September 2022

Helping LOCATE customers find a new home

Posted on September 28, 2022 | by chrisqureshi | Leave a Comment

The choices for inventory and order management software are narrowing by the month. In July 2020, Square sunsetted Stitch Labs. In June 2021, Intuit/QuickBooks announced it was sunsetting its TradeGecko platform. In November of 2021, Xero announced October 10, 2022 as the date it will be sunsetting its LOCATE software.

The field of inventory software providers is undergoing a trend of consolidation because the few top full-featured players are becoming established as the solutions of choice.

If you’ve started an ecommerce business, are in the planning stages for one, or are expanding your brick-and-mortar to include online, implementing a flexible, cloud-based, all-in-one inventory and order management system should be top of mind.

The sunsetting of LOCATE may leave you in need of another software solution for managing your inventory. If that’s the case, how would you feel about getting an online system that could do more than LOCATE? Is your business sufficiently prepared for robust growth, for instance? Cin7 is an inventory and order management solution built to position your business for growth for years to come.

There are still several options out there, even without LOCATE. How can you know which solution to choose? How do the leading providers that are left compare to each other? Which solution is best for you?

Choosing the right alternative to LOCATE

Here are some important considerations to keep in mind as you begin to research inventory control providers.

A solution that will grow with you

The software you choose should be able to keep up with the growth of your business. A good way to estimate the future growth of your business is to take the quantity of goods you’re currently selling and increase it by a reasonable growth factor each year for the next five years.

Higher complexity online sellers are adopting Cin7, which supports multichannel sales operations and boasts over 700 built-in integrations that connect to popular accounting, shipping, and 3PL providers to handle warehousing and fulfillment.

When selecting an inventory management system, you should make sure it’s completely SaaS-based. SaaS stands for Software as a Service, which essentially means it operates totally in the cloud. Some providers are not completely SaaS based, and require physical servers to be installed in each of your locations. Of course, these servers have to be maintained.

Highly configurable multichannel D2C options

We recently conducted a survey of 4,000 online sellers. We wanted to find out what strategies the most successful sellers were applying. Of the 4,000 businesses we polled, 47% rated multichannel selling as their #1 priority.

Building a variety of sales channels allows for a more agile business strategy, one that’s less vulnerable to market disruptions. Cin7’s integrated ecosystem enables multichannel selling from all of your online and physical store locations.

We even published the survey as a fact-filled eBook. It’s available for free right here.

Strengthen your supply chain

We’ve all heard about the current state of the global supply chain. Experts tell us the disruption may not be resolved until 2024 or beyond. This underscores the importance of choosing a software provider with the richest feature set for the price to mitigate the impact of supply chain disruption wherever possible.

Compared to competitors, Cin7 comes out way ahead when it comes to feature depth. As your business grows, the ability to connect directly to major retailers via built-in EDI simplifies bulk orders and payment processing. Cin7 seamlessly connects inventory and order management to point of sale, online marketplaces, accounting software, shipping, and 3PL providers. It also includes a warehouse management system.

When it comes to integrations, no other solution can beat Cin7. With over 700 built-in connections, Cin7 creates a centralized network of real-time 360° visibility across your business and builds efficiencies in finance, order fulfillment, EDI, and 3PL.

Cin7 immediately syncs all sales and purchasing transactions with popular accounting software like QuickBooks and Xero.

When it comes to financial analysis and reporting, Cin7 boasts extensively configurable reporting analytics including pivot table-based reports to help with sales analysis and inventory forecasting.

B2B and Wholesale

Cin7 ensures you can handle inventory control, sales, purchasing, order fulfillment and payment processing for B2B orders. Cin7 includes a configurable payment portal that allows you to set payment terms, take wholesale order deposits of any amount, and process all payments.

Cost

Cin7 is priced in the mid hundreds, includes multiple users, and connections to third parties in the monthly subscription fee. Most other solutions require middleware providers to create connections and charge a recurring monthly fee per connection.

With the number of connections required to run your business, it’s financially wise to go with a provider that has already built direct connections to the leading third parties you’re going to need to work with and includes them in your monthly fees.

Don’t delay researching

October 10, 2022 is just around the corner. If you’re a growing product seller and multiple sales channels is your goal, book a demo here. One of our Cin7 sales specialists will help you find out if Cin7 is a fit for your growing business.

Why is purchase order management important?

Posted on September 27, 2022 | by chrisqureshi | Leave a Comment

There are two areas of purchase order management: the number of POs issued and the timing of them. The first means finding the right balance – failing to write up enough of the orders could result in stock shortages, which could lead to you being unable to fill your customers’ orders; writing up too many could result in you being overstocked. If you’re overstocked, the additional cost of extra storage space and labor mean your business runs inefficiently. The second, your timing, refers to when you actually issue the PO. Do you wait until you’ve used up all your stocked items, or do you take care of restocking before reaching that point? When making these decisions, you have to keep in mind not just the amount of stock you want to keep tied up in storage, but the length of time it will take for your supplier to get your goods to you. If your supplier is in another country, for instance, your order could take months to get to you. It’s all about making sure you have enough of your items on hand at all times to keep your customers supplied and happy, but not too much of it.

You can see that managing your purchase orders can help your business run better. Let’s explore purchase orders in detail.

What is a purchase order?

