The success of a business, big or small, largely depends on how well it can ace its inventory management game. For manufacturing businesses the inventory value chain entails right from the procurement of raw material to the dispatch of the transformed finished goods to various retailers and distributors.
Similarly for retail and e-commerce businesses, the inventory cycle originates from the sourcing of goods from suppliers and manufacturers and distributing it to the final consumer.
Efficient inventory management essentially means optimizing the inventory handling and movement throughout the supply chain. Let’s explore what is inventory management or the definition of inventory management.
What is Inventory Management?
Definition of Inventory management: Inventory management is the practice of managing a company’s stock of goods and materials. It involves tracking an organization's inventory, which includes items such as raw materials, finished products, components, and other related items.
The definition of inventory management is to ensure that a business has the right amount of products on hand at all times so it can meet customer demand without running out or having too much stock on-hand.
This practice also helps businesses streamline their operations by reducing overhead costs associated with maintaining excess inventory. Additionally, inventory management means organizations understand their sales trends and anticipate future needs. By keeping accurate records of their current stock levels, businesses can better plan their purchasing decisions and budget accordingly.
Importance of Inventory Management
Inventory ownership can be both asset and liability for a business depending on how efficiently it is managed. Efficient Planning and rapid inventory turnover can lead to revenue growth while, keeping it too long in the storage can end up slowing down operations, and hinder cash flow.
Inventory management includes overseeing and controlling purchases, storing stock efficiently, checking for expired or damaged products, maintaining accurate stock counts, and more.
Hence, the importance of inventory management is vital for businesses as it helps in identifying trends to keep up with customer demands and prepare for a shortage in stocks.
Key 7 Benefits of Inventory Management
Benefits of Inventory management to businesses are diverse and numerous, including:
• Improved customer service
By having the right amount of inventory on hand at all times, businesses are able to fulfill customer orders quickly and efficiently. This helps to increase customer satisfaction and loyalty.
• Cost savings
By reducing excess inventory, businesses can save money on expenses related to storage and transport. Additionally, they can avoid costly stock-outs that could hurt their bottom line.
• Increased efficiency
Effective inventory management helps organizations streamline their operations by eliminating unnecessary processes and reducing manual labor associated with tracking stock levels.
• Better forecasting
Accurate and up-to-date records of inventory levels help businesses anticipate future needs for products or materials , allowing them to make better purchasing decisions.
• Better Inventory Insights
With inventory management, you can easily track inventory and manage stock control that helps to find sales trends, seasonal trends, growth opportunities, gaps, and other crucial insights.
• Seamless Vendor Relationships
Having an inventory management system in place ensures seamless communication and collaboration with vendors and suppliers to manage the amount of inventory, costs, future orders, etc.
• Organized Warehouse Process
With detailed insights on inventory, cost savings, optimization, and forecasting, businesses can keep their warehouse processes organized and seamless allowing maximum output and productivity.
In conclusion, the benefits of inventory management are endless as it is a critical part of any business’s operations. It helps organizations save money and increase efficiency while providing improved customer service.
6 Biggest Inventory Management Challenges
Here are the biggest inventory management challenges faced by businesses. We have accumulated all the inventory management challenges into 6 core areas.
Inaccurate Inventory Tracking
Most businesses still rely on manual tracking and spreadsheets to get an overview of their inventory and its movement. Manual tracking involves physical cycle count which is time consuming.
Lack of digitization and automation translates to frequent cycle counts that take a lot of time, are prone to errors, and don't provide real-time information about stock availability in the warehouse.
Out of sync inventory data can lead to missed sales opportunities or overstocking. Besides significant manual effort is expended in compiling inventory data in spreadsheets, and communicating those with various stakeholders.
Damage and Wastage Due to Lack of Expiry Insights
According to a landmark study, nearly 40% of the food produced in the United States ends up in the landfill. The same study shows that 21% of US landfills consist of expired food products.
A lot of this comes from warehouses and storage centers where improper methods of storing and dispatching a product are followed. Due to inaccurate information about stock levels, warehouse managers can sometimes end up over-ordering a product.
