Retailers struggle with inventory blind spots

Photo by Tiger Lily

While the concept of seamless integration between online and offline shopping experiences is widely acknowledged among retailers in Australia and New Zealand (ANZ), a study by Manhattan Associates identifies a significant gap between the ambition for seamless integration between online and offline shopping experiences and actual practice.

Retailers admitted that on average they only had an accurate indication of inventory across their entire operations 68% of the time – with just 4% reporting 100% accuracy.

“In 2024’s challenging economic landscape, where consumers are more hesitant to part with their money, the necessity for a frictionless shopping experience has never been more pronounced. ANZ retailers are at a crossroads, with a clear directive to enhance their omnichannel strategies,” said Raghav Sibal, Managing Director, ANZ, at Manhattan Associates.

“Our research shows that if an item is out of stock, 36% of customers prefer having the option to find it at a nearby store or consider a similar product. Retailers who streamline this process, making every touchpoint and transaction as efficient and engaging as possible, can turn browsers into buyers.”

Consumer expectations reflect a clear preference for immediate solutions when products are unavailable in-store, signalling a strong demand for technologies that improve stock visibility and availability across channels. Manhattan Associates’ research also highlighted the partial integration between online purchases and in-store returns, with less than half of retailers (47%) offering this service.

Greater adoption of RFID tags in retail stores is one way to improve inventory accuracy, helping retailers to simultaneously achieve operational efficiencies and enhance the customer experience. Currently, 43% of retailers said they have adopted RFID technology into their operations, however only 34% are utilising RFID for ensuring accurate, real-time stock levels – highlighting that a significant majority of retailers are yet to advance their operational efficiency.

The significance of knowledgeable shop assistants is also highlighted, with 63% of consumers placing a premium on product expertise. Without an accurate view of stock or inventory, sales assistants are at a disadvantage, impairing their ability to fulfill their roles effectively.

“Equipping staff with the necessary tools and information is just as crucial as investing in technology to ensure they can deliver informed and engaging customer experiences,” commented Sibal.

While retailers in ANZ understand the necessity of omnichannel strategies, the challenge lies not in the desire to adopt them, but in the complexity of implementation. In today’s market, to simply offer integration is no longer sufficient.

“Retailers today need to rethink traditionally held ideas around assets and operations. This change is all about making shopping as easy and enjoyable in person as it is online. Walking into a store with prior online research is now the norm, making online and offline shopping a single, continuous experience,” said Sibal.

“Customers are looking for value, quality, and service. They demand consistency and the freedom to shop on their own terms, expecting a flawless experience no matter the method, time, or place of purchase.

“It’s essential for retailers to streamline their operations and technology to cater to the modern shopper, who doesn’t think in terms of channels. They require technology with the infrastructure, agility, flexibility, and scalability to join all the digital dots together if they are to maximise the potential of their stores and deliver a truly seamless and memorable customer experience,” he concluded.