A purchase order is a contractual agreement between a buyer and a supplier. In the United States, it becomes legally binding when the supplier accepts it. Purchase orders are issued by a company when it wants to purchase more goods from its supplier. Basically it is an instruction for the supplier. The description lists the names of the products, their stock numbers, colors, quantity, cost, the place they’re to be delivered to, and any other requirements.

Now that you know what a purchase order is, let’s check out the role they play in the buying process.

1. Issuing purchase orders

A purchase order is written up when a company needs to add items to its inventory. If the company is small, this can be the responsibility of the owner. But if it is a large company with many divisions, the PO may have to go through several administrators for approval. The PO will be sent over to the supplier at the completion of this stage.

2. Supplier approval

When the supplier receives the PO, they go over it to make sure they can fill the order and are comfortable with any stipulations it contains. They may ask the buyer to make some changes, and there may be some negotiating between the two parties. When both parties reach an agreement, the supplier has, in effect, accepted the PO, and it’s then that it becomes a legally binding contract.

3. Delivery of goods

The supplier sends the items requested on the PO to the buyer and issues an invoice. This invoice itemizes the goods the supplier has packed and shipped off, as well as the cost of each item and the full amount the buyer owes the seller. An invoice lets the buyer check a) that it is receiving everything it has ordered, and b) that it has been sent everything it is being charged for. The buyer will also, at this stage, carefully inspect the items to make sure they’re of high quality.

4. Payment

The buyer indicates that the items are accepted by sending the supplier a goods received note (GRN). The GRN is a confirmation of having received the goods in good order. Like the PO and the invoice, it lists the products, but as a legal document, it indicates the date and time of delivery and is signed by someone who has the authority to do so. Payment of the invoice is dependent on the terms of the PO. These terms could indicate an immediate payment by the buyer, or a stated period of time after satisfactory receipt of the goods.

Explaining purchase order management

Purchase order management is an umbrella term that covers the process a business uses to handle their purchase orders. It covers everything from creating POs to dispatching them to maintaining records of them.

For a new company that’s still small, this process can be simple. Along with emails and phone calls, in these early days, a spreadsheet could be all that’s needed to record and keep track of purchase orders. But the information on spreadsheets has to be put in manually, making the system time consuming and prone to human error. These downsides only get worse as a business grows and the volume of orders increases. When that happens, a better, more manageable system is needed. That’s where purchase order management software comes into the picture.

Before we jump to PO management software, however, let’s check out the benefits of managing your purchase orders efficiently.

The importance of purchase order management

When you pay attention to purchase order management, your organization benefits in the following ways:

1. Better control over the amount you spend

Having department heads or managers approve purchase orders is a good way to control spending. In addition to making warehouse staff think about the items they put on a PO, it gives these supervisors the ability to make sure that everything being ordered is really needed and that their cost will not exceed the budget that’s been allocated for inventory. This approval process also gives managers a clear picture of how their department’s money is being spent.

2. Reduced storage costs

Keeping hold of more inventory than you need may ensure that you’ll always be able to fill an order, but it also means using up more storage space than is necessary. This unwanted, additional warehousing cost can be cut by controlling the amount you purchase. Controlling the amount you purchase is a major part of purchase order management. It means you only order when your stock is too low to cover your sales.

3. Help when it comes to avoiding stockouts

Purchase order management software automates the restocking process. This is how it works: The computer program recognizes when the inventory, or particular items in your stock, falls to a set lower limit. When that happens, the system automatically sends a PO to the supplier for more goods.

Computerizing your warehousing this way means always having the right amount of inventory to cover sales.

How Cin7 can help you with purchase order management

Cin7 is an integrated tool with several power-packed features. It can help you manage and control everything from the inventory you keep on hand to your restocking of it.

Cin7 keeps a record of all the purchase orders you create through our platform. With Cin7, you can instantly pull up specific purchase orders and generate reports for each one of them. These reports, customized by you, can include vital information such as the currency used for the order, exchange rates, customs and freight fees.

Our computerized system also allows you to save supplier details in the database. This information can be used to automatically add addresses and telephone numbers to forms, or it can generate purchase orders. It can even send the PO to the supplier. More than a time saver, when you can take care of your restocking like this, you get peace of mind.

As mentioned, Cin7 can be programmed to take care of restocking automatically. When the amount of stock you’re holding reaches a predetermined low, the system will automatically trigger a PO and send it directly to your supplier. You won’t have to worry about stockouts, and your business operations will run smoothly.

In addition to keeping track of your inventory and POs, Cin7 integrates accounting software like QuickBooks. This feature enables you to import all your POs and PO reports into your accounting system. It’s another aspect of Cin7 that improves and streamlines your business, making sure it’s as efficient as it can be.

To learn more about how Cin7 can help you manage purchase orders, schedule a call with one of our experts today.

Why your business should use supply chain visibility

Posted on September 23, 2022 | by chrisqureshi | Leave a Comment

All businesses need a strong supply chain to ensure the goods they want to sell are delivered on time, in perfect condition, and at a competitive price. Yet, the supply chain is a complicated system with many players, each with its own goals and strategies. Every step in the production process — from sourcing materials to shipping products to customers — is handled by a dedicated group of people or systems.

Having a well-functioning supply chain can save you time and money. For example, if you have trouble finding a specific product type, you can use your network of suppliers of your other products to help find it. In many ways, your supply chain is critical to the success of your business.

