The larger your business grows — and the more customers you gain — the harder it can be to manage and maintain your inventory.
Whether you’re a small shop with all of your inventory on site or you’re a large operation with industrial warehouses, keeping track of everything coming in and going out is challenging. That can be even further complicated if you’re still using pen and paper or traditional spreadsheets to manage your inventory.
Efficient inventory management is key to fulfilling customer orders quickly and keeping your operations running smoothly. Inventory management software (IMS) can help you see the big picture, no matter how many individual parts and pieces that includes.
Did you know that on average, about a quarter of SMBs don’t use an inventory tracking system? Of those that do, 15% track it within their accounting software, while another 14% use pen and paper, and 21% are building their inventory lists in a spreadsheet program. Companies that use an IMS report that they experienced an increase in productivity and also gained space within their facilities.
What’s inventory management software?
Inventory management software can help you manage all the moving parts of your inventory system, including integrations with your existing accounting, sales, and operations systems.
Let’s take a look at 5 ways inventory management can help you meet customer demand, keep your employees happy, and improve your overall operational efficiencies:
Material Resource Planning (MRP)
Managing inventory can sometimes feel like that game of cups. You know the one where a person drops a ball under a cup and shuffles it around while you’re left wondering where the ball will end up?
Inventory management without inventory software can be much the same, except it’s more like thousands and thousands of balls and hundreds of thousands of cups. Add that to the number of employees you have, magnified by the volume of locations within your operations, and before you know it, it’s easy to lose track of your most valuable resources.
Inventory management software can help you with Material Resource Planning (MRP).
MRP helps you plan for all of the resources you need for your manufacturing operations, including inventory and related financial issues. MRP will give you insight into the big picture of how much inventory you have and how much you actually need, based on real-time orders and historical analytics. This can minimize excess inventory you have on hand so you can maximize your storage space.
Ensuring you have just the right amount of inventory at the right time — and knowing where that inventory is and how to access it — means you can more efficiently respond to customer orders. Timely, accurate customer order fulfillment means happier — and more likely to return — customers for your business.
MRP can also help you forecast how much inventory you’re going to need in the near future based on your existing product orders and quotes. You can even ensure you’re ordering and getting additional inventory on time, based on those projections.
Inventory management software with MRP can facilitate more efficient planning for your inventory processes and ultimately cut down on waste and unnecessary spending.
If you’re manufacturing a product, keeping a close watch on your supply levels can be as challenging as managing product inventory.
How do you know which products to keep in stock when?
How do you know how much of each supply is needed to manufacture your product to meet consumer demand?
And how complicated are your processes when you need to place a new order for supply re-orders, product returns, and restocking?
Inventory management software can help you track changes within your inventory and supply systems and automatically fulfill a re-order request, like generating or modifying a purchase order in real-time based on your current needs.
Automated inventory analyses and re-order processes can also help decrease human errors that sometimes leave you with too little — or too much — inventory.
You can even use inventory management software to manage re-orders and backorders, too.
Automated cost updates
If you’re ordering a lot of supplies from a number of vendors — especially if multiple people within your organization are responsible for that — it can be easy to miss small prices increases until they’ve added up to big expenses over time.
Inventory management software can give you instant insight into your cost rates, based on your most recent purchase records. You can even set alerts to notify you when your profit margins are dropping below your target levels. That means if your costs start increasing upward, you won’t get caught off guard.
Inventory management software can help you keep track of all of your inventory by monitoring serial or lot numbers. When new inventory comes in or goes out, your team members can use a barcode reader to scan serial or lot numbers, or manually select numbers from a list in your inventory management software solution. This can give you clear insight into a specific lot of products or specific serial numbers at any time.
This inventory tracking feature is particularly helpful for product recalls and product returns.
Sometimes companies just don’t have space for all of the products they sell or it doesn’t make sense financially to keep a specific product in stock at all times. So instead of keeping a specific product or supply on hand, they’ll place an order with a vendor on an as-needed basis.
Managing those one-off orders — and tracking where they are and where they are going — is challenging, especially if you’re doing it manually. Inventory management software can make drop-shipping and special order requests a breeze.
Inventory management software can help you automate those orders and easily facilitate shipping. You can even track when the orders are received, and if they’re coming to your location, do a quality control check before it’s off to your customers.
Insight, forecasts and accountability
Inventory management software, coupled with an Enterprise Resource Planning (ERP) solution, can help you streamline all the processes within your manufacturing and warehouse operations.
From inventory management to automated product selection and shipping, to order management, tracking, and scheduling, you can save time, money, and resources with software that facilitates and enhances your workflow automation.
Are you ready to see how inventory management software can improve your manufacturing and warehouse operations? Save your seat in an upcoming aACE webinar today. We have several planned that tackle everything from managing purchase orders to managing inventory and shipping. You won’t want to miss out.
“We were looking for a solution that gave us a solid core that we could customize rather easily to suit our unique business processes. As a custom fabricator, we also needed a solution that could give us several different options when it came to how we want to manage and track inventory, account for multi-level job-costing, and handle our unique design and estimation processes as well. Since implementation, we have found that aACE has not only helped us reinforce and automate many of our complex workflows, but it has also given us visibility into our data at both a high level and granular level like we have never had before.” – Andrew Porter; ERP Manager, Gable