In an industry where profit margins are low, majority of retailers having less than 4% profit margins, the key of survival for each company is to innovate and modernize its business. The latest economic challenges generated by the COVID-19 pandemic accentuated the need to have more stable and efficient IT solutions, this becoming critical for companies to survive these times and generate enough momentum to push them forward in the near future.
To maintain a good margin, a retailer faces a lot of challenges, as keeping up with changing customer expectations, maintaining the loyalty of the existing customers and retain new ones, communicate with the supplier networks, having a real-time inventory visibility, quickly respond to the market changes, overtake the competitors and innovate, facilitate internal communications, having almost or real-time insights about the key metrics of the company and the list is not ending up here.
To address all these challenges, automation is the key, and this is done by using the proper retail software. Each business should consider using the best retail software solutions in order to become more competitive, stronger and intelligent. The retail technology is varied and the organizations can choose their best enterprise software solutions to boost their business.
While other activities may have as objective the proper functioning of only certain departments, the sales activity should concern the entire organization. An efficient sales process involves the coordination of all departments to obtain the desired response and a higher reaction speed. These are aspects that contribute to achieving a common goal: higher revenues.
Automation is about how you leverage the data. Especially in this industry, there is a constant need of using, creating, distributing and analyzing the data in a timely manner, for a quick decision making and value creating process. This can be done only by the automated systems used to capture the data across different channels and touchpoints.
Why BI and Data is playing such an important part? Well, because the retail industry is a complex one, where the businesses must focus on several areas, all of them requiring in-depth analysis of important variables ( stock availability, costs, sales rates etc. ).
Most of the retailers adopt various business intelligence tools in order to become smarter, improve the process of decision-making along with their financial and operational performance. I will present below some of the BI tools that are often used in the retail industry:
OLAP Cubes provides retailers with multidimensional cleansed and transformed data gathered from various sources, then prepared for on-demand analysis, anytime and anywhere is needed.
They are enabling companies to view the data from multiple points of view and contribute to a smarter process of planning, with lower costs. Therefore, business owners can solve complex business issues in a smart way.
Reporting/ Self-Service BI
BI reporting is providing observations and suggestions about business trends, empowering decision-makers to act accordingly. Unlike the old school reporting, where the reports were static and they were providing information about the stock or sales situation, BI reporting provides not only basic information, but is showing relations between different factors, why some things are happening and ways to improve the current performance.
Users are allowed to generate their own reports, with all the metrics that they need. All the insights are data-driven and they are based on past data. These dashboards are the perfect tools that can help business users to gather all the organizational data in one place and help them in the decision making process.
For more details, check our post: https://www.mindit.io/blog-posts/analytical-databases-and-self-service-bi
Predictive analytics for future strategy
Predictive analytics tools are used for examining the past data to project and forecast future situations or risks that may appear. This is used by most retailers to obtain future insights in order to make the decision-making process more data-driven and reliable. Forecasting inventory requirements, cost fluctuations, demand, the retailer scan improve their action plan for the future.
This is a process used to discover patterns in big data sets, involving methods like statistics, machine learning and database systems. Data Mining tools are acquiring new and undiscovered information from the available data sets.
Regression, classification, clustering or sequential patterns used to recognize hidden relationships between data are mainly used in the process. With these tools, retailers can identify existing patterns in terms of customer behavior and satisfaction, marketing campaigns efficiency and many other performance indicators.
In our days, there is a constant competition between the retailers to become smarter, to do their business in an efficient way, with the scope of acquiring competitive advantage and improve the sales rates. To grow and support the steady development in the long term, every retailer should consider using smart solutions. Automation is strongly related with the data that every retailer owns, so BI is playing an important role in this process.
Working with the right tools empowers the entire organization to become more efficient, stronger and more intelligent. It doesn’t matter what your business is specialized in, if you are selling electronics or clothes or only services, embracing smart solutions will reward you with a brighter tomorrow.