In recent years, there’s been a revolution in how businesses use the supply chain. As the way we buy things changes, the supply chain has undergone a transformation, changing how companies operate in many ways. One essential part of this transformation is the use of technology. Today’s businesses rely on digital tools to manage their supply chains more effectively than ever. This includes electronic data interchange (EDI), which allows companies to send and receive information.

What is supply chain visibility?

Supply chain visibility is the ability to see everything that happens in the supply chain. This includes tracking the progress of products from their origin all the way to your customer. It allows you to make sure that products are delivered on time and in accordance with your specifications. You can also track inventory levels and forecast future needs.

When a supply chain is visible, you track the flow of products and materials to ensure they are delivered on time, in the correct quantity, and at the correct cost. This helps you identify and fix problems early, preventing the development of larger issues that could disrupt your operations. Many different tools can be used to track your supply chain, including internal systems, cloud-based ERP systems, and third-party suppliers.

The increasing complexity of strategic supply chains & role of technology in managing them

One of the most critical aspects of the supply chain transformation is the increasing complexity of strategic supply chains. A strategic supply chain is essential to your overall success, and it involves multiple steps and connections between different companies. The more complex the supply chain, the more difficult it is to manage.

One way that technology has helped to manage this complexity is by making it easier to track products throughout the supply chain. This tracking can be done with electronic data capture (EDC) systems or radio frequency identification (RFID) tags. EDC systems allow you to track products as they move through the manufacturing process, and RFID tags allow you to track products as they move through the distribution process. These systems allow you to detect problems early in the process and fix them before they become significant.

Another way that technology has helped to manage the complexity of supply chains is by making life easier for purchasing and planning departments. Purchasing departments now have access to more information about their suppliers, including information about the products those suppliers are manufacturing. This allows purchasing departments to be more efficient in selecting the best suppliers and helps them stay competitive in their industry. It also helps companies ensure that their supply chain remains stable and reliable.

Another benefit of technology is that it allows you to expand your sales worldwide and across different regions of the country. For example, you might have factories in several other countries or need goods produced and shipped directly to stores in another region. With modern technology, this kind of operation can take place with ease, as each factory in the supply chain can use technology to get information on how to produce, package, and ship all of the goods they’ve been tasked with supplying.

How does technology help make a supply chain visible?

Technology has helped in increasing supply chain visibility. One of the most important ways technology has done this is by creating a digital trail. This trail records all the actions that have been taken along the supply chain, from the sourcing of materials to the delivery of goods to the customer. This information can be used to track down any issues that may have occurred and to make adjustments as needed. It can also help companies to improve their communication with their suppliers. Two technological advancements in the supply chain are the use of big data and Internet of Things (IoT) technology.

Improve analytics with big data

With automation of the supply chain, more data are available for statistical analysis. This can lead to better decision-making at every stage of the supply chain. For example, in your warehouse, picking zones and warehouse space allocation can be determined by analyzing data on the most popular products and efficiency of workers. Similarly, production scheduling and transportation processes may be improved by analyzing such facts as cost, inventories, capacities and consumer patterns.

See more with Internet of Things technology

Although not widely used in the supply chain yet, IoT technology has huge potential. IoT refers to objects that are connected to one another or to a central sensor and communicate with one another. For instance, sensors may be placed on freight containers that report their location and condition to a central source. By tracking devices and data in real time, you can take corrective actions, such as replacing a shipment of food that has been exposed to unsafe temperatures. You can also collect data that over time can reveal patterns, such as where you consistently have bottlenecks in your distribution, that can be used for predictive analysis and preventative measures.

How does supply chain visibility enable better inventory management?

By digitizing and automating various aspects of your supply chain, you can improve your inventory management.

Improve inventory management

Inventory management is an important part of any business. It’s essential to be able to track inventory so that you can make sure that you’re always getting the supplies that you need and minimizing the amount of inventory that you have on hand. By having high supply chain visibility, you can ensure that all the different parts of your business are working together as a cohesive unit. This will lead to increased efficiency and reduced costs overall.

Maintain healthy inventory levels

Maintaining healthy levels of inventory allows businesses to avoid excess stock that can lead to increased costs and reduced profits. By automating your inventory, you’ll be able to submit orders for high volume products and make decisions about poorly performing products more quickly, allowing you to maintain healthy inventory levels. This will help to ensure that the inventory remains in good condition and does not exceed the company’s needs.

Boost demand forecasting

By using big data analytics to understand which of your products sell well at certain times of year, you can better predict demand, plan for shortages and manage your inventory effectively.

How can Cin7 improve your inventory and supply chain visibility

There are many possible reasons brands lose track of their stock. Generally speaking, though, a lack of visibility tends to come down to inadequate inventory management. If your inventory management system doesn’t automatically include purchases, sales, and other activity that impacts the big picture or if it doesn’t track information in real-time, the information you have about your inventory is not complete nor up-to-date. Here are two common examples:

1. Using manually updated spreadsheets

This is one of the biggest reasons for lack of visibility. Small companies that sell few products can manage fine with spreadsheets. With even a little growth, however, spreadsheets can get out of date quickly, giving you a lack of visibility of what’s in your inventory. Reported stock levels will not match reality, and you may not realize it’s time to restock.

2. Managing sales channels and inventory separately

When you use separate systems for sales channels and inventory, you risk overselling your inventory. For example, if you are a company with a Shopify store and you add Amazon Seller to your channel mix, you will now have at least two places to track inventory, plus any spreadsheets or siloed inventory software you may use as a “master.” The information in your master inventory depends on the people who collect and update the information. If the information is even a little off, the company could end up selling customers a product that isn’t available.

