Introduction
Logistics optimization and supply chain management in the apparel and fashion sector is a critical enabler for brand owners and retailers to meet the consumer’s expectations. Many of the supply chain challenges faced by the apparel and fashion industry may be addressed with product allocation though a robust Apparel Warehouse Management System.
What is Product Allocation?
Product allocation is a method of strategic inventory when there is limited product availability. To properly allocate products, you need to distribute, track, and manage inventory across your distribution network and sales channels to meet customer demand. This process can be automated and configured digitally in your Fashion WMS.
Why is Product Allocation important?
While manual product allocation is doable, retailers, especially those on eCommerce realise the impact of consumer expectation has a major impact on their business. As a result, many have started to use an Apparel Warehouse Management System to help them:
- Eliminate human error,
- Improve supply chain efficiency,
- Maintain multichannel inventory and meet customer demands,
- Capture of sales data to make better inventory planning decisions, avoid inventory wastage, better understanding of customer behaviours.
Commonly used Product Allocation Strategy
The availability of products is important to both retailers and customers, online and offline. Equal allocation, trend allocation, and seasonal allocation are some of the allocation strategies that most companies choose which can be executed and automated in an Apparel Warehouse Management System.
- Equal allocation
The equal allocation approach distributes your product line evenly across your distribution network, giving each distribution centre an equal amount of stock.
- Trend allocation
The distribution of your stock is based on where certain types of products are being sold.
If you found out that your fitness item had the highest sales transaction in the west zone, you may want to explore distributing inventory among different fulfilment centres while keeping the majority of them close to the high demand zone.
- Seasonal allocation
Seasonal allocation is similar to trend allocation in that it stores inventory in areas dependent on weather conditions.
To establish a product allocation plan that reduces logistics costs and improves last-mile delivery. This helps ensure the right amount of supply is being allocated to the right customers at the right time. However, we believed that every business is different. The parameters for an effective stock allocation need to be built with the complexity of the operation in mind.
By leveraging on a robust Fashion WMS, apparel and fashion brands are able to respond to market quickly and accurately to meet the demands of the ever changing, fast paced fashion industry, meet and satisfy consumer’ expectations in an omnichannel environment.
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