This causes the supply to exceed demand, and products get stuck on shelves for a long time. Such products end up expiring and become unsafe to use.
Not following standard practices like the First In First Out dispatch method and real-time stock update also leads to older products being on the shelf while newer batches get dispatched. The perishable goods industry usually suffers from this problem.
Suboptimal Placement in the Warehouse
Visibility of stocks inside the warehouse is another major challenge faced by warehouse managers. Associates spend a lot of time moving around, trying to locate a specific item. Erroneous stock placement and management inside the warehouse results in higher retrieval and automated warehouse picking times as well.
Not only does this slow down warehouse processes, but also delays shipments or leads to the dispatch of an incorrect order. This heavily impacts the customer experience, making them distrustful of your services.
Even a slight delay in shipments can be a problem for time-sensitive items like medicines, disaster management equipment, or food products.
Many warehouses, especially the small and medium-sized ones, tend to overstock products. Inefficient inventory management, inability to forecast market demands, ordering products in large quantities are some of the reasons that can lead to overstocking.
Overstocking results in deadstock, which can have a huge monetary impact on the warehouse as every item still on the shelf is a liability and blocks cash flow.
Unsold products also end up taking valuable space, preventing warehouse owners from investing in something new and keeping up with the current market trend.
Inefficient demand planning can lead to a stock-out situation where certain stocks are no longer available in the inventory. Customers wanting to purchase that item would either need to wait for long periods for it to be back in stock or shift to another vendor.
Nearly 34% of businesses have been found to deliver an order late as they unknowingly sold something that wasn't available in their stock. All of this happens due to poor inventory visibility and inefficient reordering of stocks.
Manual Replenishment and Reordering
Manual replenishment and reordering are the key reasons causing overstocking or understocking. Warehouse managers need to continuously monitor the stock level on their own to get an idea about fast moving items and those that are taking up unnecessary space.
This manual oversight creates a logistical bottleneck, is slow and inefficient. Inventory managers need to coordinate with multiple suppliers on different levels to ensure proper flow of inventory.
Errors in record keeping, miscommunication, or delayed inspection can affect the warehouse's ability to fulfill changing customer demands. Since same-day delivery or expedited shipping is a reality these days, which cannot be achieved with reliance on manual operations.
Overall these inventory management challenges can be solved with inventory management systems and techniques.
What is an Inventory Management System?
An inventory management system is a software application that helps businesses manage their stock levels. This type of system automates processes such as ordering, tracking, and accounting for inventory. It also generates reports to give users insight into their business’s inventory status.
Inventory management systems can be used to track a variety of items, from raw materials to finished goods. They can also help businesses with forecasting and budgeting by providing real-time data on stock levels and sales trends. Additionally, these systems often include features that enable users to set reorder points for products and generate alerts when stock is running low.
Inventory Management Software in Modern Warehouse
An inventory management system combines daily processes occurring in a modern warehouse with technologies. Inventory management is an important aspect of supply chain management as it administers the movement of goods from manufacturers to warehouses and then finally to a customer. Inventory management systems improve the visibility of this movement by employing the use of advanced hardware and software.
Modern warehouses use hardware tools like barcode labels and scanners to track the exact movement of every SKU. A barcode contains essential information about the product and makes it easier to capture and store product details across silos of the supply chain.
An inventory management software acts as the central hub for all this information. It also helps in analyzing data to keep an accurate inventory count to prevent over-stocking or under-stocking.
Warehouses can realize a lot of benefits by adopting a robust inventory management system in their business processes. Enhanced visibility and improved inventory management can help in reducing costs, optimize fulfillment operation, prevent theft and product spoilage, enhance customer experience, forecast future market trends and a lot more.
Different Types of Inventory Management Systems
Perpetual inventory system
A perpetual inventory management system is a method of tracking inventory in which stock levels are updated with each sale or purchase. This allows businesses to maintain an accurate record of their current inventory levels at all times, giving them insight into their stock status and allowing them to make data-driven decisions about purchasing and production.