Inventory visibility cannot be an estimate of the products you think you have. It must be the actual inventory based on current sales and any other activity that impacts accurate stock levels and locations, such as purchases, which increase inventory, and branch transfers, which move products to different locations.

How to achieve inventory visibility

Proper stock visibility requires accurately recording everything that happens to products in your inventory. This includes purchases, sales, stock transfers, returns, and any workflow that changes inventory quantity, location, or cost. To that end, visibility can only be achieved if all data are integrated with and tracked in a central inventory master, including:

All purchases that increase your inventory of components and finished goods,
Production jobs that lower component inventory and increase finished goods inventory,
Sales orders that reduce your inventory,
Dispatched orders that reduce stock on hand and change order status,
Purchases and sales that adjust inventory at each stock location,
Stocktakes that confirm or adjust inventory at each stock location, and
Stock transfers that decrease inventory in one location and increase inventory in another.

The key to visibility is to integrate your data so that you can track products in real-time as they move through your supply chain, affecting stock levels and inventory value along the way.

The benefits of inventory visibility

Integrating data allows your company to

Reduce data entry and eliminate related errors.
Eliminate the use of redundant software and portals.
Increase order accuracy.
Maintain optimal inventory levels / reduce overall storage costs.
Fulfill orders faster and increase order transparency.
Build customer satisfaction and drive future purchases.
Increase forecast accuracy for improved inventory planning.
Reduce losses due to obsolete inventory.

Achieving inventory visibility is simple with Cin7

By providing real-time visibility into the status of shipments, Cin7 helps companies to identify potential issues in a timely manner and take corrective action. By using Cin7, businesses can confidently rely on the software to help them make informed decisions about their business operations. Book a free, no-obligation demo below to learn more about how Cin7 gives product companies complete, real-time inventory visibility. Request a Demo.

5 elements of an optimized inventory management system

Posted on September 16, 2022 | by chrisqureshi | Leave a Comment

Retail businesses have an average of 20% inventory to sales ratio. This I/S ratio compares the value of your inventory with the amount you make from selling your goods. The I/S ratio is arrived at by dividing the revenue made from overall sales by the value of the stock that’s kept. So, with a 20% I/S ratio, if you make $100 from selling your items, your stock would be valued at $20. More simply, the I/S ratio here would be five (revenue made from sales divided by value of stock). Maintaining the I/S ratio that’s best for your business is key to maximizing profit. If there’s too much stock, profits are compromised; if there’s too little stock, orders might not be filled. Optimization is the key. What are the best ways to optimize inventory? And, what are the five elements of an optimized inventory management system? Let’s find out.

If you are a businessperson, deciding the amount of inventory you should keep on hand is crucial. If your stock runs out, or if you have too much of it, the consequences could be serious. There could be financial losses and your reputation could be damaged. The only way to avoid this is by having optimum inventory on hand, or the right amount you need. This article will help you to understand what inventory optimization is and explain the five elements of an optimized inventory management system.

What is inventory optimization?

Inventory optimization means maintaining an optimum amount of stock, stock being defined as all the stock-keeping units (SKUs) that are being held by a business. When a company has an optimum level of stock, its working capital is being used to its best advantage.

Overstocking inventory can result in

Working capital being tied up in unneeded stock.
Stock going out of fashion and becoming unsellable.
Workers spending time and energy unnecessarily.
An elevated risk of loss of goods to theft or accidents.
Valuable storage space being used unnecessarily.

On the other hand, understocking and stockouts can result in

Turnover being halted.
Company reputation being damaged.
Production lines being broken.
Workers’ time being lost.

Inventory optimization can eliminate these losses. Put another way, when optimal levels of inventory are maintained, resources, like physical space, labor, and capital, can be used in their most efficient ways.

5 elements of an optimized inventory management system

As we saw earlier, it is crucial to optimize the amount of inventory you keep at all times. But in order to do this right, what should you be focusing on? Let’s look at the key areas in detail.

Graded policies for inventory management

First, your stock policies should be clearly defined, and you should let the relevant people know about them well in advance. It isn’t helpful if the purchasing department is kept in the dark about these policies.

The inventory turnover ratio indicates the liquidity of the inventory, or the number of times the average inventory is sold during the year. It shows the efficiency and effectiveness of the company in investing its funds.

Inventory turnover time is the number of times a company replenishes its stock in a given period, generally a year. In other words, if you sell stainless steel spoons, the inventory turnover of finished product — spoons — is the number of times you sell out of spoons and replace them. The following formula shows how to calculate the inventory turnover ratio:

Inventory turnover ratio =	Cost of goods sold
	Average value of inventory

where,

Average inventory =	Opening inventory + closing inventory
	2

Cost of goods sold = Opening inventory + purchase – closing inventory

Now you know how many times a year you have to refill your inventory. The following categories of inventory are dependent on this ratio.

Fast moving – Fast-moving inventory is that which is used or sold in a short or easily known period of time. This period is different for every industry. The inventory turnover ratio will be higher for goods in this category.
Slow moving – Slow-moving goods are those that stay in your warehouse for a more extended period of time. The inventory turnover ratio for these types of goods will be lower.
Non-moving – Non-moving or obsolete goods are those stored in your warehouse for a long time because there is no market for them. This inventory is also known as dead stock.

