Quarantines and lockdowns around the world have driven an unprecedented number of consumers to ecommerce for buying goods. Though this mass digital exodus appears to be a boon for online sales, experts have predicted a deceleration in the industry’s growth. In spite of that, the burgeoning opportunities in this industry are still encouraging online sellers to participate in droves.
The bigger question is, in such an unpredictable market, how can an online seller sustain and outperform the competition and grow their business? One of the prime factors that can help here is effective order management.
The 3-point order management framework can help businesses inject efficiency into its downstream, reverse, and upstream logistics. This framework encompasses 3 key aspects of order management—sales, returns, and procurement.
Let’s take a look at how this framework can be put to effective use for online sellers using analytics.
Being out of stock is a chronic reason for businesses to underperform, and it can be especially disastrous during a seasonal sale. It’s of prime importance for businesses to keep a close watch on their inventory to ensure optimum stock levels to meet their revenue targets. One of the most commonly adopted strategies for optimizing inventory is ABC analysis.
This actionable report analyzes inventory by sales volume and value. Based on sales volume, the industry in which you operate, seasonality, and other factors, you can categorize inventory as A, B, and C. Category A is fast moving, B steady moving, and C slow moving items.
By diving deep into inventory data and tagging them accordingly, businesses can be well prepared for the future, and especially seasonal sales. With these micro-level insights on products, teams will know the products that need to be procured, stocked, and shipped to maximize revenues.
One of the key KPIs in downstream logistics is sales. By adding a layer of granularity on sales, online sellers can further enhance their downstream business efforts. This is possible by analyzing sales by multiple dimensions.
Here are some examples:
Analyzing historic sales by region to understand the top performing markets
YTD analysis to assess current business performance
Sales forecast analysis to align business efforts proactively
Sales by region
Historic sales data is visually analyzed in the form of a geomap. This can enable you to identify top performing markets and align your operations accordingly. It also gives you a reading on your customers. By further understanding your markets, you can consider tailoring your marketing campaigns with some regional flavor!
YTD sales is a key metric in assessing a business’ current versus past performance. It helps you understand if your sales have grown, shrunk, or stagnated, compared to the previous year. This analysis can be a part of your growth toolkit, to help refine your growth plan further.
With advanced predictive analytical capabilities, you can forecast any business metric, and sales is no exception. Ascertain how your sales numbers will look in the future and proactively plan your business activities, like investments, marketing spends, procurements, and many more.
Returns management is one of the most crucial functions in supply chain management. The finer the analysis on returns, the better it gets to handle them. Otherwise, losses associated with returns can eat into revenue.
As a first step, businesses can categorize their returns as recoverable and non-recoverable. Using the powerful formula engine built into an advanced BI platform, the losses incurred can be measured, and corrective action can be deployed to optimize them.
Based on the categorization as recoverable (or receivable) and non-recoverable (or credit only), the returns are analyzed across return quantity and value. This helps you identify the most-returned products by value and volume. Keeping this as a baseline for your analysis, you can further probe into the reasons for the returns.
As an extension to this analysis, you may also analyze the returns across warehouses, locations, and more, which can unearth hidden insights to optimize your returns.
With advanced analytics, businesses can add a layer of insights to their inventory data. This can transform your business data into actionable insights, empower teams to drive efficiency into your order management process, and grow your business.
We’ve explained the step-by-step process to build these reports in our webinar on 5 must-have inventory reports for online sellers. Watch now.
And then sign up to explore how Zoho Analytics can transform your inventory data into contextual insights for business growth.