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Most Important Ways in Which Inventory Management Improves Your Business

Here are the most important ways in which Inventory Management can improve your business.

By Isla WrightPublished 5 years ago 5 min read
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Inventory management is the key to success for businesses in the retail and manufacturing industry, as well as for a lot of enterprises in the service and hospitality industries. In fact, there’s probably not a single line of work where an efficient storage system doesn’t play a role in corporate efficiency. Keep in mind, nonetheless, that this is a complex logistical issue whose success greatly depends on your ability to organize your warehouse space and lay down an efficient infrastructure. Presently, this can be done with an efficient tool in the form of a warehouse management software and here are several benefits of using such a practice.

Understanding your current capacities

The first thing that efficient inventory management can help you do is to learn the current capacity of your business. In a scenario where you are asked to supply a certain amount of items, you can check whether or not you have this amount in your inventory. The best thing about this is the fact that it prevents you from making promises you can’t keep. Needless to say, this is the simplest and the most effective way for you to protect your reputation in the present-day business world. Other than this, understanding your current capacities is quite important in the manufacturing industry, due to the fact that it can affect the number of units that you can produce.

Automating the process

The next thing that is important to mention is the fact that you don’t have to do this the traditional way, where you walk around the warehouse counting containers. In fact, there are many tools and platforms specializing here like the industry veteran Carton Cloud. There are many other benefits to this, then just saving time. First of all, the likelihood of human error is drastically reduced. This also leads to greater efficiency, mostly due to the fact that you no longer have to manually repeat various tasks that will be handled by software. Also, you get a lot of reassurance due to the fact that you don’t have to wait for the next audit or depend on outdated information. What you get is feedback in real-time.

Improving your delivery system

One more vital thing you need to bear in mind is the fact that your delivery system starts with your warehouse management. Coincidentally, this is something that your audience cares about the most. What they want to know is when their ordered goods will arrive, as well as how safe it will be in transportation. Needless to say, you need to consider the importance of fleet management system, as well. This, nonetheless, shouldn’t be that big of an issue, due to the fact that the majority of WMS (warehouse management systems) have features like route optimization included in their service. Finally, this system can turn out to be pivotal in your efforts to give your customer service a boost.

Reducing the likelihood of employee theft

The next issue worth addressing is the fact that employee theft is a real risk and that the main reason why it ever happens is due to the fact that a lot of entrepreneurs don’t check their inventory as often. This is due to the fact that the only way to identify it is with regular inventory audits. Problems caused by this go beyond direct loss of assets (the value of the stolen item) but also the miscalculation that may come from the fact that you are 100 percent convinced that you have this item in stock. In other words, just knowing that you do this on a regular basis might be a powerful deterrent, that will prevent a lot of your employees for acting this way.

More accurate predictive analysis

Perhaps the single biggest advantage of a reliable inventory management is the fact that you’ll be able to foretell shortages before they occur and prevent them by ordering the item in question. This avoids downtime in your organization which benefits your brand in more than several ways. Other than this, you need to understand the fact that foretelling demand might be one of the most important factors for your overall customer friendliness. It also gives you a chance to ordering in bulk and allows you to avoid getting an excess stock of an item that you aren’t using that much.

More efficient use of storage

One more factor that you have to consider is the issue of saving employee time. Time is money and the efficiency of your staff will help them do more in less time. An increase in efficiency also increases overall employee satisfaction and morale. Needless to say, it also saves your employees from unnecessary injuries (the fewer hours they spend actively working, the lower the chance of an injury). You can also look at this as a managerial freebie and realize that you can do the same amount of work with a smaller staff. With the introduction of robots into the warehouse industry, this may go to the next level.

Reducing costs

Perhaps the best way to fully review the advantage of using robots in the warehouse management is to consider the issue of the way in which warehouse management helps you save money. Operational efficiency is an obvious method, however, it also allows you to do the same amount of work with fewer employees and have the same storage capacities in a smaller warehouse space. All of this drastically reduces your overhead.

Ideal for multi-location management

One last thing that we have to address is the fact that more and more businesses go with multi-location storage. This is due to the fact that some of them just can’t afford to have a warehouse of their own, which is why they are forced to work with different storage units. Now, while some of you may ask why would someone opt for such a warehouse model, the answer is quite simple— because it’s scalable. With the help of the right warehouse management, you’ll be able to tackle this issue to optimal productivity.

Conclusion

In the end, keep in mind that inventory management allows you to raise the quality of your operations to the next level and achieve a peak in your company’s organization. These two traits alone are more than enough to make this investment of time, effort and resources worth your while.

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About the Creator

Isla Wright

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