Inventory Management System for Perishable Goods via Merchant Network Sharing
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Solution Overview
Problem
Merchants face challenges in managing perishable inventory, often leading to stockouts or waste due to inaccurate sales predictions, as they need to balance maintaining sufficient stock levels without overstocking.
Innovation Solution
A server processing system that receives inventory data from multiple merchant devices and facilitates the transfer of requests for out-of-stock items from one merchant to another located in proximity, allowing for the provision of goods to customers while optimizing stock levels and minimizing waste.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If a merchant maintains high inventory levels to avoid stockouts, then customer satisfaction is improved, but inventory waste increases for perishable goods
Solution Approach 1:
The patent merges inventory resources across multiple merchants by creating a shared inventory network. When one merchant experiences a stockout, the system automatically sources the product from another merchant in the network, combining their inventory pools to ensure customer satisfaction while allowing individual merchants to maintain lower, more efficient stock levels.
Solution Approach 2:
The patent introduces an intermediary system (the inventory management platform) that mediates between merchants and customers. This intermediary automatically matches customer requests with available inventory across the network, enabling seamless fulfillment without requiring individual merchants to overstock, thereby reducing waste while maintaining reliability.
2Loss of substance
If a merchant reduces inventory levels to minimize waste, then inventory waste is reduced, but stockouts increase resulting in lost sales
Solution Approach 1:
The patent combines inventory resources across the merchant network so that reduced individual stock levels do not lead to stockouts. The shared inventory pool ensures that products are available for purchase even when individual merchants have low stock, maintaining sales volume while allowing each merchant to operate with optimized, lower inventory levels.
Solution Approach 2:
The intermediary platform automatically redirects customer orders to merchants with available stock when the primary merchant experiences a stockout. This ensures continuous sales flow without requiring individual merchants to maintain high safety stock levels, thereby maintaining productivity while reducing waste.
3Productivity
If a merchant predicts sales accurately to optimize inventory, then inventory efficiency is improved, but prediction accuracy remains difficult for perishable items
Solution Approach 1:
The patent combines demand signals from multiple merchants and customers to create a more accurate aggregate demand picture. By pooling data across the network, the system achieves better measurement precision for sales predictions than individual merchants could achieve alone, enabling optimized inventory levels while maintaining high fulfillment rates.
Solution Approach 2:
The intermediary platform collects and analyzes sales data across the entire merchant network, providing enhanced predictive capabilities to individual merchants. This intermediary analysis improves measurement precision by leveraging collective data patterns, allowing merchants to optimize their inventory levels with greater accuracy despite the inherent difficulty of predicting perishable item demand.
Data Source
AI summary
Disclosed is a method, server processing system, system and computer readable medium for managing inventory. In one aspect, the method includes, in a server processing system, steps of: receiving, from a plurality of merchant devices including a first and second merchant device associated with a first and second merchant respectively, inventory data and a plurality of merchant locations which are stored in a data store; receiving, from the first merchant device, data indicative of a requested good that is not stocked by the first merchant; determining that the requested good is stocked by a second merchant using the inventory data of one or more merchants that are located within a proximity of the location of the first merchant; and transferring, to the second merchant device, a request to facilitate provision of the requested good to a customer of the first merchant.