inventory Archives - Striven

Tag: inventory

Is the Supply Chain Still Hurting?

Posted on by Eleanor Hecks

To keep expenses low and avoid inventory that wouldn’t move, most businesses went to an order on demand type model a decade or more ago. Unfortunately, when the supply chain runs into issues, not having inventory in stock hurts both consumers and businesses. 

During the height of the COVID-19 pandemic, people learned just what could go wrong with a supply chain. The store shelves were barren of toilet paper and everyday supplies. In some areas, the shelves were wiped clean of canned foods and perishable items, leaving people feeling panicked over where they’d get sustenance. 

Where Is the Supply Chain Right Now?

Since, things have improved some but issues still remain in some industries. The issues that caused supply chain issues in late 2019 and early 2020 have not completely gone away. Continued shifts in supply demand and labor shortages impact some sectors, including consumer goods and food. Another issue is structural factors and getting items from point A to point B, with the risk of disruptions at any point along the way. 

Wars in Ukraine and disruptions in other parts of the world might also impact an already weakened supply chain. According to Statista, the global supply chain market will hit around $30 billion by 2026. Many of the services making up that number are to help businesses navigate the new normal in securing materials or products.

While you can’t control pandemics, wars or even labor shortages, there are some things you can do to ensure your business runs smoothly and you have what your customers need when they want it.

1. Control Your Inventory

The first step to avoiding supply chain issues is to know what inventory you have. Invest in an inventory management system that alerts you when you run low on a popular item or need to clear out stock that isn’t moving quickly. 

Look for a program that tracks sales, customer requests and stock for the most benefit possible. You should occasionally run analytics to see if you should up the amount of inventory in a particular area. For popular items, you may be able to integrate with the vendor’s system and submit automatic orders whenever your stock falls below a certain level. 

2. Manage Customer Expectations

If customers expect to walk into your brick-and-mortar store and buy what they need or pop online and get an order in two or three days, you may set them up for disappointment with particularly popular items. 

Figure out how long it takes to receive the product. Are there any delays typically? What promotions are you planning and do they make sense based on how easy or difficult it is to get stock?

 Know what you’re spending on various promotions and marketing efforts. For example, one company allotted around 25% to promotional activities, but the amounts vary depending on what type of product they’re offering.

3. Add Time for Delays

Disruptions in the global economy, government regulations and increased demand in some areas all contribute to supply chain issues and result in delays in receiving products and raw materials. 

Whenever you plan out your ordering time frame, allow a little extra time for unexpected delays. It’s better to overlap inventory and have some still left in stock when new items arrive than to run short and miss out on sales.

Think about what you do when you visit a store and they are out of what you wish to buy. You either go online or you drive to another store until you find what you need. If you fail to serve your loyal customers, you’ll lose them to someone who has what they seek to buy. 

4. DIY Products

What type of products do you sell? Can you make it yourself or add some customization and offer it in a different way?

For example, you might want to invest in a 3D printer and create your own products on-site. Another idea is to invest in a Cricut or other scoring machine and customize items to your patrons’ liking. Cricuts are already changing multiple industries such as education and retail. 

5. Build Relationships With Suppliers

Who are your current suppliers? Take the time to phone them and get to know them on a more personal level. If you don’t have a point of contact for each company, develop one now. You need a human who can handle your concerns and answer questions about delays or estimated delivery times.

Once you have a solid relationship with your current suppliers, seek backup sources. Is there another company offering similar products? Can you place a smaller order and see how it goes? While you don’t want to damage the positive relationship with your current third-party vendors, it’s smart to have another option in your back pocket for those times when your supply chain can’t deliver what you need when you need it. 

6. Watch Demand and Stock Up

Keep an eye on how much of an item moves in case you need to buy sooner than expected. Most inventory management software lets you set alerts. You’ll be notified if something starts to sell faster than expected.

If you notice some seasonal shifts, you might want to stock up on those items before the busy time hits. Look ahead and plan accordingly, and you’ll be less likely to run out of something you need.

