Retailers should leverage automation and artificial intelligence-driven insights to cut down operational costs and lower the cost of goods and services, according to RELEX Solutions, a company that provides a supply chain and retail planning platform.

Inflation and other economic challenges contribute to the rising prices of goods and services in the Philippines. AI helps predict the impact of demand drivers such as promotions, prices, product displays, and weather data to accurately forecast demand and optimize replenishment. For retail operations, this means that they can better allocate their manpower and avoid losses.

“The evolution of artificial intelligence in retail is very timely due to the need for businesses to save up money as current economic conditions push customers and partners to minimize expenses,” Kristie Davison, VP for APAC at RELEX Solutions, said in a statement. “AI helps retailers eliminate excess costs and manage their cash flow for better business sustainability.”

RELEX Solutions’ automated demand forecasting prevents oversupply of goods
How can promotions drive profitability across distribution channels?

Inventory management for omnichannel

While retailers are expected to have an increase in foot traffic, online channels will continue to be prevalent due to the convenience and savings they offer through digital promotions. 

With the increased demand for omnichannel, RELEX Solutions said retailers should focus on removing silos within their e-commerce and brick-and-mortar businesses and start managing both as a single, unified business. 

“This transformation is a laborious task that requires accurate, real-time reporting to adequately manage customer expectations, making it essential for retail brands to integrate solutions powered by AI,” the company said in a media release. “The right tools ensure fulfillment of online orders from stores, customer backorders, and online orders are correctly accounted for in forecasting and inventory planning, even as products are redirected from one fulfillment center to another.

Customer experience

The efficiency of a retailer’s replenishment operation is critical to maintaining customer satisfaction and business profitability. However, a recent study by RELEX Solutions found that close to 50% of retailers don’t know how much stock they have in each store, revealing a gap in the strategic approach to accurate and effective store ordering among these companies.

“To stay on the consumers’ radar, retailers need to prioritize efficient replenishment systems that address customer needs without burdening resources,” RELEX Solutions said. “With consumers being able to shop anytime and anywhere, AI and machine learning technology help brands keep the right amount of inventory, forecast changes in demand, and adjust replenishment orders, driving improvements to service, sales, and customer satisfaction.