For large eCommerce retailers with brick-and-mortar locations, inventory management can be a challenge when a variety of locations need to communicate with one another to keep inventory data current. Inventory management should be updated in real-time, if possible, so your customers aren’t left wondering when their favorite items will arrive back in stock. This requires your eCommerce platform to have the functionality built in to allow inventory management systems to talk to each other seamlessly, without slowing you down. Depending on your eCommerce platform provider, this might be a simple fix, but for some it could involve complex custom integrations that will likely require significant resource expenditure from you and your team.
You’re probably not surprised to learn that the power of AI could help you tackle complex inventory system integrations without that extra effort from your team. There are tons of tools out there to help you manage inventory using AI, and tons of reasons why you should consider doing so.
The Benefits of AI-Powered Inventory Management
Customer Experience
Real-time inventory updates improve the customer experience. The last thing you would want is to realize that your inventory data didn’t update fast enough, and a customer has purchased an item online that isn’t available anymore. Not only will this result in more work for your team, but customers will feel frustrated and disappointed as well because of the bad experience. This is why it’s so important for building loyalty and trust with your customer base to make sure inventory data is accurate and updated as frequently as possible. With AI-powered inventory tools, this could be a totally automated task, so you won’t have to worry about it at all.
Demand Forecasting
AI uses predictive models to analyze historical data in seconds. This information combined with real-time inventory data can help AI models to draw conclusions about customer behavior and help you to predict which items to stock and when, so you can guarantee the items your customers are looking for are always available. This will make marketing more efficient, improve the customer experience, and it will require much less effort from your team to forecast product demand.
Scalability
Even if you don’t have complex needs right now, your needs are going to change as your business grows. The great thing about automated tools is that they are created with scalability in mind, so your tech stack can grow with you. These tools are a great option for businesses who want to stay agile and ready to adapt to the ever-changing eCommerce industry as they allow you to waste fewer resources and continue to expand your team.
Cost Efficiency
Depending on which tool you choose, it can be a wise investment to take some of the load off of your team, even if it might cost more upfront. Adopting automated tools that consume less resources will allow you to expand your team so you can focus on the things that matter the most while the repetitive and monotonous tasks are handled behind the scenes.
Challenges of Using AI for Inventory Management
Upfront Cost
As mentioned above, the unfortunate reality of advanced integrations usually involves a pretty steep price tag initially. For smaller retailers, this can be a difficult hurdle, but it could still benefit any retailers who are looking to see growth long-term.
Learning Curve
If you have a small team, you may not have enough collective experience to even know where to start with a major project like integrating an AI inventory management system. You may have to outsource an agency or hire more staff. Either way, it will not only cost you money but present a difficult challenge for your team.
Data Availability
One major drawback of AI-powered software is that it can only work well with tons of highly accurate and up-to-date data. If you already struggle with systems that aren’t designed to communicate with one another, it’s highly likely that you don’t have the data you need to properly train an AI model to manage your inventory successfully. This doesn’t mean you can’t use AI to help you automate tasks; it just might take more time away from your team to gather the information necessary to get started.
Security
Because AI tools require a significant amount of data, including data from your customers, there are concerns that AI could pose a threat to data security. With a skilled and highly experienced team who are aware of how to train AI models in a way that protects sensitive data, this shouldn’t be a major concern.
How to Get Started
If AI inventory management isn’t something you already have built into your eCommerce platform, you may have to do some research and enlist the help of your developers to help you get started. There are many different AI inventory management tools available on the market that will take care of the heavy lifting for you, but they do come at a price, and it can even be tricky to integrate third party tech into your site if your platform simply doesn’t allow you to do so.
Many software as a service (SaaS) eCommerce platforms require you to use their own proprietary software when it comes to complex integrations like AI inventory management, email marketing, alternate payment methods, etc. This often means that you must pay extra per month for every additional integration, and you can only use their tools, so you don’t have any control over what you get. With a composable commerce platform, you have total control over every component of your tech stack and can freely swap out elements to create a custom solution that’s right for you.
marketAgility, Virid’s eCommerce platform, is the best of both worlds. With one set monthly payment, you get all the efficiency of a SaaS platform, but you can pick and choose third-party vendors and services that best suit the needs of your business. The best part is that we take care of the complex integrations, so all you have to do is sit back and watch your revenue grow.
Schedule your consultation today to get started.