Retail Allocation Software

What is Retail Allocation Software?

Retailers’ most valuable assets are their products; but, in order for the assets to release their value, they have to be in a store at the time a customer wants to buy them - and for this reason many leading retailers are using retail allocation software.

Making sure that the right products are in the right place at the right time results in improved sales and customer satisfaction levels, less stocks-out and lost sales, and fewer profit-cutting promotions and markdowns to reduce surplus inventory.

However, making sure that your products are where they need to be in order to meet customer demand can be major problem for many retailers. Fortunately a practical solution is available in the form of retail allocation software.

The Challenges of Retail Allocation

retail allocation software

In past retail practices, products were usually dispatched to stores in substantial quantities at the beginning of each season; with the hope that they would sell before the start of the following season to allow for new products to be introduced.

However, in the current retail environment, the challenges of product allocation are becoming more complex due multiple selling channels, the online data that potential customers have at their fingertips, and the influence of social media and inbound marketing.

With retail allocation solutions, retailers are able to allocate their products more accurately based on stock levels and forecasted demand, react to store-selling performance and consumer-buying trends, and replenish inventory according to actual demand once their products start to sell.

Retail Allocation According to Demand

One of the worst possible scenarios in the retail industry is that a customer walks into a store to buy a specific product and finds it out of stock. The customer’s disappointment at the product not being available may be far less than that felt by the retailer - who has not only lost a sale, but potentially a customer as well.

Retail allocation solutions reduce the likelihood of this scenario occurring by factoring customer demand into their allocation calculations. With retail allocation software, accurate allocations are produced taking into account forecasts, real-time POS data and replenishment orders in progress to ensure an appropriate supply of product is distributed between stores and distribution centers.

Robust retail allocation solutions are essential for retailers to determine the best mix of product to dispatch to stores, as well as indicating when it would be best to adopt a “hold-back” strategy. Using this strategy, when real-time sales data is available, retailers will know what products are selling where, and can distribute “held back” inventory from distribution centers to stores in appropriate quantities.

Retail Allocation Solutions and Replenishing Inventory

Not only are retail allocation solutions essential in the accurate distribution of products to stores; accurate replenishing also has a role to play in the successful execution of retailers’ financial strategies.

Retail allocation solutions initially attend to inventory placement at the beginning of a season, and are used to get products to the appropriate locations in time for their launch. After that, retailers will need to replenish inventory as it is sold and “pull” further inventory from distribution centers based on actual sales data.

Once sales data relating to a product or category is determined, replenishing ensures that the products are available in stores to meet continuing demand. Best-in-class retail allocation software will deliver results that lead to improved inventory turns and assured in-store availability - eliminating scenarios involving disappointed customers and more disappointed retailers.

JustEnough’s Retail Allocation Software

JustEnough’s Retail Allocation software takes the speculation out of allocating inventory to stores where it has the best chance of being sold. JustEnough’s solution forecasts future customer demand based on historic values, takes current stock levels into account and what has already been sold. The program then calculates the optimal number of products to send to each store and how much should be reordered across the supply chain.

All elements of the process are easy to manage, with an Allocation Rules Management Tool allowing retailers to define unique requirements of the business - such as sales data, promotions, full price or markdown sales, or any combination of factors that might influence where inventory should be sent.

A subsequent Allocation Review produced by the Retail Allocation software allows planners to amend the pre-determined parameters to account for any knowledge they may have of seasonal or geographical variations, and to account for marketing activities or fashions. This particular feature of JustEnough’s Retail Allocation solution has been found to reduce spend, increase turnover and enhance the productivity of the planner.

Benefits of JustEnough’s Product Allocation Software

  • Less likelihood of stock-out scenarios
  • Enhanced customer experience
  • Increased inventory turnover
  • Reduced overstocking of product
  • Less markdowns and loss of profit
  • Improved planner productivity

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