The Expert Guide to Retail Allocation and Replenishment

Boost your inventory productivity by understanding allocation and replenishment best practices, common challenges, and innovations.

As retailers must react to the increasingly complex ways consumers want to engage, the focus on inventory productivity continues to intensify. Changes in how fulfillment activities integrate with the supply chain and the downstream impact on customer experience define new considerations for developing and enhancing retail allocation and replenishment strategies.

Allocation and replenishment processes encompass fulfillment activities for many different business models, including traditional retail (vendor to DC, DC to store), direct-to-consumer, wholesale, or combinations of these businesses.

In this expert guide, Parker Avery team members take a deep dive into some of the key components related to retail allocation and replenishment processes. The topics and approaches discussed in this guide are relevant across different business models. Our retail consultants cover the end-to-end retail allocation and replenishment business processes, essential capabilities and best practices required for success, common challenges, as well as innovations that can enable key capabilities.

What are retail allocation and replenishment?

Retail allocation and replenishment are execution steps within the merchandising process that determine the optimal quantities and locations to send inventory to meet anticipated customer demand. These steps can apply to many different relationships within the merchandising process, including vendor to distribution center (DC), DC to DC, or DC to store.

While allocation and replenishment are commonly discussed together, they are distinct processes. To better clarify the nuances related between allocation and replenishment, it is important to understand the fundamentals.