Smart inventory management is crucial for the success of any retail business, especially in the fast-paced world of fashion. Keep track of stock, manage reorders, and ensuing that popular items are always available are all daunting tasks without the right tools.
Implementing a smart apparel inventory management system can give you a clear forecast, help restock on time, and ultimately help you reach your revenue goal.
What is Apparel Inventory Management?
Apparel inventory management is the process of tracking and managing the flow of clothing products within a retail store or business to ensure that the right products are available at the right time.
Apparel inventory management includes tasks such as monitoring stock levels, reordering merchandise, tracking sales trends, and optimizing inventory processes to prevent stockouts and overstocking. Implementing an effective apparel inventory management system is essential for the success of clothing stores, as it helps streamline operations, improve customer satisfaction, and drive business growth.
What are four main types of inventory management?
The four main types of apparel inventory management systems are:
1. Just-in-Time (JIT) Management: JIT inventory management aims to reduce carrying costs by receiving goods only as they are needed in the production process or for sale. This method helps minimize inventory holding costs and storage space requirements.
2. Materials Requirement Planning (MRP): MRP is a computerized inventory management system that helps businesses ensure they have the right materials available for production. It focuses on managing the production schedules based on demand forecasts and the availability of materials. This is directly related to raw materials management within the Inventory management system.
3. Economic Order Quantity (EOQ): EOQ is a formula-based inventory management system that helps businesses determine the optimal order quantity that minimizes total inventory costs, including ordering costs and holding costs. It aims to balance the costs of ordering and storing inventory.
4. Days Sales of Inventory (DSI): DSI is a measure of how long, on average, a business holds its inventory before it is sold. It helps assess the efficiency of inventory management by indicating how quickly inventory is being sold relative to the amount of inventory on hand. A lower DSI indicates more efficient inventory management.
Each type of inventory management system has its benefits and challenges, and the most suitable method depends on the specific needs and characteristics of the apparel business.
Prediko is an example of a perpetual Inventory Control System.
In a perpetual inventory control system, inventory levels are continuously updated in real-time as goods are bought, sold, or used. Our system relies on your Shopify D2C store admin to track inventory levels accurately. We have also covered a list of the best fashion inventory software in Shopify.
Challenges in Apparel Inventory Management
The fashion industry presents some unique challenges in inventory management. Seasonal trends, varying sizes, and diverse styles add complexity to inventory tracking.
Additionally, the fast fashion model demands quick turnover, which can exacerbate inventory management issues.
Key Features of Prediko's Apparel Inventory Management Shopify App
How does Prediko help in overcoming these challenges and in tracking clothes in inventory?
Prediko provides immediate visibility into stock levels and helps prevent stockouts and overstocking. Implementing a smart clothing inventory management system offers various features designed to address the specific needs of the apparel industry.
Real-Time Inventory Tracking
Real-time tracking is an important feature that allows retailers to monitor stock levels continuously. This ensures that inventory data is always up-to-date, facilitating accurate decision-making and efficient stock management.
We have covered the list of top inventory tracking apps for Shopify brands. We continuously sync with your Shopify store to give you a real-time visibility into your stock levels.
Timely Reordering Updates
Our interactive Buying Table plugs into your current Shopify inventory levels and recommends What To Buy, When To Buy and How Many Units to Buy. This feature helps in maintaining optimal inventory levels, reducing the risk of stockouts and overstocking.
Our native demand forecasting
Prediko's AI based demand forecasting feature has been trained on 25 million+ SKUs across 15+ industries. Here is how our demand forecasting works:
- We analyze Shopify store's historical sales data and look for seasonality and growth trends in that data.
- If you opt for Smart Plan, we ask you for a 12-month sales or growth prediction upon which the plan is ultimately based.
- This growth expectation is based on you and not Prediko. So make sure the growth expectation is always kept up to date.
Other parameters that we take into account when we generate the demand plan for your apparel store:
a) Popularity of certain SKUs
b) Black Friday and other seasonal campaigns
c) Launch effect- How a certain item behaved when it was launched.
d) Cannibalisation- Whether sales of one product impacts the other.
This enables retailers to make informed decisions about inventory purchases, minimizing waste and maximizing sales opportunities. Learn how to accurately forecast for your Shopify D2C brand.
Analytics
Prediko offers advanced analytics into your existing inventory levels with different features. These tools help retailers gain insights into sales patterns, inventory turnover rates, and other critical metrics, allowing for more strategic inventory planning.
Choosing the right apparel inventory management system
Selecting the right inventory management system for your clothing store is a critical decision. Here are some factors to consider when evaluating different options:
Scalability
Choose a system that can grow with your business. As your store expands, your inventory management needs will evolve, and your chosen system should be able to accommodate these changes. Prediko's Buying Table is easily able to take 1000s of SKUs and display them in the form of an interactive table once it has been installed on your Shopify store.
Integration Capabilities
Ensure that the system can integrate seamlessly with your existing software, such as point-of-sale (POS) systems, eCommerce platforms, and accounting software. Integration capabilities streamline operations and enhance data accuracy.
Prediko is a native Shopify app. We have integrations with Etsy (through a third party app), Faire (through a third party app), Bundles.app for tracking your bundles.
User-Friendliness
A user-friendly interface is essential for ensuring that your team can quickly adapt to the new system. One of the reasons why brands love is because we offer the most user-friendly UI in the Shopify ecosystem.
Cost
Consider the total cost of ownership, including initial setup fees, subscription costs, and any additional expenses for training or support. It's important to select a system that offers a good balance between cost and functionality.
Our pricing starts from $119/month. No locked-in annual contracts. Our pricing is designed to increase with your annual revenue. So if your annual revenue increases, so will our pricing.