Batch tracking system
A batch tracking system is a type of inventory management system used to track items by group or lot. This type of system helps businesses keep track of products that may have similar characteristics but vary in quality or origin. It also enables users to trace the source and movement of individual items across their supply chain in order to identify any potential issues.
MRP stands for “Materials Requirements Planning” and is a type of inventory management system used to forecast future inventory needs. This system uses data from past sales and current stock levels to generate reports that can help businesses plan ordering and production schedules. Additionally, it can be used to identify potential problems or bottlenecks in the supply chain.
Just-in-time inventory system
A just-in-time inventory system is a method of managing stock levels that focuses on ordering and delivering items only when they are needed. This type of system helps businesses reduce the amount of money tied up in their inventory by ensuring that products are not overstocked or understocked. Additionally, it can help to minimize waste and maximize efficiency by ensuring that the right items are available at the right time.
Periodic inventory system
A periodic inventory system is a method of tracking stock levels that does not update records with every sale or purchase. Instead, businesses track their inventory levels at specific intervals—such as the end of each month or quarter. This type of system can be beneficial for businesses that do not need to keep an accurate count of their inventory at all times, such as those with minimal stock levels and low turnover rates.
Manual inventory system
A manual inventory system is a method of tracking stock levels that does not use any software or automated processes. Instead, businesses record their inventory levels by hand, such as in a ledger or spreadsheet. This type of system can be beneficial for small businesses with limited budgets, as there are no costs associated with purchasing and implementing an inventory management system.
Barcode systems are a type of inventory management system that uses barcodes to track stock levels. This type of system is often used in retail settings, as it allows businesses to quickly and easily record information about products at the point of sale. Additionally, some barcode systems can be integrated with software applications such as customer relationship management (CRM) or enterprise resource planning (ERP) systems.
RFID stands for “Radio Frequency Identification” and is a type of inventory management system that uses radio waves to store and transmit data about products. This type of system is often used in manufacturing and logistics operations, as it enables users to track items across large distances in real time. Additionally, RFID systems can be used to monitor product quality or detect counterfeit products.
How Inventory Management Systems Address Inventory Pain Points
Real-time inventory visibility
With inventory management software, warehouses can improve their inventory visibility across supply chains or in-house. Warehouse managers will have granular SKU level visibility at their fingertips and will be better equipped for taking efficient business decisions. Integration of smart shelves, drones, cameras, and other IoT-enabled devices in the warehouse can provide accurate inventory information in real-time.
Effective inventory tracking will help warehouses to reduce operational costs and cut down on dead stocks. Expired products offer no value to you or the customer, while slow-moving stocks end up costing more money in storage than they would have earned after sales.
Insight about the stock level is also essential for preventing overstocking or understocking scenarios. Managers will have accurate information about depleting SKUs that need to be reordered, products that aren't selling, and products that are in high customer demand.
Being on top of stock levels and market trends will give your business an edge over competitors.
Audit and Compliance
From receiving a shipment to final dispatch, a typical inventory management process contains a lot of moving parts. Inventory audits are an essential component of a well managed business. However, they can be extremely time-consuming, often hindering the compliance process.
Some of the best inventory management software offer superior audit and compliance abilities to your warehouse. They enable real-time inventory tracking and comprehensive SKU audit trail from receipt to dispatch.. They also aid in reducing human intervention, to make audits less time consuming.
Frequent auditing keeps managers aware of their inventory status and helps them comply with different government regulations easily. We enable warehouses to follow best practices like First Expiry First Out (FEFO), First In First Out (FIFO), and Last In First Out (LIFO), PIPO (pallet in Pallet Out) for perishable products and consumables.
Dynamic Inventory Optimization
Manual reordering and replenishment of stocks is a time-consuming and error-prone process. Advanced warehouse softwares enables dynamic Inventory by leveraging AI algorithms to maintain minimum and maximum stock levels dynamically.
The intelligent system will notify warehouse managers if the stock of a certain SKU is going below the threshold level or if it has exceeded the optimal level and shouldn't be ordered further.
Managers will no longer need to move around the warehouse to keep a record of every stock manually. They can instead focus on better planning of inventory replenishment based on customer trends and maximize profitability.
