Posted on | May 5, 2014
Written by | Ian Griffith
By now, “early adopters” and the “early majority” have embraced the internet in some form, and we are witnessing the gradual conversion of the “late majority” and “laggards” to the benefits on online marketing. Online sales don’t require an eCommerce website, but they do require good data from a POS system.
Stores that sell online have had to address the challenges of maintaining a reasonably accurate inventory, including current vintages and validated UPC codes. Consumers expect when they order something online that it is available under most circumstances, and if they have bad experiences they will likely shop somewhere else.
The recent explosion of mobile apps that sell wines and spirits has placed an additional premium on accurate POS information. Some apps are happy to replicate the website experience with shipping across the country of anything that can be sourced by the store. However there is a wave of local delivery apps, led by Drizly, that connect the buyer with a local store and promote delivery in 20-40 minutes. In this scenario, a nightly update of products for sale is no longer sufficient to minimize customer frustration. Product availability needs to be updated in much tighter increments. Which means a store needs to commit inventory in the POS once an order is received so that items are removed immediately.
Getting Closer to Real Time
Even though Drizly asks stores to focus on a few hundred mainstream brands, they have been surprised by how often their retailer partners will sell out of high volume items—so much so that they’ve begun recommending inventory management solutions to stores. These services help create forecasting models that predict demand, and they balance inventory costs against lost sales. To support these forecasting models the store needs to share accurate stock counts along with daily sales history on their products—all information that should be in the POS.
Another technology that is starting to make an appearance at retail is price management software. A prominent vendor in this space is Vistaar who build simulations that model price elasticity to predict volume and margin gains from different pricing scenarios. Often retailers become aware of price management solutions through supplier and distributor partners who are trying to optimize sales along the supply chain. A simulation might focus on a portfolio of products from a supplier and test how changes in price affect sales volume and profit. Again, to measure the effectiveness of pricing decisions it is important to feed accurate information back to the vendor.
Technology solutions are becoming mainstream in our industry to the extent that it is time for every store to look at their POS data as a strategic asset. This data will pay dividends from helping optimizing the store operations as well as with marketing products online.
To comment or to learn more about how Beverage Media can help with a website for your store visit BevSites.com, or contact James Laurenti at 617-864- 1677. Follow us on twitter at twitter.com/bevsites.
To comment on this column or to learn more about how Beverage Media can help with
a website for your store, visit BevSites.com or contact Ian Griffith at 617-864-1677.
Follow us on Twitter at twitter.com/bevsites
For a complete listing of all the Talkin' Tech articles, please visit Talkin' Tech on BevSites.com.