Take a Breath and Understand You Can’t Control the Supply Chain

While you can take steps to improve your inventory management and develop relationships with vendors, you can’t control the supply chain. You have no say over if a war erupts near the factory or shipping vessels get held in port. You can’t predict how many other people might buy the same item and drive demand up or down. 

The only thing you can do is pay attention to trends and numbers and adapt as needed. If you can stay on top of your company data, you’ll have a much higher chance of navigating the supply chain successfully.

Inventory Management Software for SMEs: A Guide

Posted on by Matt Bernot

When your SME relies heavily on managing inventory, you want to make sure that your inventory management system is as organized and accurate as possible. To be more specific, you want to keep your inventory management system set up in a way that avoids what some refer to as organizational lag— “the inability to adapt, in lock-step, with the rapidly evolving external environment to remain competitive.” This includes the flow of assorted company data (customer info, receipts, notes, etc.) as well as inventory data. The goal? Keeping all of your employees up to date with the most accurate data possible.

Instead of using scattered sticky notes or scrambled spreadsheets, an inventory management software system designed specifically for the needs of SMEs is the more reliable and versatile solution. Not only does inventory management software keep all of your stock organized, but it can also automate a lot of the order management process while being more cost-efficient and drastically reducing the ability for human error to cause major problems.

Inventory Management: Overseeing Stock and Orders

While keeping track of stock is obviously an important feature of inventory management software, it’s far from the only thing that it can do. In addition to keeping track of stock, inventory management software can create a bill of materials (BOM). It’s important to always be able to see how much material is needed to expand your current stock, to have the ability to update lists when new items are created, and even notify the right employees and vendors when stock is running low. Furthermore, inventory management software can assist with the other main aspect of inventory, order management. 

When sales occur, inventory management software can immediately and automatically place a purchase order to restore the inventory that was just bought. The right inventory management software can also help during the sales process by adding visuals and other informative assets to give customers additional insight and information about the product that they’re buying. When items are sent out for delivery or making their way to you to be stocked and sorted, inventory management software can record all of the important tracking info so you know where your items are and approximately how long it will take for them to be delivered.

Cost-Effectiveness of Inventory Management Software

One of the areas where inventory management software provides the most value is in how it can save your SME money by increasing operational efficiency. As previously mentioned, inventory management software can help create a BOM. That means that it can also give you an estimate on the cost of the materials, which in turn can help your enterprise with budgeting. By being able to view estimated costs within your inventory management system, you’ll be able to put together more accurate financial plans for other areas of your business knowing in advance what these costs will be.

Inventory management software automatically calculates the value of the inventory that you have in stock, as well as the value for projected inventory levels for any given period of time, i.e. during a busy season. Inventory management software can even automatically calculate your inventory turnover rate so that you meet consumer demand without overstocking.  But the true benefit to inventory management software is in the way that it can reduce fixed assets. This helps your business stay more efficiently organized, saving space and storage. By knowing the exact location of your inventory, you can avoid wasting time hunting down the stock that you need. This way, you can maximize both labor and space. 

One of the best aspects of utilizing an integrated inventory management system is that there are extremely cost effective options that get the job done accurately and efficiently. Most inventory management software is cloud-based, which means there is no need to maintain servers, hardware, or an extensive IT staff. Additionally, some systems are priced based on the size of your company, so your growing business doesn’t have to worry about paying what a Fortune 500 company would have to pay.

Fixing The Problem Of Human Error

Here is where you really get what you pay for when you invest in an inventory management software system: the vast reduction and elimination of errors. As humans, we inevitably make mistakes—an inventory management software system can help eliminate those errors. As Forbes aptly points out, “factors like lack of experience, attention loss or fatigue can result in employees forgetting to complete tasks…these errors might seem small but such lapses have caused businesses to lose millions every year.” While Forbes is talking on the scale of large businesses, that doesn’t mean that the impact is any less significant for a growing business in terms of percentages of potential revenue lost. Additionally, the use of barcodes means that inventory is recorded more accurately than someone writing manual labels. In addition to more accurate labels, inventory management software is more efficient at organizing your inventory so that everything is stored neatly instead of like a complicated, 3D version of Tetris.