Cargo unloading is the first thing that happens after a shipment is received. It is followed by the arrangement of products on their respective shelves. This is an important step as proper placement of products can save valuable search time for an associate during picking while fulfilling an order. Warehouse inventory management software helps optimize the product placement by using automated machine learning-driven ABC analysis.
The machine learning algorithm will then automatically identify an item according to the criteria it fulfills and suggest the class it fits in. This will eliminate the need for manual classification and the concerned item can then be placed in an optimal location based on the frequency with which it is ordered.
A routing algorithm can also map the shortest way for an employee to retrieve an item, saving valuable time in dock-to-stock and pick-to-ship cycles.
9 Best Inventory Management Techniques
1. Six Sigma
Six Sigma is a set of strategies and tools used to improve processes and maximize efficiency within an organization. It is based on the idea that when data is collected and analyzed, organizations can identify areas for improvement, eliminating defects and reducing waste.
When applied to inventory management, Six Sigma can help businesses create more efficient processes, reduce the amount of inventory needed on hand, and ultimately increase profitability.
The five stages of the Six Sigma process are define, measure, analyze, improve, and control. During each of these stages, organizations can identify opportunities for improvement and develop strategies to increase efficiency.
2. ABC Analysis
ABC analysis is a method of inventory management that categorizes items into three groups based on their value.
Items in group A are the most valuable and need to be closely monitored and managed, while items in group C are the least valuable and require less attention.
This method helps businesses prioritize their inventory management efforts and ensure that their resources are being allocated properly. Additionally, it can help businesses identify areas where they may be able to cut costs and increase efficiency.
3. Just-in-Time (JIT) Inventory Management
Just-in-time inventory management is a method of tracking and managing stock levels that focuses on ordering and delivering items only when they are needed. This type of system helps businesses reduce the amount of money tied up in their inventory by ensuring that products are not overstocked or understocked.
Additionally, it can help businesses save time and money on inventory management by reducing the amount of administrative work associated with tracking stock levels.
4. FIFO (First In First Out)
FIFO is a cost flow assumption that assumes that the first items to enter inventory are also the first ones to be sold or used. This technique is most often used when products are seasonal or have a short shelf life.
It is advantageous in cases where the cost of goods is increasing, as it allows businesses to recognize the highest cost items first. However, it can be disadvantageous if the costs of goods are decreasing, as lower-cost items will be recognized last.
5. LIFO (Last In First Out)
LIFO is one of the popular inventory management techniques that assumes that the most recently purchased or produced items are sold or used first. This technique is advantageous when costs of goods are decreasing.
It will allow businesses to recognize the lowest cost items first. However, it can be disadvantageous in cases where costs of goods are increasing, as higher-cost items will be recognized last.
6. Demand Forecasting
In order to effectively manage inventories, businesses must accurately forecast demand for their products. There are several different inventory management techniques available for forecasting demand, including trend analysis, seasonal indexing, and regression analysis. Trend analysis involves analyzing historical data to identify patterns in a product’s sales over time.
Seasonal indexing involves examining past sales of similar products during the same period of the year to make predictions about future demand. Regression analysis uses mathematical models to identify relationships between different variables and predict future demand.
7. Economic Order Quantity Model
The economic order quantity (EOQ) model is a mathematical formula used to determine the optimal order size for inventory, based on costs associated with ordering and holding inventory.
The EOQ inventory model considers factors such as ordering costs, carrying costs, and lead times when determining the optimal order size. This inventory management technique is useful for businesses that are looking to minimize their inventory costs while still ensuring they have sufficient inventory on hand to meet customer demand.
8. Cross Docking
Cross docking is a technique used by businesses to streamline the supply chain process. It involves receiving product from suppliers and immediately transferring it to customers without taking the time to store it in a warehouse.
This inventory management technique is useful for businesses looking to reduce inventory costs, as it eliminates the need for warehousing and associated costs such as storage fees and personnel.
9. Safety Stock Model
The safety stock model is a technique used by businesses to ensure that they have enough inventory on hand to meet customer demand, even in cases of unexpected fluctuations.
