Retail cloud computing: The key benefits of moving to cloud-based SCM

By Karin Kelley

| Retail

According to eMarketer, global retail sales are expected to reach nearly $28 trillion in 2019, up from $22.512 trillion in 2015. In order to meet this demand, many retailers are adopting new technologies. The rise of omnichannel retail is also increasing this need to adapt. The fact is, customers expect to be able to make purchases from whatever channel they choose in a fast, efficient manner.

To make this happen, retailers are increasingly working to update traditional supply chain management (SCM) systems by embracing retail cloud computing. By using cloud-based SCM technologies and services, retailers can gain visibility and track inventory throughout the entire lifecycle, allowing them to ultimately become more agile, profitable and relevant to today’s tech-savvy and increasingly demanding consumers.

Benefits of retail cloud computing

Though traditional SCM platforms take a more siloed and transactional approach to the entire fulfillment lifecycle, this method no longer works in an omnichannel, hyperconnected world. The rise of e-commerce and mobility has made it necessary for retailers to have greater visibility into the entire supply chain so they can make last-minute changes in a rapidly changing landscape.

Although many retailers are reluctant to move to cloud-based SCM systems, there are many benefits to doing so, including the following:

  1. Capital and operational expenditure
    As with any cloud-based service, businesses aren’t required to purchase the hardware or IT management infrastructure to support the supply chain. By moving the entire SCM to the cloud, businesses can also cut down on operational costs by not having to manage disparate and interdependent systems in-house in the siloed and inefficient fashion of yesteryear.
  2. Scalability
    As demand fluctuates — particularly around the holiday season — retailers need flexible systems that can scale up or down on demand. If everything is running in the cloud, businesses don’t have to manually tweak existing systems or add new infrastructure to accommodate peak purchasing times. They only have to pay for the resources they actually use.
  3. Efficiency
    With SCM running in the cloud, internal employees no longer need to spend time managing systems and data or fighting fires. Instead, they can focus their efforts on more strategic business objectives, such as competitive analysis and product and sales development.
  4. Inventory visibility
    Because retailers are now tasked with managing the supply chain across multiple channels, they can benefit from a retail cloud computing platform’s improved visibility into what inventory is available, where it is and how to best deliver products in the fastest and most efficient way possible. This platform also gives organizations the flexibility to make changes to orders when they are already in transit.
  5. Systems integration
    Cloud-based SCM systems are designed to seamlessly integrate with existing and interdependent retail systems on the back end, including inventory management, product information management, transportation management, customer relationship management, enterprise resource planning and store fulfillment and returns management, to streamline the entire business process. With a centralized data repository and data analytics, retailers can also determine where improvements can be made or where any bottlenecks are occurring to remediate any issues before they negatively affect the business as a whole.
  6. Accessibility
    With data stored in a central cloud location, employees can get instant access to information they need from anywhere and on any device. For example, if the product a customer wants is not available in the store, sales associates can easily find where the item is available and provide the most efficient and convenient way to fulfill the order.

The cloud has changed the way all businesses operate, and the retail industry is no exception. With the rapid rise in online shopping and customer expectations, retailers must make significant changes to their supply chain systems and processes to accommodate an omnichannel world. It’s becoming increasingly clear that retail cloud computing is the most effective way to remain competitive in today’s fast-paced market. After all, customers have many choices at their fingertips to get what they want, when they want. With the clear visibility and control of the entire supply chain that cloud-based SCM provides, retailers are set to exceed customer expectations.

Written By

Karin Kelley

Independent Analyst & Writer

Karin is an independent industry analyst and writer, with over 10 years experience in information technology. She focuses on cloud infrastructure, hosted applications and services, end user computing and related systems management software and services. She spent nearly eight years…

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