Today’s post is courtesy of Unleashed Software, a leading provider of cloud-based inventory management software. We love their software and highly recommend it for any businesses in the manufacturing, wholesale or retail industries.
Inventory management is crucial to any business because ineffective management of inventory which is not converted to a product sale is essentially a financial loss. Managing your inventory effectively can improve several aspects of your business from cost savings and increased customer satisfaction to increased morale of employees.
It is an embarrassing situation when you have to answer a customer order with “We regret to inform you the product is out-of-stock and will be shipped to you at a later date”. At the end of the day, the customer you are serving represents a valuable relationship and needs to be treated as such. Effective inventory management can help to avoid these situations as it should track your receipted raw materials from vendors all the way through the manufacturing process to when a sale is completed. The information about all inventory (be it raw materials inventory, work-in-progress Inventory or finished goods inventory) can be very valuable if collected and understood correctly as it provides a sound basis for purchasing and production decisions.
A SaaS inventory management software package is well worth considering for your business as it is completely cloud-based, can save a great deal of time in setup and operation and is accessible from anywhere. This makes it not only easy to use and transparent but also ensures the company can keep running effectively when key employees are away. Here are a few benefits to consider:
Transparency: In order to make beneficial financial and managerial decisions the most accurate and up-to-date information is needed and this is where transparency comes in. Inventory management software can provide real-time information about raw materials and receipts, inventory currently in production and inventory waiting to be shipped. With this information being easily visible and current, the correct raw materials can be ordered with appropriate time frames for upcoming customer requirements.
Understanding the customers’ needs: Assessing and tracking what customer’s desire in terms of products and services is imperative to understanding the market and making future production decisions. As customers’ needs and wants change, so should the products which in turn will feed all the way back into production and raw inventory ordering and consumption.
Costing product: The true value of resources used to create a product or service can be assessed with ease using inventory management software. The input of raw materials, freight, labour, overheads and currency exchange rates can all be assigned accurate monetary values and therefore the finished product can be appropriately costed. When fluctuations occur in these inputs, readjustments to costed products can be made accurately and efficiently.
No-hassle Stocktake: Wouldn’t that be great? Having a system that keeps track of and integrates every department’s consumption and production in real time will make laborious annual stock takes a thing of the past.
Multi-currency integration: If you are a global importer or exporter where you deal in a variety of currencies then it’s important to consider this feature for inventory management software. All currencies traded in can be converted back to the base currency so that at any point in time accurate reporting can be generated and a meaningful understanding of profits and losses can be gained.
Management of stock across multiple locations: Inventory management systems can allow for accurate tracking and reporting on raw inventory and finished products across multiple company locations. This ensures it is an easy task to monitor stock from afar but also allows for more effective stock management between branches based on customer requirements in those locations. Stock which could not sell in one location could then be sold in another, minimising waste and over-production of the company as a whole.
Smart paperwork: Inventory management software can enable the company to be essentially paperless which can allow for auditable tracking of company information and sales. However when paperwork is required to be generated for customers such as purchase orders, packing slips and invoices, inventory management software can create personalised designs and finishes based on the company’s overall image.
The aim of inventory management software is to create a seamless method of keeping track of all stock in all locations which will certainly ensure efficiency in production, decreased waste and complete fulfilment of customer orders and requirements, leading to increased profit margins and overall health of the company.