Here is how Prediko helps top fashion retailers with their inventory management systems.
Case Study: How Kate Hewko boosted Inventory efficiency by 40%
Kate Hewko, a renowned fashion brand, successfully tackled complex inventory challenges by adopting Prediko's Planning and Purchasing platform. The collaboration brought significant improvements, including streamlined procurement processes, accurate demand forecasting, and enhanced overall efficiency.
Prediko's advanced analytics and reporting tools empowered the brand to optimize stock replenishment, reduce stockouts, and achieve cost savings, leading to improved customer satisfaction.
Case Study: Cloudsharks achieves 35% Fewer Stockouts
Cloudsharks, an eCom brand founded in 2022 by Rayan Mroue, specializes in shark-shaped slides with over 500 SKUs. Facing inventory management challenges, Cloudsharks struggled to meet demand and optimize stock levels.
The main issue was the calculation of stock quantities, which was based solely on current volume and velocity, ignoring expected sales growth.
Additionally, limited support from their previous software, Cogsy, often led to operational inefficiencies. To address these issues, Cloudsharks adopted Prediko's Planning and Purchasing platform, which integrates current sales volume with 12-month sales forecasts.
This switch allowed Cloudsharks to order inventory more accurately, reduce stockouts, and benefit from enhanced customer support, thereby significantly improving their inventory management efficiency.
Implementing an Apparel Inventory Management System
Assess Your Needs
Begin by assessing your current inventory management processes and identifying areas for improvement. Consider the specific challenges your store faces and determine the features that would best address these issues.
Research and Select a System
Conduct thorough research to identify potential inventory management systems that meet your needs. Evaluate each system based on the factors discussed earlier, such as scalability, integration capabilities, user-friendliness, and cost.
If you search for "inventory management" on the Shopify App store, you'll find that we are one of the highest rated apps and we have received a lot of praise for your support,
Plan Implementation
Develop a detailed implementation plan that outlines the steps required to transition to the new system. This plan should include timelines, resource allocation, and any necessary training for your team.
Test and Optimize
Before fully deploying the system, conduct thorough testing to ensure that it functions as expected. Gather feedback from your team and make any necessary adjustments to optimize the system's performance.
Monitor and Maintain
Once the system is in place, continuously monitor its performance and make adjustments as needed. Regularly review analytics and reports to identify areas for further improvement and ensure that your inventory management processes remain efficient.
List of Other Apparel Inventory Management Software for Shopify
Magestore
Magestore is a POS system for clothing stores native to Magento and also integrates with Shopify.
Key features:
- Centralized product data: Manage and apply product catalog across all sales channels from a single backend
- Diverse product management: Generate barcodes and set up product attributes with flexible templates. Barcode scanning provides instant product info, saving manual entry time.
- Bin location: Efficiently manage large warehouses by pinpointing storage locations, preventing misplaced items, and maximizing space.
- Real-time inventory sync: Update inventory data across multiple channels and locations in real-time, avoiding discrepancies.
- Multi-warehouse tracking: Easily manage multiple warehouses, choosing delivery or return locations for credit memos.
- Additional POS features: Omnichannel sales, offline payment processing, click-and-collect, loyalty programs, and employee management.
NetSuite Inventory Management
This software offers warehousing capabilities that allow for full control over your stock distribution process. It provides a unified, real-time view of inventory across various locations and sales channels.
Key features:
- Multi-location fulfillment: Monitor stock levels, sales, and inventory movement between locations to ensure product availability across channels and reduce obsolete inventory.
- Replenishment: NetSuite uses a demand-based replenishment system that analyzes historical and seasonal sales data, along with average lead times, to dynamically determine reorder points and maintain ideal stock levels.
- Cycle counting: NetSuite count is an inventory cycle counting solution that counts inventory without halting transactions.
- Traceability: Track inventory using lot and serial numbers.
Lightspeed Retail
It provides tools for inventory management, store management, payment processing, purchase order management, customer service management, financial system integration, and POS hardware connectivity.
Lightspeed is an eCommerce platform that allows you to manage both in-store and online inventory, get a unified view of customers, and track omnichannel sales performance. Key features include:
- Inventory synchronization across all locations: Ensures accurate item counts in all warehouses and stores.
- Mobile extensions: Allows sales teams to check product availability and complete sales from mobile devices like iPads.
- Product tracking with SKUs: Uses a matrix system to assign serial numbers to products with multiple attributes such as size, color, and material.
- Additional customer service features: Includes profile records, sales history logs, and customer insights.
Fishbowl
Fishbowl provides a comprehensive business management solution tailored for growing clothing companies. The software optimizes and automates processes such as purchasing, production, accounting, inventory management, and sales and customer management.
- Control inventory: Includes barcode printing and scanning, automatic reordering, and managing the picking, packing, and shipping of products.
- Multiple locations: Allows monitoring of inventory levels across various warehouses, analyzing sales trends at each location, and transferring products between locations to prevent stock shortages.
- Order management: Enables tracking of shipments to their destination, receiving stock in your warehouse, recording sales and deliveries, and setting up automatic reorder points for items.
- Sales and purchasing: Instantly updates sales order prices when product information changes, converts quotations into sales orders, saves sales-order templates for future use.
We have also covered in-depth the list of the best apparel inventory management tools with their pros, cons and pricing.
Effective Apparel Inventory Management is a must for success
In this competitive world of fashion retail, effective inventory management is a must for success.
By carefully selecting and implementing the right apparel management system, you can overcome the challenges of inventory management and position your clothing store for long-term growth.
Investing in the right inventory management system is not just a technological upgrade; it is a strategic move that can transform your business operations and drive significant improvements in your bottom line.