These three categories should be a major consideration when making purchases. Separate your stock into each one, and invest more in goods that are fast moving than those that are slow-moving.

Realistic demand forecasting

Forecasting demand is, perhaps, the first step when it comes to good inventory management. Forecasting demand accurately is not an easy task, however. There are many aspects that have to be considered: historical sales data, customer biases, future demand, and growth. Additionally, it is crucial to take technological advances and trends into account.

How can you predict demand for your products accurately? Well, quality software can help. Cin7’s system generates reliable demand forecasting reports. Cin 7’s forecasting demand report can make your job a lot easier.

Determining product life cycle

The term product life cycle is defined as the period between the product’s initial production to the time it is no longer sold. If you launch a new product, sooner or later it will stop trending and your customers will move on to something else. There are five stages to a product’s life cycle that impact your inventory management:

Introduction – There is less awareness at this stage, so the demand is less, and there is no need to stock a lot of products.
Growth – Awareness of the product is on the rise, and the company should be prepared to fill more orders.
Maturity – This is when demand reaches a plateau. Demand will still be high, so the company won’t have to make changes to the level of stock it maintains.
Decline – Here, the company realizes that demand is dropping. Customers have had enough of the product and are buying less of it. When this point is reached, the company needs to reduce production and focus on replacing it with something new. This is also the time to push more of the product by offering discounts and rewards.
Obsolete – Now the product is totally out of demand. Any remaining inventory you have becomes dead stock.

The life cycle of a product can be short (a few months) or long (spread over years). These life cycles have to be taken into account when forecasting demand for your product. Doing this accurately will prevent overstocking or understocking,

Timely restocking

Your purchase department should have clear restocking instructions. Every item in the inventory should have a specific reorder point (ROP), a predetermined level of goods at which they have to be restocked. When determining this reorder point, you should consider:

Safety level for stock: This is the minimum amount you will need on hand to tide you over until your new order arrives. You don’t want to run out of stock.
Logistics: You have to consider the time it takes to get your goods to your factory or warehouse.
External factors: These include weather, political upheavals, and labor issues. Any one of them can affect your delivery time.
Supplier lead time: This is the time it takes your supplier to dispatch your products. Suppliers have different lead times.

Management needs to be aware of ROP to ensure stock is replaced in a timely manner. Inventory management software like Cin7 can send alerts that let you know when you reach this ROP.

Investing in reliable inventory management software

If you find inventory management challenging and are intimidated by the sheer number of calculations that have to be made, here’s an easy solution: Cin7. This versatile and easy-to-use software can help you manage your inventory easily. Among the features it has to make your life easier are

Determining reorder levels,
Alerting you when you reach ROP,
Sorting third-party logistics (3PL),
Helping you with B2B ecommerce,
Generating reports on COGS, forecasting, cashflows, and inventory on hand, and
Integrating with other software and mobile OS.

The following video shows how Cin7 inventory management software can help you take your business to the next level:

One of the significant advantages of Cin7 is its inventory management app. This app lets you connect to your inventory management program from anywhere.

Final take on inventory optimization

While inventory optimization is a crucial element of a successful business, it is also painstakingly tricky and complex. Overstocking can lead to losses, while understocking can damage your reputation. How can you overcome these dilemmas? Cin7 inventory management software turns the whole ordeal into a piece of cake.

Why wait? Contact our experts for a demo, and unlock the true potential of your inventory.

How can third-party logistics (3PL) improve your supply chain?

Posted on September 15, 2022 | by chrisqureshi | Leave a Comment

Nowadays, when it comes to businesses moving their goods through their internal systems, disruption seems to be the new normal. Events like a pandemic, trade sanctions, and war can seriously affect this supply chain, creating problems for internal logistics, and ultimately, the delivery of goods. To avoid this, companies should be thinking of ways to overcome these obstacles, putting strategies in place to ensure the smooth running of their supply chains.

A good solution to these problems is third-party logistics (3PL) software.

In this article, we’ll take a deep dive into 3PL and show how partnering with a 3PL company can streamline your business and make it more efficient.

What is 3PL?

There’s 1PL, 2PL, and 3PL, and PL stands for party logistics. The first, 1PL, describes a business that directly delivers its orders to its customers. The second, 2PL, means that a business hires an outside courier service to deliver goods to customers.

In 3PL, a business outsources its supply chain management to a third party. This could include everything from internal logistics to order fulfillment, or any aspect of it.

3PL services you can use include:

Warehousing,
Transportation,
Picking up,
Packing, and
Last-mile delivery.

You can choose the services offered by 3PL according to your needs. However, since 3PL providers focus totally on logistics, using their expertise to streamline your internal processing and order fulfillment can only improve your supply chain.

How does 3PL work?

Well, that depends on which services you use. But as an overview, this is how a typical 3PL arrangement works:

Your entire inventory is stored at a 3PL warehouse. Here, SKU numbers are assigned to your items for easy identification, and they are separated into designated bins.
When a customer places an order with you, it’s forwarded to the 3PL company for fulfillment. To make it even easier, modern order management software will automatically send the order to the 3PL provider’s warehouse. You don’t have to do anything.
At the warehouse, a team breaks down your customer’s order, identifies the storage location for each item, and retrieves them.
When all the necessary items have been collected, they are packed in a delivery box, which is sealed shut. An order receipt and shipping label are then printed and attached to the outside of the box.
A shipping carrier, organized by the 3PL provider, picks the box up from the warehouse and delivers it to the customer.

