Customers expect a precise delivery date to be declared to proceed with a purchase both when shopping online and in-store. Ambiguity just won’t cut it for today’s buyer. The fantastic news is that the home furnishings industry has a leading solution that delivers these exact capabilities with real-time precision.
STORIS ERP enables industry retailers to compete with major online players and win over customers simultaneously. By leveraging the golden standard for Available to Promise (ATP) and Available to Customer (ATC) calculations, retailers can communicate precise and achievable fulfillment expectations across in-store, mobile, and eCommerce experiences.
Baymard Institute conducted an in-depth study on this topic in the context of eCommerce websites. “By calculating the anticipated delivery date, sites can remove a sizable burden from users.” Baymard’s research exemplified how ambiguity is a source of friction for guests that can reduce online conversions. Additionally, a lack of accuracy on delivery dates and the resulting broken promise hurts the brand post-purchase. It’s about providing a date to close the sale and being able to reliably achieve it.
Available to Promise (ATP) and Available to Customer (ATC) calculations are high-demand features in Point of Sale and eCommerce platforms. These calculations automatically tabulate precise and achievable fulfillment dates for your customer’s orders.
With glaring reasons to adopt ATP and ATC, many retailers have yet to do so. One of the reasons reported by retailers is a lack of clarity on how these calculations work. We get it! You have to trust what’s happening behind the scenes to adopt solutions. That’s why we’ve written this guide to break down these powerful calculations so you can confidently adopt ATP and ATC as crucial parts of your customer experience.
Let’s start with the difference between
Available to Promise and Available to Customer.
Available to Promise
Available to Promise is Step 1. This is when the merchandise for a customer’s order is ready to leave your warehouse. If you have a product in stock, this may be today! If not, this date will be backed into using supply chain data. This is likely the case for special orders and out-of-stock items.
Available to Customer
Available to Customer is Step 2. This is the date the order can be fulfilled, a.k.a. signed, sealed, and delivered to the customer. Merchandise may be in your warehouse (indicated by ATP). Still, your delivery trucks must also have schedule availability and route capacity to meet the last-mile part of the date.
It is possible to receive an ATP date that’s today’s date. This result means you have an available quantity for the guest right now. It’s also likely you’ll see a date in the future. This date reflects when you can expect to receive products from sources such as an incoming purchase order, transfer, or an estimation of when you can get this product from the vendor.
Next, we’ll break down how your
inventory management solutions auto-calculate these dates based on your inventory and supply chain data to demystify how ATP and ATC are calculated.
These factors are essential to a precise calculation.
Available Stock: This metric is unique to your quantity on hand. Available stock ensures you don’t commit to selling the same piece to multiple guests—that wouldn’t be well received by either party! For example, you may have ten pieces in your warehouse, but eight are already reserved for other orders, so only two are available to sell.
Transfers: Does your operation allow you to sell merchandise from various distribution centers? If transferring an item from an alternate stock location will help you fulfill an order faster, ATP calculations can factor in the number of days it takes to move the merchandise between your internal DCs.
Incoming Purchase Orders: This calculation will account for available merchandise quantities coming in on confirmed POs. If merchandise on this Purchase Order is already allocated for another customer, ATP will know.
Warehouse Receiving Days: Your distribution centers may only have certain days of the week when they can receive merchandise. Ensure this is accounted for in your calculation.
New Purchase Orders: You can also use estimations if you don’t have any other sources of stock and need to generate a purchase order for this specific sale.
Vendor Lead Times: If you haven’t confirmed a date to receive your purchase order yet, use the average number of days it takes a vendor to procure goods for your calculation. While precise dates are best, this is a solid alternative if that is not an option.
Pad Days: These are wise considerations if you have a vendor who is not always reliable in delivering purchase orders. Cushioning the date allows you to provide a date you can realistically achieve.
Delivery Schedules: For the ATC component of the calculation, reference your routing calendars by the customer’s zip code to know when you deliver to their neighborhood.
Route Capacities: Also, for ATC, consider your trucking limitations by using capacity settings that ensure your team has an open time slot and room on their truck for the order.
Let’s visualize this complex math behind ATP and ATC with a realistic example.
You have a popular loveseat that sold out over Black Friday.
Replenishment kicked in, and a new Purchase Order was promptly placed.
- A dozen are arriving in your warehouse on 12/4.
- On 12/2, a customer came into your store to purchase this loveseat.
- Six from the new PO are already fulfilling Black Friday backorders, leaving plenty for this customer.
- They live in a zip code you only deliver to on the weekend.
- While your warehouse is currently out of stock on this piece, you will receive the order on 12/4, a Monday. However, Black Friday was a huge success, and your routes to that area are fully reserved.
- But your savvy associate already knew that and didn’t over-promise and under-deliver. They let the customer know they can reserve a delivery slot for Saturday, 12/16, during the 2- 4 PM timeslot. That’s just in time for the holidays. A happy customer goes ahead and commits to the order.
Did your associate know all of this off the top of their head? Of course not!
But your technology is set up to make them look like an all-star. Now, your team can meet precise expectations and satisfy a happy customer.
This is the goal.
Another factor to consider is orders with multiple items. ATC works at the order level and can ensure the entire order is ready for delivery when calculating a date. This is important to save delivery costs and improve efficiency. Retailers can work with guests on split fulfillment if that is more advantageous to securing the order.
With a Mobile POS, your associates can instantly provide customers with accurate order availability dates from anywhere in your showroom. If a date is too far out for a customer, they can easily redirect them to alternatives using product data to save the sale.
Associates can also view the ATP quantity if you are a volume retail operation. For example, if you sell chairs, you’ll want to know if you have a complete set of 6 available on the given date. As dates can dynamically change based on other sales across your organization. This extra tidbit of information can prove tremendously valuable.
Why should you consider adopting ATP/ATC into your strategy?
- Take the guesswork out of when products will be available and provide guests with accurate availability dates at the point of sale and eCommerce website to enhance their shopping experience.
- Decrease broken promises by ensuring delivery and pickup dates align with product availability and fulfillment capacities.
“60.7% of customers are more likely to purchase if they saw delivery times in the cart, and 98% of shoppers stated that’s the kind of transparency that builds trust.”
Project44
Looking to accelerate your use of technology? STORIS uses ATP and ATC calculations across all customer touchpoints to provide an exceptional fulfillment experience and build brand trust.
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