Question

Why it is important for a retailer to develop a model or strategy to manage its inventory? Why has this been one of the successes of Walmart? Please answer this question in detail. Thank you.

Answer 1

Inventory management is the mechanism for maintaining the products accessible and sold together with handling inventory so the retailer never gets out of it. Inventory management is a time-consuming and complicated method and is generally the top priority for retail decision-makers. Unless you have a very particular and slim product combination, you're likely to end up spending a lot of time simply monitoring inventory. This is a very significant method, of course, and once finished, the power of the company will become. Remember, inventory management includes many supply chain units, and each unit may end up using another monitoring scheme.

With the booming contemporary retail industry and ecommerce entering the market, it is very crucial for a retailer not to delay the accessibility of the item. If a customer doesn't discover what they need, they're just moving to another retailer. Inventory helps handle the shipping time by getting a prepared inventory of products at all times. There is also a strong likelihood that manufacturing will be uniform throughout the year, but purchasing patterns will change; festivals and holidays will see a purchasing boom, while a purchasing dip will be seen at the end of a financial year. During a price or inventory review, retailers may want to hold back products, boost demand or give discounts.

Focus on product range optimization. A tight inventory contributes to better stock management, reduced warehouse expenses and also eliminates the chance of successful expiry or becoming more difficult to sell.

Although it is optimal to create a lean inventory, this may be a difficult job to accomplish. With enhanced retail market competition, discount battles, retailers are rethinking and realigning their product lines to make them more important and attractive to consumers. This often includes diversifying the families of the products as profits are thought to boost. Keep in mind that the implementation of new products often kills on racks the older products. Optimize before you diversify.

Inventory management by Walmart Inc. is one of the largest contributors to the multinational retail business ' achievement. Considering the company's mammoth size, effective and efficient stock management is critical in operational efficiency. Walmart is renowned for its inventory management aspect of activities for state-of - the-art technological apps. The business has perfected the art of innovating techniques and strategies for inventory management. Thus, in optimizing inventory management efficiency, Walmart is an illustration of the advantages of sophisticated technology and innovation.