The Takeaway

While there are lots of different software solutions out there that serve an important purpose for businesses, inventory management software that’s integrated into the rest of your business’s processes can do everything that all of the other systems can do, and more. In addition to keeping track of orders, they can also manage your inventory stock and help save your company money by both mitigating human error in the process and by providing data on how much inventory to buy, when to buy it, and how to best store it.

Improve Efficiency with Inventory Management Software Solutions

Posted on by Matt Bernot

Losing customers? Anxious about your company’s longevity? Adopting more efficient management strategies is part of the solution. In today’s business environment, successful companies rely on information systems built upon complex database technology to support management decisions and increase frozen asset turnover. This is due to inventory management software allowing businesses to automate processes that were previously manual and time-consuming, with counting and cataloging inventory being one of the biggest processes.

According to Clara Lu at Quickbooks, since the economy is showing signs of strength again following the pandemic-induced global recession, the need for increased inventory control, flexibility, speed, and more accurate fulfillment is paramount for businesses to thrive in an increasingly competitive global economic environment.. Many experts concur that computerizing inventory control results in more devotion to the B and C items, as to the A’s, in the typical ABC analysis while also expanding the analysis to include the profit margin per item.

The first step in finding the best software match  to manage your business processes is understanding the history of this monumental system and then determining what type of business model a software system caters to.

Inventory Management: Past to Present

Inventory management has been around for centuries, and has historically been based upon principles such as Push and Pull and cycle counting. However, the modern history of the inventory management begins in the 1940s with the creation of the barcode. By the 1980s, with the assistance of more advanced computers and software, the systems of inventory management worked in a cycle, from purchasing, to tracking, and then to monitoring inventory. 

The price of barcodes and readers decreased during this time, and by the early 2000s, inventory management software had transformed so much that businesses no longer needed to input data by hand, and barcode readers could instantly update their databases. Finally, the most modern development in terms of  inventory management systems is in regards to radio-frequency identification technology. RFID technology allows for more information to be contained within a computerized tag  and gives computers the ability to read these tags without being in direct sight. Therefore, inventory management tools are a significant part of a company’s management.

Inventory management tools can be split into two parts: mathematical models/methods of planning, and an information system that provides a continuously documented database of data. Online analytical processing provides sophisticated technologies from data collection, integration, retrieval, analysis, query optimization, and advanced user interfaces.

Inventory Software Set-Up

inventory management software

Inventory management software has grown tremendously in what it can accomplish for businesses, especially in the highly competitive and revolutionary era of the 2020s. However, any software you may be looking into will fail to assist your business if your inventory management system needs serious remedies at the fundamental level, not just the technological level.

The critical elements of an inventory management system are well organized location names, specific location labels, short and unmistakable item numbers, units of measure, and passionate employees who know to follow your strong policies. Once these elements are established, you will realize that using pen and paper or spreadsheets to maintain inventory data is difficult and failure ridden. Using inventory software will allow many users to access it, provide insight to your inventory activity, and assist in keeping an accurate historical record.

Inventory Management is for the Future

Recently, the world has seen a strong shift away from in-house and basic warehouse management software solutions, with 68% of organizations moving to full-featured, cloud-based inventory management systems.

With these new automated processes comes more frequent and less stressful cycle counts, increased inventory visibility, greater fulfillment accuracy, and fewer scenarios where items are out of stock.. Any growing business has a business owner who focuses on profitability and scalability, and while inventory management may not be the most glamorous aspect of business, it can save your business from eating itself alive before your dream can be accomplished.

The Takeaway

Inventory management software can save or greatly expand the power your business wields. Similar to adding a highly technical and sophisticated employee, the right software will be able to help you make important decisions and guide your company in a direction that you previously only dreamed was possible. Deciding on a specific inventory management software to meet your business needs may take time, but establishing the critical elements of an inventory system is crucial before making this move for your company.