Prior to the industrial revolution, inventory control was all but not existent. Sure, some merchants and shopkeepers would count their stock numbers at the end of each day to determine what had been sold. Or perhaps they wrote down all sales and deducted the transactions from the inventory quantities they presumed they had. Either way, the process was time-consuming and prone to many inaccuracies.
Then along came the punch card system. Tiny holes punched into sheets of paper corresponded with catalogue items and were readable by computers. These were passed to employees in the storeroom, who would present the items to the front counter for the customer.
The system enabled companies to keep track of which products were being ordered, based on the punch cards customers filled out. Managers could then record inventory stock and sales data. However, the process was expensive, slow and unable to keep up with rising business challenges.
The first version of the modern barcode was the next breakthrough in the evolution of inventory control. As technology improved, so did the availability of tools and software applications to help businesses.
Barcodes for inventory control
The development of more advanced computers allowed the barcode to flourish and with the barcode system becoming more efficient and affordable, it was widely adopted. Tracking inventory by hand was replaced with product scanning. However, data input into computers was still done by hand.
Then came Radio Frequency Identification (RFID) that enabled factories and retail stores to use an RFID microchip to transmit information about a product such as type, manufacturer and serial number, to a data collection device. The introduction of RFID technology meant businesses no longer needed to input data by hand because barcode readers could instantly update their databases.
RFID technology was also a game-changer for vendors because constant access to real-time sales data ensured products were adequately available. RFID technology is now a staple, improving inventory control and streamlining entire business operations.
The evolution of inventory control
The new technologies of cloud software systems, drones, robots, autonomous vehicles and augmented and virtual reality are and will continue to transform inventory control in the ensuing years.
Cloud technology is a cost-effective tool that allows updates to be made in real time on a perpetual basis, which provides minimal disruption of normal business operations and the most up-to-date software. Cloud software solutions provide better inventory control in an increasingly complex distribution environment, offering flexibility, reduced risk and reduced capital costs.
Mobile devices, smartphones and tablets are becoming increasingly more evolved. Sales staff use mobile devices in the field to close sales and update customer information, while hospitality staff use tablets to place customer orders which are then automatically relayed to kitchen staff. Retail stores utilise mobile phones equipped with credit card scanning software to speed up the checkout process during busy times.
Unmanned aerial vehicles or drones are being successfully deployed to upgrade warehouse processes using optical sensors to help locate items in the warehouse or to scan RFID at a distance. In bigger warehouses, drone systems are being used to gauge inventory stock levels and transmit inventory data directly to the warehouse management system.
Industry 4.0 means that the ‘Internet of Things’ will exponentially increase the volume of data, providing companies with the information to optimise customer service through increased speed, reliability and efficiency of order fulfilment.
The highly intelligent, transparent and responsive supply chain that Industry 4.0 offers, will continually improve itself. Enabling supply chains to accurately locate, track and measure inventory movements through sensor technology.
With the support of artificial intelligence, big data and advanced predictive analytics, inventory control and warehouse planning can progress to new levels.
The importance of inventory control
Inventory control is an integral part of business operations supporting multiple business objectives and should be integrated into all other functions of the supply chain planning processes, including production scheduling, sales and operations.
The planning system should embrace the complexity of inventory control processes and business goals relative to inventory stock levels, total inventory cost, inventory quality and customer service goals.
As the evolution of inventory control progresses and new technologies continue to develop, they will significantly change the way goods are received, stored and shipped. With enhanced connectivity, entire supply chains will feel the positive impacts on every area of their business.Topics: barcode, inventory control, RFID