A safety stock level is calculated based on the standard deviation of historical data and can be used to provide a buffer between actual and forecasted demand.
These were some of the best inventory management techniques to help you manage your inventory and meet customer demands seamlessly and efficiently.
How Is Inventory Management Different From Other Processes?
Inventory management system is used to plan, organize, and track the movement of products and supplies within a business. It involves tracking the levels of available items in order to ensure that production and sales are running smoothly.
Unlike other processes, inventory management focuses on managing both tangible and intangible goods. This includes tracking raw materials, components, finished products, as well as services related to production or sales. Additionally, it involves monitoring supplier relationships and more.
Inventory Management vs. Inventory Control
Inventory management and inventory control are two related but distinct processes used to manage the flow of products and supplies within an organization. Inventory management is focused on optimizing the supply chain, while inventory control is focused on tracking the movement of goods and ensuring that stock levels remain accurate.
Inventory management involves activities such as planning and forecasting future demand, managing supplier relationships, improving production processes, and maintaining accurate records. On the other hand, inventory control deals with more specific processes like tracking raw materials or finished goods, setting reorder points, and maintaining par levels. Additionally, inventory control focuses on monitoring stock levels in order to minimize waste or shortages due to fluctuations in demand.
Inventory Management vs. Inventory Optimization
Inventory management and inventory optimization are also two related but distinct processes used to manage the flow of products and supplies within an organization. Inventory management focuses on optimizing the supply chain, while inventory optimization takes it a step further by focusing on maximizing efficiency in order to improve profitability.
Inventory management involves activities such as planning and forecasting future demand, managing supplier relationships, improving production processes, and maintaining accurate records. On the other hand, inventory optimization involves using data analytics to identify trends in customer demand, setting up efficient stocking policies, and utilizing technology solutions such as artificial intelligence or machine learning to automate certain tasks. Additionally, inventory optimization can also include activities such as analyzing pricing strategies or running simulations to test different scenarios in order to maximize profits.
Inventory Management vs. ERP
ERP (Enterprise Resource Planning) is a system used to manage the flow of data and resources within an organization. It helps businesses consolidate their operations such as finance, human resources, and inventory management into one comprehensive system. ERP systems offer companies the ability to access real-time data, streamline processes, and automate tedious tasks.
Inventory management is the process of tracking and managing the levels of available items in order to ensure that production and sales are running smoothly. This involves activities such as planning and forecasting future demand, managing supplier relationships, improving production processes, and maintaining accurate records. On the other hand, ERP systems focus on automating processes across multiple departments
Inventory Management vs. Order Management
Inventory management and order management are two related but distinct processes used to manage the flow of products and supplies within an organization. Inventory management focuses on optimizing the supply chain, while order management deals with more specific processes like tracking orders and ensuring that customer requests are fulfilled in a timely manner.
Inventory management involves activities such as planning and forecasting future demand, managing supplier relationships, improving production processes, and maintaining accurate records. On the other hand, order management deals with more specific processes like tracking customer orders, setting up fulfillment systems, keeping track of inventory levels, and ensuring that orders are processed efficiently. Additionally, order management also involves activities such as managing payment processing systems or providing customer support.
Inventory Management vs Logistics Management
Many people believe that they are one and the same, but this is not true. While there are similarities between them, they serve different purposes and have different goals.
Inventory Management focuses on managing the stock of items available for sale at any given moment. This includes keeping track of what items are in stock, when they will be used, how to replenish them, and which items should be removed from inventory due to age or lack of demand. It also involves managing the flow of inventory from suppliers to customers.
Logistics Management, on the other hand, focuses on managing the physical movement of goods and services from one place to another.
This includes planning and controlling all aspects of the supply chain process such as transportation, warehousing, packaging, and order fulfillment. It also involves optimizing the efficiency of a business's logistics operations in order to reduce costs and improve customer service.
Inventory Management vs Warehouse Management
Inventory management is focused on managing the movement of goods within a business’s system, while warehouse management is focused on managing the storage and organization of goods in the company’s physical warehouse.
