June 22, 2006, 12:00 AM

Merchants strive to overcome gap in web-based order management, study says

Multi-channel retailers expect to see significant improvements in order management capabilities through the implementation of web-based order management software, reducing out-of-stock rates by 25%, AMR Research says in a new study.

Multi-channel retailers expect to see significant improvements in order management capabilities through the implementation of web-based order management software, reducing out-of-stock rates by 25%, AMR Research Inc. says in a new study.

“More retailers are recognizing the need to create a persistent shopping experience across all customer touch points,” says Rob Garf, retail industry research director at AMR Research.

The out-of-stock rate was cited by the largest group of study respondents, 22%, as the most important metric in gauging their success in handling multi-channel order fulfillment, and retailers said that implementing a web-based multi-channel order fulfillment system would improve their out-of-stock rate by 25% within the first 12 months. The study was conducted last month of 51 retailers ranging in size from $500 million to over $10 billion a year in revenue.

But the study, “Technology Trends in Inventory and Order Management for Retailers and CP Manufacturers,” also refers to a “significant gap” between the level of importance retailers place on the business issues impacted by multi-channel inventory and order management systems and their level of current performance in these areas.

While 62% of the retailers surveyed in the study cited “creating seamless multi-channel experience” as a highly important business issue, for example, only 28% said they were currently providing such performance through an integrated inventory management system. A similar but slightly smaller gap existed in the deployment of integrated order management systems for creating a seamless multi-channel experience.

The study also found, however, that while less than a third of retailers had already deployed web-based multi-channel order management systems, more than half will have them deployed within the next 12 months, according their current plans. The study found similar usage and growth patterns for inventory management systems.

 

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