This is how a 3PL provider helps you with order fulfillment.

How leveraging 3PL in a supply chain can help your business

Let’s discuss how a 3PL provider can benefit you.

1. Cost benefits

If you choose to do it alone, you’ll have to buy or rent your own warehouse space. That, of course, would mean hiring and training staff to work in the warehouse.

3PL can eliminate this expense, enabling you to put more money into other areas of your business, such as sales and marketing. A move like that could increase your revenue. What’s more, since 3PL providers specialize in logistics, extensive networks they have in the supply chain means they can negotiate better rates.

2. Focus on core competencies

Handling the fulfillment process on your own, means going through a painful trial and error period while you set the system up. Inefficiencies in your warehousing and order processing will cost you time and money.

You won’t have to worry about any of that if you use 3PL. They’ll take care of warehouse management, carrier selection, the paperwork, and choosing the best shipping routes. After all, who better to handle your fulfillment than those who specialize in it, right? Using 3PL will free up time you can spend on your core competencies, leaving the 3PL you use to leverage theirs.

3. Access to expert knowledge

In the logistics industry, 3PL companies are well regarded. Their deep knowledge and technical know-how could be a game changer for your business if there’s a disruption in the supply chain. That’s because if an unforeseen circumstance occurs, they are able to make the necessary adjustments to ensure that your order gets fulfilled as quickly as possible.

The fact that they specialize in supply chain management means that they’re constantly upgrading their systems and using sophisticated technology like a warehouse management system (WMS).

All this helps track inventory in real time, giving you information you need to make good, data-driven decisions for your business.

4. Flexibility

If you are planning to expand into new territories, a 3PL can offer you flexibility. It can enable you to test new ground without having to put money into warehousing or staffing.

It means, in short, that you can try out a new market with limited upfront cost to see if it’s worth it or not.

5. Ensures compliance

Whether you plan to fulfill orders locally or globally, you need to comply with many federal, state and local laws. Joining hands with a 3PL provider can help. Regulations can be complex, and constant updating means they change over time. Working with a 3PL ensures that your logistical operations are compliant with the law.

For instance, if you deal with consumer packaged goods (CPG), a 3PL can make sure that perishable items are not only kept at the stipulated temperature, but that they’re handled properly until delivered to the customer’s doorstep. This includes proper labeling, like clearly showing when a product is hazardous. Taking care of these issues shelters you legally.

When it comes to international compliance, 3PLs are especially helpful. They can take care of all the required paperwork, from customs to transportation documentation, ensuring that your international deliveries are smooth and stress-free.

Let Cin7 help you integrate 3PL into your business

Now that you’re clear about the advantages of 3PL, you may want to use it to streamline your business. Cin7 could be a good way to do this.

Cin7 works with 200+ 3PL providers, and the list is constantly updated. By using Cin7, your orders will immediately be routed to a 3PL warehouse for fulfillment, freeing you from the cost and hassle of having to take care of that yourself.

In addition to 3PL, Cin7 provides a complete suite of features that do everything from managing your inventory to giving real-time visibility. Cin7 lets you manage your inventory, orders, and fulfillment in a much better way.

Book a demo with our experts to learn more about how Cin7 can help you with 3PL.

12 reasons why using the Cin7 inventory management system for your Amazon business is beneficial

Posted on September 14, 2022 | by chrisqureshi | Leave a Comment

Amazon.com is undoubtedly the number one name in ecommerce. It has dwarfed every other ecommerce platform. Thus, if you are thinking about becoming —or already are — an Amazon seller, you are on the right path to increasing your turnover. How can we help take you further? Here are 12 reasons why using the Cin7 inventory management system for your Amazon business is beneficial.

Reason 1: Centralized inventory management

How would you feel if you bought something on Amazon and received an email two days later telling you that your item was out of stock? Not good, right? You probably wouldn’t order from that supplier ever again.

If you are a supplier, you wouldn’t want any of your customers to go through that experience.

As a supplier, you might be selling on multiple channels. Without a centralized inventory management system, you might find yourself selling a particular product on more than one of these channels simultaneously, possibly overselling and leaving you unable to fulfill orders. The damage to your reputation as a business that a miscalculation like this can cause cannot be overstated, but it is something that can be easily avoided.

Cin7’s inventory management software allows you to maintain multiple points of sale – either physical or online – on a single system. It updates your inventory in real time on all platforms. This real-time inventory accounts for sales, purchases, transfers, and loss of goods.

Reason 2: Higher visibility

When you have an integrated inventory management system, you have a holistic view of your inventory, a complete overview that clearly shows you what’s been purchased, sold, and is on hand. It also lets you know the exact point at which you need to reorder stock.

An added benefit of Cin7 software is that it gives you up-to-date sales figures for each platform you use. When it comes to Amazon, Cin7’s software has an integration tool that tells you exactly how much you’re selling on that marketplace and when a sale has taken place. This information – found on your Cin7 reports – lets you know when to increase or decrease your inventory. The result: profit maximization for your company.

Reason 3: Cost control

If you use Amazon Central, you can add or delete your listings on its Excel sheet online. However, those changes only apply to Amazon.com. They won’t have any effect on other selling platforms you use. To do that, you’ll have to make changes to each platform you use individually.