Inventory management includes activities such as tracking sales orders, ensuring product availability, forecasting demand and purchasing additional inventory when needed. It also involves tracking raw materials used in production, monitoring levels of finished products and adjusting inventory levels accordingly. The main goal of inventory management is to ensure that the company has enough inventory of the right items at the right times.
Warehouse management, on the other hand, is focused on ensuring efficient storage and organization of goods in the physical warehouse. It includes activities such as organizing stock for easy access, labeling items for identification, and tracking the location of each item. The main features of the warehouse management system is to ensure that goods can be retrieved quickly and accurately when needed.
How To Manage Inventory Effectively & Efficiently
Here are some of the key inventory management methods and ways that can help you streamline your inventory management.
1. Product Category Demand Analysis
The initial process in seamless inventory management is to understand your business’ product category and its demand trends. Having knowledge of the products’ demand trends will help you handle inventory better.
You can study demand fluctuations, seasonal trends, or competitor data if you are starting new and if you have your existing past data then you can conduct demand analysis to see when you require what amount of inventory.
2. Set Par Levels
Setting par levels is an important part of effective inventory management as it helps businesses remain cost-efficient and ensure accurate stock control. Par levels are predetermined minimum and maximum quantities of a product that should be kept in stock at all times, based on the rate at which they are used.
By setting these levels, businesses can reduce the risk of overstocking or understocking items, and optimize their ordering processes by knowing when to place orders for new products.
3. Inventory Storage
Inventory storage includes two aspects: whether you are storing inventory internally in your own ecommerce warehouse or whether you are storing externally with fulfillment centers or 3PL warehouses.
If you are storing internally then you will need to have an inventory management system or software to help you manage your inventory and if you are storing externally then you will need to sync your inventory management system with their tools and softwares.
4. Inventory Tracking
Irrespective of internal storage or outsourced storage, you will need to track the inventory data such as stock keeping units (SKUs), Quantities on hand, orders shipped, avg. order value, high performing products, storage location, and many more.
Tracking the inventory data will streamline your inventory management process and make it hassle-free for all the parties involved. This way the products can move easily from end-to-end with maximum efficiency.
5. Inventory Receiving
It is imperative that stock check-in procedures are accurate to avoid errors that can negatively impact product quantity on hand (QOH) data at warehouse receiving process. Such errors can result in over-ordering, false backorders, and unsold stock, which can all have a detrimental effect on your bottom line.
To ensure accuracy, it is recommended that you receive stock against your purchase order and open and check all cases and containers for correctness. Relying solely on box labels and supplier packing slips can lead to mistakes, as their staff may also make errors.
The prompt and accurate receipt of inventory shipments is a crucial aspect of effective inventory management.
5. Timely Audit of Inventory
Despite the use of reliable inventory management software, it is still necessary to physically count inventory periodically to ensure accuracy. Businesses employ various techniques, such as a comprehensive year-end physical inventory that accounts for all items and ongoing spot-checking, particularly for fast-moving or difficult-to-stock products.
- Cycle Counts: Cycle counting is a type of inventory management system that utilizes scheduled counts of products in order to ensure accuracy. This type of system can help businesses save time and money by eliminating manual processes such as counting items or entering data into spreadsheets.
6. Leverage Inventory Management Software
This is a no-brainer. Inventory management software is the cornerstone of managing inventory successfully and effectively. Inventory management software includes consistent or real-time inventory tracking, products information, low stock updates, etc.
Moreover, features like purchase management, supplier management, inventory reporting, data security, advanced analytics, and customer support can help in managing inventory easily and efficiently.
7. Invest in Technology and Automation
Along with the inventory management software, you can also integrate other inventory and smart warehousing technologies and automation tools to make the management process more automated and digitized.
Technologies and automation tools like RFID, Barcode system, warehouse management system, automated guided vehicles, robotics, and AI tech can enable seamless in and out flow of products from the warehouse.
8. Implement Consistent Data Analysis
Data analysis is an important component of effective inventory management as it helps businesses identify areas for improvement and develop strategies to increase efficiency. By analyzing data, organizations can determine the most efficient ways to order and manage products, ensuring that resources are allocated properly.
