% of full-time employees waste more than an hour daily on tasks they shouldn't perform.
Many of these tasks can be handled by an ERP system, from manual entries and shipment tracking to recording warehouse operations and other processes crucial to retail businesses.
It liberates your employees to focus on their primary tasks, improving delivery capabilities and customer service.
Improved customer experience
When it comes to cloud ERP, nothing is more important than offering your customers a centralized shopping experience through an omnichannel CRM. A cloud ERP ensures customers can shop seamlessly on any device or location. You can easily provide the same shopping experience on your social media channels, brick-and-mortar retail locations, and e-commerce websites.
Cloud ERP helps make your social media accounts more engaging, contributing to customer experience. Social commerce is about more than just sales. It is also about creating content that engages your customers and provides them with a satisfactory experience.
Cloud ERP helps you do just that by personalizing social campaigns and conversations.
The Future Of Cloud Erp In Retail
The future of retail will rely on increasingly adaptable and scalable cloud ERP solutions to address the various challenges related to an unstable market and changing customer expectations. Thus, there will be a greater focus on data analytics, improved logistics, and social commerce.
Enhanced data analytics
The retail industry increasingly relies on data gathered from different sources. In the future, we expect cloud retail ERP solutions to integrate even more IoT and AI capabilities to extract valuable insights and make accurate predictions. These tools will help retailers in making data-driven, consumer-focused decisions.
Cybersecurity and data protection
As cloud ERP processes and stores various data types, compliance with data security regulations is paramount. We anticipate that ERP providers will devote more time to enhancing the security and safety of existing ERP solutions to encourage more retailers to transition from on-premise solutions to cloud-based ones.
Integration with new technologies
In addition to IOT and AI, embedded technologies and machine learning will play a critical role in future ERP versions. We expect more cloud ERP providers to offer industry-specific, "low-code" solutions. For example, cloud retail ERP solutions will focus more on integrating technologies that help personalize shopping experiences and invest more in large language models (LLMs) that accurately detect consumer sentiments and behaviors on social media.
Choosing The Right Erp Product For Retail Business Success
The market is flooded with ERP products, making choosing the one that fits your business needs challenging.
Start by defining your goals and objectives for using an ERP and then shortlist vendors whose products target your business.
Next, contact these vendors to ensure that they offer consumer-focused cloud ERP solutions that can adapt to changes in technology and market trends.
Priority's retail management suite is Cloud-ERP based. It helps implement an omnichannel shopping experience and facilitates integrating cutting-edge technologies such as IoT, AI, and machine learning to derive rich insights.
Contact us today to learn how Priority's ERP retail management software can help your business.
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