If you use Cin7’s inventory management system, however, you can add or delete an item with just one click. The software lets you make alterations to your stock on all the platforms you use simultaneously. Being able to do this not only reduces administrative efforts, it can drastically lower your cost.

Reason 4: Product identification

Barcodes and radio frequency identification (RFID) tags uniquely identify every product in the inventory. This type of identification provides product details, including size, color, material, and warehousing information. These barcodes and RFID tags help keep track of your product as it moves through the system, meaning that you’ll know where an item is at all times. It also means you’ll be made aware if something is lost or stolen.

Reason 5: Reports and forecasting

Inventory management systems have a specific feature called reports and forecasting. The Cin7 software has higher accuracy in forecasting than others. The way it works is that the system tracks the historical data entered and uses it to make predictions about future needs for your business.

These forecasts apply to inventory needs and sales predictions on every platform. Reports of this kind help you make better business decisions, decisions that will lead to greater success.

Suppose you only sell on Amazon and use Amazon Central to manage your inventory. While that’s OK on one level, Amazon’s system won’t let you analyze your stock as easily as you could with a general inventory management system. The deeper knowledge a general inventory management system can give, like forecasting and detailed reporting, allows you to make informed decisions that could help grow your business.

Reason 6: Assisted decision making

Strategic decision making is probably one of the most complex, and important, parts of running a business. The key issue is to place orders in such a way that your products are neither overstocked nor understocked. Cin7’s inventory management system can help with these decisions by:

Calculating reorder points (ROP) for each of your products.
Giving alerts when the stock reaches ROP.
Programming automatic reorder emails that are sent to suppliers when the stock reaches the ROP.
Tracking price changes.
Tracking the inventory on each selling channel.

The inventory management system can ensure you don’t run out of stock on any platform, including Amazon. It can also reduce the time involved in making decisions about reordering.

Reason 7: Integrations

A first-rate inventory management system allows integrations with third-party software and apps. If your inventory management system doesn’t work with other apps you use in your daily routine, you will find yourself in trouble. Cin7 integrates with over 700 apps.

Reason 8: Payment portal

Cin7’s inventory management systems has an integrated payment portal that can receive online payments. This helps you maintain account receivables, handle orders through the supply chain, and email invoices to customers. Automating the payment portal speeds up the payment process and fulfillment of the order. The system also lets you email payment links to customers. This not only provides an easy-payment method for customers, it gives them an instant confirmation of their order, assuring them that they can trust you.

Reason 9: Customer satisfaction

Customers who don’t have issues to face when they make a purchase, like problems with delivery and payment, tend to develop trust in you as a seller and are more likely to return for their next purchase. Cin7’s inventory management system takes care of all these aspects of your business, which promotes maximum customer satisfaction. This frees you up to concentrate on improving the quality of your products.

Satisfied customers don’t just give you repeat orders, they are also more likely to give you positive feedback online, helping to attract new customers. Increasing your overall customer base this way will lead to higher turnover. Online reviews, in fact, are very important to online marketplaces. With Amazon, for instance, it’s been observed that 90% of customers typically read reviews before visiting a business or making product decisions.

Reason 10: Calculation of Amazon commission

Amazon lets you sell your products on their platform for a commission. When customers make a purchase from the Amazon website, the full amount they pay goes to the online marketplace. Before Amazon passes that money on to the seller, they deduct their commission. The calculations for these sales and commissions are straightforward if you only sell a couple of products. But they become more complicated the more your business grows. Cin7’s inventory management software reduces your calculation woes. It will help you track your sales and keep on top of commissions Amazon has deducted.

Reason 11: Fulfillment by Amazon (FBA)

Amazon has warehouses that can store and ship your products to your customers for an extra charge. The system is called Fulfillment by Amazon or FBA. If you choose to sell your products through FBA, Cin7’s inventory management system will let you track:

FBA shipping plans,
Route orders for dispatch from the stock location closest to the customer, and
Direct Fulfillment (for Amazon Vendor).

The processes for selling, shipping, and payments can be made easier when you use a reputable inventory management system for Amazon sales.

Reason 12: Built-in electronic data interchange (EDI)

Electronic data interchange (EDI) is the electronic exchange of information between two or more companies in a standardized format. An Amazon seller is a person who sells goods they manufacture. An Amazon vendor is a business who resells or trades goods manufactured by somebody else. The customer is fully aware if they’re buying from a manufacturer, the seller, or a vendor.

If you’re a manufacturer and you have multiple vendors, it can be difficult to manage their accounts and keep track of the stock they have. Cin7 Amazon integration helps you by managing the EDI with your vendors easily. It allows you to do the following:

Product mapping,
Order downloads,
Order status updates,
Stock adjustments,
Stock availability, and
Bill of materials (BOMs) for product bundles.

Thus, whether you’re a manufacturer with multiple vendors or are a vendor with multiple suppliers, Cin7’s inventory management software makes it easier to run your business.

Final thoughts on 12 reasons why using the Cin7 inventory management system for your Amazon business is beneficial

A reliable inventory management system should reduce administrative expenses and clerical tasks. If you sell on multiple channels, being able to organize your inventory to make sure you aren’t overstocked or understocked is crucial.

Amazon is one of the biggest ecommerce platforms, and listing your products with them can widen your market. Using a Cin7’s inventory management system is a good way of managing your online and offline points of sales. It helps you stay on top of every stage of your selling business, from buying your inventory to fulfilling your orders.

