What is Retail Management System? 8 Core Features in 2024

Retail management system (RMS) is a must even for small businesses? Is it true?

Retail eCommerce sales are growing fast and will reach $6.3 trillion in 2024, following an increase of 9.4% in 2023. That’s a lot of money that every serious entrepreneur wants a piece of!

All businesses, whether they have a physical store or operate online, are investing in effective retail management solutions. They know that being able to sell online and offline products smoothly has become a key strategy to win at retail.

But how do you choose the best retail management system to compete with other businesses? And how it can help your retail businesses succeed in 2024? To save you the trouble, our team will explain why retail management software is necessary and highlight eight features you should look for in RMS in 2024.

But first, let’s clear the basics.

What is Retail Management System?

Retailing management includes frontend and backend tasks to help retail stores operate smoothly and save time for managers and staff. A retail management system (RMS) is a platform that comprises a set of solutions to ensure smooth business processes.
It’s like the brain behind your retail store.

It helps merchants organize, track, and control various aspects of their business, such as:

• Keep track of your products in real time
• Process and complete orders from different sources
• Accept payments from customers using various methods
• Deliver your products to your customers
• Store and use customer information
• Improve your customer service and loyalty
• Manage your online presence
• Create and run marketing campaigns
• Generate financial reports & charts and comply with tax regulations
• etc.

All these elements converge in retail process management to help merchants gain insights into their business and make informed decisions about promotions, pricing, and product assortment. Ultimately, the goal is to provide a superior shopping experience for customers.

In the old days before computers took over, businesses had to handle these tasks manually. They’d jot down sales in big books, mail order slips, and use punch clocks for staff schedules. Needless to say, it was a real headache for every business owner.

But now, retail management system has swooped in to rescue us from all that manual chaos. You can find retail shop management software that streamlines things, reduces human mistakes, makes your store run smoother, and, most importantly, helps your business generate more sales.

And don’t worry, this software for retail stores is not picky about the device they run on—whether it’s a tablet, smartphone, or a good old computer—they fulfill your needs.

Why Retail Management System is Important?

Retail software is so important for omnichannel retailers. Well, think of it like choosing between driving a car and riding a horse. A car is faster, easier, and more comfortable, just like retail software can help you manage your business efficiently, save time, and satisfy your customers.

Looking ahead, retail store software will play a crucial role in fine-tuning essential functions for each operation. This type of software taps into artificial intelligence, machine learning, analytics, and big data to automate and optimize all aspects of retail operations from start to finish.

If you don’t take our word for it, observe these key benefits of retail management systems for various audiences in the retail business:

1. For Retail Owners

When retail owners incorporate a practical retail management system, they gain access to precise and timely data about their products, customers, and competitors. This capability proves invaluable, enabling them to respond to their customers’ ever-changing demands and preferences adeptly.

2. For Retail Managers

Are you a retail manager feeling overwhelmed with organizing your staff schedule? Worry no more when you link up with the right retail management system RMS. You get a real-time snapshot of what your staff is up to now and a forecast for the next week, month, and beyond.

Besides, retail management software keeps tabs on daily transactions to help you make sense of your traffic patterns by checking out the graphs. You’ll get what we mean if you’ve ever had too few folks during the hectic times and too many during the slow ones.

3. For Marketing Teams

These retail management systems give helpful information about how customers behave and what’s popular in the market, all from their interactions in the store. When this info is shared with the marketing folks, it helps them create campaigns that really connect with the people they’re aiming for and make the most significant impact.

4. For Vendors

Retailers can enhance their connection with vendors using a retail management system. This system gives them on-time and precise details about orders, deliveries, and payments.

Likewise, retail shop management software enables vendors to supervise and handle inventory and react to demand and feedback from retailers and customers.

5. For Staff

According to McKinsey, 32% of businesses attribute supply chain issues to inventory problems, like inaccurate forecasting and unpredictable demand.

The root of this problem lies in the absence of a comprehensive retail warehouse management system that integrates product management and visual merchandising in stores. These systems enable your staff to oversee inventory in large warehouses or multiple locations.

6. For Customers

Although promotions and offers can make customers feel special, personalization is the secret to a great experience. Understanding customers through their past purchases and interests through retail management process is a way for retailers to build loyalty.

We did not exaggerate this story, as 63% of customers expect retail businesses to understand their specific needs, such as product availability, fair pricing, convenience, promotions, and timely fulfillment. Once again, if these needs are not met, customers may feel unsatisfied and not return.

What Features of Retail Management System Should You Look for?

1. Point of Sale (POS)

• Manage the checkout process
• Record sales transactions
• Calculate the total amount customers need to pay

This is another vital part of the retail store software. Using a point of sale makes transactions between you and your customers easy, even gathering customer data. It does the basics, like adding up sales and making receipts.

When you connect POS and in-store sales with a retail management system, everything happens in one place. This makes it way quicker to access and understand all your transactions.

Some advanced systems, like Magestore POS, can do more. They manage inventory, track shopping behavior, and store customer info (like emails and phone numbers) for later personalized deals and discounts.

2. Inventory Management

• Keep track of what’s in stock
• Alert when it’s time to reorder products
• Avoid overstocking or running out of popular items

In 2024 and beyond, having an advanced inventory management system for retail is essential for your business’s survival. The best retail management solution keeps all information in one spot and updates it whenever something changes, such as sales or returns. For example, if a customer buys a product online, the retail management app will deduct it from the inventory and update the stock level.

