The Retail Industry’s Guide to Using Automation to Improve Purchasing and Inventory Management
As someone working in the retail industry, you know the constantly changing nature of retail presents a wide range of challenges to keeping your business processes running smoothly. One of the biggest challenges to face retailers is keeping track of orders and inventory, and that’s one area where process automation can play a key role.
According to a research initiative by McKinsey Global Institute, as of 2019 “about half of the activities in retail can be automated using current, at-scale technology.” While this number might initially seem to indicate high numbers of job loss looming in the near future, in reality, automation of this sort is “more about the evolution of jobs, the creation of new ones, and reskilling” (“Automation in retail: An executive overview for getting ready”).
If you’re wondering if automation could make you or your people irrelevant, that’s not something you need to worry about. In fact, the McKinsey report says that retail can only fully automate 5% of current jobs and that the process of automating will create new jobs. Process automation makes your job easier. It also frees-up employees to focus on tasks other than something like routine paperwork.
Today’s article is part of NextProcess’s Automate Your Industry blog series. In this article, we’re focusing on specific ways that companies in the retail industry can benefit from using NextProcess’s purchasing software module to improve procurement and inventory management.
Purchasing Made Simple
Problems like accidental orders, duplicate purchases, and going over budget are common in purchasing departments. That’s true for all industries, of course, but it can be particularly challenging for retail if you’re relying on the purchasing department to coordinate with wholesalers and stock the goods that you plan to sell. And if your company has multiple retail locations, particularly if you have both an online and brick-and-mortar presence, purchasing can get even more complicated.
Automation helps you simplify things. You can coordinate all the purchasing for your entire company using one e-procurement system that automatically enforces your company policies and catches costly mistakes before they become an issue. Purchasing all happens within the system through punch-out catalogs that make procurement easy for your employees and simplify oversight and control for the purchasing department.
Automation and Inventory Management
While a purchasing system doesn’t have the power to improve inventory management on its own, automated procurement software can play a key role in making your inventory easier to manage. Generating purchase orders is the first step to implementing 3-way matching.
With 3-way matching, the purchase order your company submitted, the invoice from your supplier, and an inventory of the goods your company received all have to match before accounts payable submits payment for an invoice. The process of 3-way matching ensures that you’re receiving everything that you ordered and that you’re not paying for damaged or missing goods. And because receiving generates a Goods Received document to match against the PO and invoice, you also have information that helps you track incoming inventory.
Seamless Software Integration
While NextProcess does not offer a software module to automatically use Goods Received documents for inventory management, our software integrates seamlessly with most other systems. We’ll be happy to work with your company on an individualized level to make sure our purchasing software supports the other systems you use for inventory management and managing orders.
We also designed NextProcess’s modules to integrate with each other. For example, if you implement our purchasing software alongside our accounts payable module, purchasing and AP can communicate and coordinate much more easily. The two systems are connected, and if someone in purchasing wants to check a PO against an invoice, they can open that information up with just a few clicks. There’s no need to switch programs on the computer—it all blends together for a simplified, stress-free user experience.
Standardize Across Locations
One of the challenges that retail must contend with is coordinating multiple locations. Modern retail often involves a combination of brick-and-mortar stores, warehouses for storage and shipping, and online e-commerce websites that all must work together.
The value of having a simple, centralized process for managing and coordinating purchasing across your company really can’t be overstated. With an automated system like we offer here at NextProcess, everyone involved in purchasing across your entire company has access to the same system, which updates in real-time.
Anyone with the right permissions can log-in to the purchasing system from any location with internet access. You set custom permissions for different users, deciding who can order and from what suppliers. The system automatically enforces your custom policies and gives managers the insight needed to coordinate purchasing.
Easy Employee Training
Retail is often characterized by a variable workforce, spread out across multiple locations and working with people of many different cultural backgrounds. One of the big advantages of using NextProcess software is that the system is very easy for new users to learn.
We’ve made our software interfaces as user-friendly as possible. Even people who have no experience using purchasing software can quickly pick-up the way our Purchase Order Module functions. We also don’t charge extra for additional user licenses, so you can make this software available to every employee who has purchasing permissions. You’re also able to customize how each user sees the software. That means an employee who’s allowed to make purchases but doesn’t have administrative access only sees the parts of the software that they can interact with and use, making for a simplified interface.
Why Choose NextProcess
Here at NextProcess, our core values involve creating software that is user-friendly, affordable, and automated. We put a high value on delivering software that makes your work as a retail company easier. We also strive to create an open relationship that allows for easy and clear communication, and we welcome your feedback on how we could better serve your company and your industry.
Our software is highly configurable and flexible. Instead of making you adjust your process to our software, we do everything we can to fit our software to your company’s needs and policies. We’re highly involved in the implementation process and (unlike many of our competitors) we have a successful implementation rate near 100%.
If you’re ready to see how much purchasing automation can help your retail company, contact us and schedule a free demo. We’ll answer any questions you have and give you a first-hand look at how our software can improve the way your company handles purchasing.