Merrell NZ: How to build a highly engaged customer base

Posted on September 9, 2022 | by chrisqureshi | Leave a Comment

This is a guest blog post written by Cin7 partner, Marsello. Learn more about our partner program.

Email marketing is a key sales tactic for retailers and product sellers, so it’s important to have an active, responsive database. That means consistent or growing engagement (open and click rates), a high repeat purchase rate, and growing average customer lifetime value.

In this article, we’ll look at how Cin7 and Marsello customer Merrell NZ builds their customer database, which boasts a 15% repeat purchase rate and an average purchase frequency of 3.5x.

Did you know? 50% of consumers buy from marketing emails at least once per month, and 59% say that marketing emails influence their purchase decisions (Salecycle, 2022).

How to build a highly engaged customer base

1. Collect high quality contacts

Merrell NZ use a clever tactic to ensure the best quality contacts are added to their database: They ask for more than just an email address.

This might seem contradictory — surely the more information you ask for, the fewer leads you get? But Merrell NZ know that their most valuable customers are those who are willing to give just a bit more information.

This pop-up has a 25% sign-up rate. That’s incredible.

Here’s why the pop-up works:

It gets to the point in the first two sentences.
It’s aligned with Merrell’s beautiful, down-to-earth brand.
It offers VIP rewards in return for contact information (and everyone knows giving your date of birth means birthday goodies!)

For a business that understands how valuable its database is, this tactic is perfect.

Top 3 Pop-Up Mistakes:

No offer, promise of value, or incentive
No obvious purpose (too wordy, or an unclear offer)
Poor user experience (for example, it’s hard to get the pop-up to close)

2. Leverage email automation

Merrell NZ is building even stronger relationships with their customers with automations. Triggered when customers take a specific action or meet certain criteria, automated emails help Merrell NZ deliver a highly personalized customer experience.

Marsello “gives us the opportunity to link customers from our retail and web stores, work around customer retention and automate email marketing flows in a really clever way,” says José Matiz, Retail Manager for Merrell NZ.

“For us, Marsello was a game-changer, we have been using it for over a year. We started with email marketing and now moved on to loyalty programs and several automations, it’s amazing,” says José.

Above: Merrell NZ’s abandoned cart automation, set up in Marsello.

Automated emails, triggered by a customer action, get 8 times more opens than manual, bulk emails. Here are two very effective automations you can set up in just a few clicks:

Welcome emails: More than 80% of consumers will open a welcome email, and these automated welcome emails see up to 10 times more clicks than other manual emails. You can deliver immediate value with a thank you discount or voucher to make a great first impression, introduce them to your brand, and encourage them to buy again.
Abandoned cart emails: Send a friendly reminder to customers if they abandon their cart. This reminds your customers to come back to your store and complete their purchase. On average, each abandoned cart email generates $5.64. In comparison, the average promotional email generates $0.02.

3. Use segmentation

Customer segmentation is the process of dividing customers into groups, allowing retailers to do more targeted and effective marketing.

Segmentation is a powerful antidote to poor database engagement and low email open rates. According to research by Hubspot, 78% of marketers reported that segmenting their database is their most effective email marketing strategy. In an analysis of more than 100,000 emails, Hubspot found that segmented email lists had 12% higher click-through rates than emails sent to an entire database.

You can segment your database in any number of ways, allowing you to discover and create different cross-sections and niche subgroups within your database:

Demographics: Segment by common customer characteristics such as age, gender, or life stage.
Geography: Segment customers based on country, state, or city.
Behavior: Segment customers based on their activity at your stores such as last purchase data, repeat purchase rate, or the number of loyalty points earned.
RFM: Segment by Marsello’s RFM groups based on purchase recency, frequency, and spend. (most valuable customers, at-risk customers, window shoppers, and more).
Or any combination of the above.

Merrell NZ: Creating segments of your best customers

Merrell NZ’s average repeat purchase rate across the database is 15%, but some groups of their customers purchase more frequently than others. Merrell NZ uses loyalty program tiers to create segments of their most engaged customers for VIP marketing.

Above: Segment your marketing lists with Cin7 + Marsello.

Sending targeted marketing to your best customers, like this, is smart. Roughly 80% of a business’s profits will come from 20% of its customers—that is, your regulars. These customers are brand-aware, highly likely to engage with your emails, and are very unlikely to unsubscribe.

Retailers can also send more frequent messages to those who are loyal brand followers (although you’ll see your best engagement if you don’t send more than five emails per week).

Some customer database tips

Email marketing is all about quality, not quantity. Sending targeted, considered emails to smaller groups will often outperform bulk emails to your entire database.
Database hygiene will help engagement and reduce costs. From time to time, remove contacts from your lists if they haven’t responded to win-back campaigns, or haven’t opened emails in a long time.
Get more granular, detailed customer data for better segmentation. Connect your online and in-store sales channels to your marketing platform for the best results.

Cin7 + Marsello

Powered by Cin7 and your e-commerce data, Marsello works seamlessly in-store and online to provide a true omnichannel customer experience.

Capture in-store and online customer details
Deliver personalized and timely automated marketing
Incentivize repeat purchases with email, SMS, a loyalty program, and more
Grow your average basket size with advanced product recommendations
Accurately track and attribute sales to your marketing activity

Book a demo with Marsello