Barcodes and RFID tags help the staff find things fast, and the system can make lists for picking and labels for shipping.

You also get a heads-up when you are running low on stock, and you can set rules for ordering more automatically.

You see, retail inventory management systems provide frontline staff with a clear and accurate view of inventory. This helps them make suggestions that enhance customer experiences and boost revenues through upselling and cross-selling.

3. Customer Relationship Management (CRM)

• Store information about customers
• Help in creating personalized shopping experiences
• Manage loyalty programs and promotions

A built-in CRM in shop management system makes it easy to use customer information for various tasks, like boosting your marketing and providing flexible payments for better customer support. This tool helps you build connections, track how much customers contribute to your business over time, and find ways to keep them coming back while bringing in new ones.

Once you understand your customers better, you can use segmentation to personalize services. With quick access to customer details, all staff members can take the initiative and handle any issues efficiently.

Furthermore, merchants can record and check customer feedback. Many sales reps, about 81%, think it’s crucial to see a connected view of data throughout the entire customer journey.

4. Omnichannel eCommerce (aka Multi-Channel Support)

• Offer valuable insights into customer behavior, sales trends, and channel performance
• Integrate with the physical store and other sales channels
• Create a unified view of each customer by collecting and analyzing data from all touchpoints
• Provide a seamless shopping experience across different devices and platforms

In retail, a good shopping experience happens when customers can smoothly switch between different ways of buying things. Let’s say a customer is at a store trying on clothes but can’t find the right size. They can use their phone to put the item in their online cart. Later, at home, they can use their laptop to check the item in the cart and buy it.

Studies show that people who shop using different channels, like in-store and online, spend more money than those who only shop in one way. In fact, they spend 4% more in-store and 10% more online. Undoubtedly, it does make sense to seek out an RMS that already incorporates omnichannel eCommerce support.

5. Real-time Reporting and Analytics

• Provide insights into sales trends
• Help in making informed decisions about products and promotions
• Assist in planning for peak shopping times

Your chosen retail management system should have analytics and reporting features to tell you how well your store is doing. For example, you can get reports that help you know when to order more products. Some reports show which products are selling the most and the least.

Also, the system helps with figuring out when your store is busiest. This way, you can rest assured you have enough staff during those times. And about your vendors, you can also track how much you pay them and shipping companies.

Furthermore, listening to your customers can help you fix problems before they become significant. These features make your job smoother and help your store run better.

6. Financial Management

• Manage the store’s income and expenses
• Record and track cash flow and transactions
• Generate financial reports and statements

Running a retail business involves handling lots of records and money matters. You’ve got stock to manage, keep track of your employees, monitor profits and losses, record sales, and deal with annual reports – the list goes on.

That’s why a retail management app that integrates with financial reporting is an excellent way to manage store sales. It saves you a ton of time and helps you efficiently and accurately manage all aspects of your retail business.

7. Employee and Vendor Management

• Keep track of work schedules
• Manage payroll and employee performance
• Control access to different parts of the system

When you have a store management system, it helps you handle your employees and vendors in a better way. Your employees, for example, can check their job duties and schedules on the retail management system when they log in.

At the same time, vendors can see how much inventory is left and order more products if needed. This makes your workforce more productive and accountable.

8. Integration with 3rd-Party Systems

• Connect retail management software with other systems and services
• Enable data exchange and sync between different systems
• Enhance the functionality and efficiency of the retail management system

A retail store management system combines your retail tools in one place, but that’s not all it needs to do. It should also work smoothly with your other business systems.

This means sharing data with your accounting and marketing apps and coordinating with shipping and 3PL partners. Being able to add integrations to your tech stack can make things more efficient, helping you grow without spending too much.

How to Choose the Best Retail Management System in 2024?

When picking a retail management system RMS, the choices out there can be overwhelming. Only some options match your business needs and budget perfectly, so it’s great to think about your business size, type, goals, and challenges.

One way to determine the suitable retail control systems is to check out online resources like G2 or Capterra for comparisons and reviews. However, to know what features you need for your business, understanding the detailed features and integration capabilities of each retail management software is important.

Now, let’s make it even simpler with three recommendations based on features, benefits, and what people are saying:

• First up, merchants can go for the Magestore retail management system to handle everything in one place — from POS and loyalty programs to inventory, purchasing, and reporting. It saves you time, cuts costs, and makes your business smoother for customers.
• Magestore POS system is designed with robust integration capabilities. This allows for smooth integration with various marketing tools, ERP, CRM, and shipment platforms.

• Next, for those managing multiple channels, there’s Dynamics 365 by Microsoft. It’s an intelligent retail management system that combines CRM and ERP in one spot. Remember, though, that Dynamics 365 might cost more than other options and need some extra tweaking to fit your needs.
• Last but not least, LS Retail could be your ideal option if you’re a small or medium-sized retailer. It’s a simple, easy-to-use store management system with basic features for stores, restaurants, hotels, and gas stations. This retail system is perfect for simpler needs but might not be the best fit for big or multichannel retailers with more complex requirements.

We hope this article has helped you narrow down your options and find the best retail management system for your business in 2024.

If you need help or have questions, please contact Meetanshi, a leading provider of Magento extensions and services.

Thank you for reading!