Your business operations rely on several types of inventory, including raw materials, work in progress (WIP), and finished products. This inventory is tangible in businesses that deal with physical commodities and intangibles in service companies. Since inventory is an asset your business can't run without, you need to hold as much of it as possible to ensure your customers are taken care of without running low or compromising your cash flow. And holding inventory demands proper management systems.
What Is Inventory Management?
Inventory management covers the entire process of ordering raw materials, warehousing, production, and selling finished products. Its sole purpose is to help your company streamline operations by avoiding problems like shortages and gluts (excessive supply). In the past, businesses kept track of their inventory manually, from restocking to tallying sold products. However, today, cutting-edge enterprises use inventory management software to manage all the tasks mentioned earlier efficiently.
Why Do You Need Inventory Management Software?
Inventory management software offers your company numerous benefits, including:
1. Increased productivity
Inventory management software offers you a solution that is automated, well-organized, and systematic. As a result of using such a system, you get more done in less time. Furthermore, since inventory management software automates the tracking and management of inventory, your team gets more time to focus on meeting your customers' demands.
2. Reduce stockouts
Stockouts happen when your business cannot meet clients' orders due to a rise in demand and inadequate inventory volumes. A safety stock cushions your operations against such events, but it may deplete too in some cases. Once your run out of inventory, chances are high clients will migrate to your competitors, and your sales and profit margins will dwindle. To avoid the effects of stockout, you need inventory management software. This software comes with features like automatic quantity updates, low stock alerts, and real-time inventory valuation. These features ensure you always have enough inventory to meet your customers' demands.
3. Less deadstock and expired inventory
Deadstock hurts your business by tying up capital, affecting revenue, and taking up warehouse spaces you'd otherwise use to store other items. Expired inventory, on the other hand, is simply a costly wastage to your business. Deadstock and expired inventory are a big problem, especially if you deal with perishable commodities. Inventory management software helps you track your orders and inventory to avoid wastage. Plus, it's easy to isolate inventory that sells poorly and those flying off the shelves with such a system. That way, you can adjust your production and fulfill orders on time.
4. Customer satisfaction
Inventory management software helps you make timely fulfillment and avoid running low. Plus, since you'll always have products in stock, you can swap a defective item instantly upon return. Besides, since this software gives you regular updates, you will, in turn, offer customers up-to-date information. All these add up to happy, satisfied customers.
For more info, contact a company that offers services like inventory management software.