Did you know 45% of shoppers are unlikely to shop from companies if a package is delivered late? Put yourself in your customer’s shoes. Imagine getting a different product from the one you ordered from an online store. Maybe it has been a reality for some of you as well? What are your thoughts about the concerned company then?
If it’s a local business, you are already disappointed by the service and you make up your mind of it being the last order. Moreover, till the time you do not get the product you ordered, your thoughts on being deceived are supremely high. If it’s a well- known brand, you mention it on the review, give a lower rating, and opt for cash on delivery the next few times. Getting the correct commodity delivered to the correct place, restocking the necessary inventory as and when required are the primary prerequisites of a business. If you mess that up, you’d rather shut down the business.
Having said that, inventory management can take up a lot of time and cost if not managed correctly. For small businesses, it’s the difference between shutting down in a year and thriving for years while for large companies it is using the resources to innovate and outpace competitions and decrease operational cost. As technology continues to better itself, the key is to use it in such a manner so that you can always keep a track of the stock effortlessly.
Real-time inventory management is essential for a business, let’s get to know better about the concept and why is it important?
What is Real-Time Inventory Management?
Real-time inventory management is the process that uses software to record the purchase and sale of inventory with every transaction made. Unlike the previously carried out periodic inventory counts, real-time systems keep the organization aware of the entire picture of inventory, enabling them to react quicker on supply chain management. The concerned individuals can track the purchases of stock and the outbound orders at any and every time. Certain enterprise-level systems combine all of these functions under ‘ one software roof’. Furthermore, some companies use tools like RFID (Radio Frequency Identification) technologies, popularly known as bar code systems to record new receipts and sales.
Benefits Real-Time Inventory Management
1. Avoids Stock Out and Excess Stock
It lets the company have a better purview of stock outs and excess inventory than the periodic inventory management system. Updating all receipts and sales in real-time can give you data up-to-the-minute, which will more effectively lead you to budget the demand and supply of your product. Furthermore, it leads to effective storage space management. The warehouse will be more organized hence, reduce recounts of inventory.
2. Decreases Unnecessary Spending
When you can track changes in the warehouse -inventory in real-time, you can cut down unnecessary expenses by selling out stocks before they become dead. Having the real-time data before you all the time, lets you approach buyers and sellers accordingly.
3. Prevents Fluctuation in Inventory Level
Experts recommend adopting a just-in-time inventory strategy to increase the accuracy and efficiency of fulfilling orders by keeping only short-term inventory as storage, to avoid the costs involved in holding excess stock. The drawback to this is that it will require an accurate understanding of stock levels and customer needs. It turns out to be quite an overwhelming task for store managers. Tracking through real-time inventory can introduce organization officials to inventory levels in respect to seasonal demands and popularity, thus providing a consistent service.
4. Improves Customer Experience
The expected time of delivery after the order is just 2-3 days. This raises the standard for small business and makes it a bit daunting for them. Hence, to make their mark, they have to put their best foot forward, and opting for real-time inventory management is a crucial step in that. Having adequate stock at the store, be it offline or online increases the potential of having a larger customer base, as it might give an additional edge to the organization.
5. Helps in Accounting
It’s a wonderful help to the accounts and finance team because knowing the exact requirement of inventory gives them a more accurate picture to report on the warehousing costs. The real-time system works in helping to catch errors quickly, thus saving time.
The Best Inventory Management Software Are
- Cin7 – For Enterprise Resource Planning
- Zoho Inventory – For Multi-Channel Retailers
- QuickBooks Commerce – For Wholesale Businesses
- Ordoro – For E-Commerce Websites
Now that you are aware of the benefits offered by real-time inventory management, and the best software available for your business, your first decision for your company should be to manage the inventory effectively.