Aug 22, 2023
In the latest episode of the Martalks Podcast, host Darrell Rosenstein is joined by Gurhan Kok, Founder and CEO of invent.ai to discuss how composable analytics allow retailers to use different tools and technologies to create an optimal solution for their inventory on hand. A composable analytics tool such as invent.ai integrates several analytical compounds like inventory management software, AI models, data pipelines, visualizations and dashboards in one unified platform. All these components can be reused, assembled and customized to fit the needs of the business. Inventory optimization is the lifeblood of any retail industry and composable analytics boosts the game further.
The retail industry is always a work in progress. Composable analytics solutions such as invent.ai provide a data-driven, granular approach to managing inventory levels while reducing waste and increasing sell-through. Composable analytics can improve inventory optimization in five main ways:
Demand Forecasting: Demand forecasting is a process that predicts future demand for products and services. It helps maintain optimized inventory levels by reducing excess inventory for slow-moving products and having safety stock for fast-moving goods.
Automate restocking: Composable AI is an effective inventory optimization solution that can use real-time data for inventory planning. It tracks seasonal trends and sales patterns across distribution centers and retail stores, thus enabling proactive restocking.
Cross-channel integration: Composable AI creates visibility across online, warehouse, and retail locations of available inventory. It provides real-time data across the channel, thus making supply chain management a breeze. Even manufacturers can use this information and arrange for raw materials accordingly. It reduces lead times and mitigates carrying or holding costs caused by excess inventory.
Simulation: Futuristic scenarios are simulated for risk management and to improve efficiency. Composable analytics creates different market scenarios by adjusting machine learning algorithms and observing the results. This helps businesses create better inventory planning strategies, and improve their service levels while strengthening the bottom line.
Data-driven decision-making: The top priority of a retail business is meeting customer demands. Customer demand can be unpredictable and change based on many factors, such as seasons, socio-political situations and fashion trends. Valuable data collected from analytical tools can influence inventory optimization techniques and help improve customer service. Additionally, the reorder point (ROP), the inventory level at which a new order should be placed, can be predicted accurately. all the developments in AI-based demand forecasting, many fashion retailers still use a gut-based approach and trust their buyers, merchandisers and designers to make pre-season forecasts.
Along with insightful background on how he ended up in the world of retail inventory analytics, Gurhan also touches on some of his commercial strategies, including:
Focusing on quick ROI: Start small to grow big. Gurhan suggests focusing on niche products and locations for beginners and scaling up as the balance sheet becomes healthier. The inventory turnover ratio is crucial to the success of a retail unit. Inventory costs can be managed efficiently by balancing stock levels so that there is a steady flow of the product in demand. Invent.ai's willingness to work with imperfect data: Retailing involves dealing with several types of inventory. The solution uses AI and machine learning to compensate for the lack of data so that retailers can still achieve accurate demand forecasts and have optimal inventory levels, including ready-for-sale and phantom inventory. Invent.ai provides retailers with a comprehensive solution that addresses all these factors.
Compatibility with existing systems: An inventory optimization software such as invent.ai can integrate with legacy inventory management systems so retailers can achieve a quick implementation and can start seeing quick results. It can toggle the cost of goods sold (COGS) in real time, thus giving clients more accurate, profit-level insight.
Glean valuable information and mindset from this podcast.
Talk to a retail AI expert to learn more about how to boost profit dollars with invent.ai inventory management.