Inventory management may be a term you have heard thrown around business journals, although you may have never had a good understanding of how to achieve it. Inventory management is basically just that, managing inventory and ensuring that the balance of inventory coming in to inventory being manufactured and shipped out is as close as possible. It often takes many hours of scrutiny and assessment of inventory data to determine the optimum ordering volumes to manufacture product as and when required.
This may sound very tedious and indeed it is without the correct software. However, once you have got your ordering and manufacturing under control, the benefits are limitless. For effective inventory management, a software solution is recommended so that data acquisition, analysis and report generation are seamless and accurate.
In our fast-paced world, we are all short of space, time, money and reliability. Inventory management has a positive effect on these universal goals. So, what are you waiting for?
Many business owners experience warehouse frustrations – sometimes, it seems there is inventory everywhere yet production staff are always running short and can never locate every item that appears to be in stock. Inventory management software can help ease these frustrations.
Inventory management promotes a natural decluttering of the warehouse as only the amount of stock forecasted to be needed (plus a calculated buffer of safety stock) is held on site. Therefore, less stock is physically held on site, making it easier to control and store inventory in a logical way, and of course freeing up space that potentially does not need to be leased, potentially resulting in extra cost savings.
Perpetual order fulfilment
It is a big faux pas to risk stock becoming obsolete or expired before being used as this is money down the drain. It is also a faux pas to have a stock-out situation where you cannot fulfil customer orders. When inventory is being properly managed, these situations should be mitigated and customer supply should be consistent and reliable.
When there is less unused stock sitting around without a purpose and only the amount required is purchased, then there will inevitably be capital to use elsewhere. This means the company can take advantage of discounts or investment opportunities which would otherwise be unavailable, resulting in a financial loss on paper.
Of course, with less time spent searching for product amongst the warehouse clutter and with a software solution to make inventory management so much more streamlined and even enjoyable, a significant amount of time will be gained that may have previously been lost. As the mantra goes, time is money, so any time saved is hugely beneficial to the company.
Inventory Management enables future predictions
Inventory management software allow for accurate sales data acquisition and are capable of computing meaningful analyses and reports quickly. This will afford the company a degree of accurate forecasting based on sales trends so that budgeting and predicted orders to your suppliers are possible. This is extremely useful in production planning to try and minimise machine and employee downtime as well as in purchasing planning and investing.
Inventory management is an industry constantly improved through research, knowledge and technology. Adopting software systems and seeking expert help in operating them has revolutionised the way many companies do business resulting in greater flexibility, satisfaction and streamlined production. Improving inventory investment is a sensible investment for any growing company.
Topics: excess stock, inventory management, inventory management software, inventory management system, stock forecasting