Additionally, data analysis can help businesses identify patterns in their inventory levels, allowing them to predict future needs and make informed decisions about ordering and stocking items.
These are some of the key ways to manage inventory effectively. Additionally, there are other possible ways in each step of the process be it receiving, storing, or shipping where you can implement systems and methods to optimize inventory management process further.
How to Choose an Inventory Management Software?
When it comes to choosing an inventory management system, there are several factors that need to be taken into consideration.
The first step is to identify the specific needs of your business and how you plan on using the system. Do you require a more complex solution or are basic features enough?
Moving ahead, once you have identified the need, you can look for the following aspects to choose an inventory management software:
You must first explore the complete list of features that every inventory management software has to offer for your business. You can list down the key features that are non-negotiable or must-haves followed by highlight features and then if possible some add-on features.
You can define the feature requirements based on your business needs like do you want a system for material handling or are you looking for management in shipping orders or do you have a huge amount of wholesale orders?
Integrations of an inventory management system means synchronization and collaboration with ecommerce marketplaces, 3PL, point of sale, shipping, etc.
Integrations with these platforms enables the inventory management software to manage end-to-end fulfillment aspects through one place with no extra hassle and dependencies. ‘
3. Ease of Use
As we earlier mentioned about features and integration functionalities, these can lead to an inventory management software becoming more complex and technically-advanced leading to problems in use.
Therefore, you should aim to look for an inventory management software that brings all the required features and functionalities under one roof with seamless navigation and implementation for the ease of use.
4. Software Cost
The first thing to compare here is to take an avg. inventory management software cost and compare it with the costs that you are incurring without the inventory management software. If this cost is equal or less than current costs then you should definitely get an inventory management software.
Moreover, you can compare different inventory management software in the market to see the best value offer based on your feature requirements and purpose.
5. Innovation and Scalability
Just because you are shipping, selling, or managing X amount of products today doesn’t mean that you should look for an inventory management software that can fulfill today’s needs.
You should take into consideration the scalability and growth of your business. If an inventory management software is scalable and innovative then it will adjust seamlessly as your business grows then you won’t face any challenges in the future.
Since we are using software, needing support is a general thought. You might need support for product use, issues, and other assistance as you implement the software into your business.
Therefore, the inventory management software should have both human and digital support resources which can provide assistance as and when required throughout the day and year.
Finally, research different providers and compare their services in order to find the one that best meets your needs.
Additionally, inventory management software can enable companies to better plan for future demand by providing accurate forecasting data. Furthermore, they can also help companies streamline their operations by integrating with other business processes such as accounting or supply chain management.
Hopstack: The Best Inventory Management System for your business
Hopstack's cloud-based digital warehouse software automates and digitizes your warehouse by easily integrating with robots, ERP, and WMS.
Here are the main features of our inventory management software.
- Optimal Space Planning and Picker Routing
- Multiple Accounting and Billing Tools Integration
- Invoice Creation and Management
- Advanced Picking with Route Optimization
- Warehouse Layout Optimization
- KPIs and Daily Performance Tracking
- Predictive Analytics and Productivity Report
- Material Handling, Cycle Counting, and Quality Control
- Automated Inventory Update and Management
- Distributed Order Management and Fulfillment
- Order Batching, Picking, Packing, and Sorting
- Label Verification and Generation
- Multi-Warehouse and Workflow Management
- Marketplace, Carrier, and Vendor Management
- 24/7 Expert Customer Support
From reducing software deployment time, increasing efficiency of existing resources, to increasing warehouse throughput, Hopstack not only reduces onboarding, training, and payroll costs but makes your inventory smarter.
Future of Inventory Management
The future of inventory management looks to be highly optimistic. With the help of technology, inventory control will become more automated and efficient. Companies will be able to utilize data analytics, artificial intelligence, and machine learning to identify customer trends and optimize stocking policies.
Additionally, new technologies such as blockchain and the Internet of Things will allow for real-time updates on inventory levels, allowing for improved inventory accuracy and better decision making. The future of inventory management is sure to include automation, improved accuracy, and greater efficiency that in turn helps organizations increase their profits while providing a better customer experience.