Inventory management software packages help companies keep track of the inventory and supplies they use to deliver products to customers more effectively. As a specific part of an Enterprise Resource Planning (ERP) architecture, inventory management platforms have become popular because of evident benefits when it comes to warehousing costs and delivery efficiencies. Here are some of the most important features and aspects of modern inventory management systems:
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Physical Scanning and Tracking
Ideally, inventory management software should be connected to bar code scanning or other processes that help put physical products into the system. The best inventory or stock management products have bar code scanning tools built into the platform. At the very least, there needs to be some way to document and catalog the physical inventory items. It’s also helpful to have a system that works with products that have multiple SKUs or product numbers. Some vendors develop these types of elaborate systems to handle a given item with more than one identifier.
Working with the Supply Chain
Companies offering inventory control solutions also integrate specific tools like inventory transfer technologies. These features track the products being shipped between business locations. A business with multiple locations oftentimes move inventory around to where it’s most useful. Facilitating these transfers is an integral part of inventory management software.
Reordering features are also useful. These features help make sure that companies have the products they need in hand prior to a particular customer demand, so that they don’t run out. Running out of inventory can be a significant disruption to a business, and can decrease sales and profits. Having robust ordering tools adds major value to a business’ inventory management efforts.
Product Handling Features
Some specific types of companies need more elaborate inventory management tools. One example is one that has perishable products on its inventory shelves. A food and beverage business, or any business that handles any type of perishables, often need to buy inventory tracking software that monitors the time handling of inventories.
Vendor-managed inventory products utilize a First-In First-Out (FIFO) or Last-In First-Out (LIFO) model. This helps the business to triage the delivery of inventory in a way that keeps products fresh, and provides the right protocol for moving specific aged inventory.
Other supply chain tools can help with the assembly of finished products from raw inventory materials. For instance, a company that takes a volume of product A and a volume of product B to make customer-facing product C benefits from inventory management tools that provide a reorder point for both A and B. Again, the best tools help label and track each raw material item according to freshness and its specific utility in building or putting together a finished product. For example, some systems need to look at obsolescence: if companies quickly innovate their products, a lot of the raw materials may get discontinued as product needs change. That has to be managed through an inventory control system of some kind.
Comprehensive Inventory Management Software Integration
Inventory management software is most powerful when it’s tied into larger company architectures. Premier cloud-based inventory management tools keep proprietary inventory data safe in a vendor system, but also link it to the larger ERP environment, so that companies can take advantage of diverse types reporting. Companies may pull from the vendor’s inventory management data to look at things like lead time, inventory level, and how each particular inventory item is handled. The reporting features of inventory software can be essential to getting a top-level view of what the business is doing and making the right decisions for moving forward.
Integration with Shipping
Inventory management software can also be integrated with physical shipping processes. Some tools advertise the ability to work directly with shippers like FedEx and UPS. This type of automation is valuable in inventory handling, and can save companies a lot of time and effort. That’s one of the major value propositions for inventory management software; It can take labor and business process complexity out of getting inventory on-site and keep it in the best condition possible for delivery.
Just-In-Time Inventory Principles
Along with the rise of inventory management software, there’s also been an emergence of new philosophies about inventory. The principle of Just-in-time inventory means companies can play closer to a supply and demand curve, quickly ordering additional inventory just before it’s needed.
This idea helps to reduce how long inventory stays on the shelf. As mentioned above, tools like this can also decrease the overall space that’s needed for inventory operations. Businesses that are able to shrink a warehouse footprint or close one or more warehouses can realize excellent return on investment with just-in-time inventory tools. Cost savings can be significant, so the use of just-in-time, or JIT, tools is part of what buyers look at when evaluating inventory management vendors.
Another popular feature of inventory management solutions is the use of customizable labels to track and handle inventory volumes. The more flexible and versatile a system is, the better it can accommodate a company with a complex inventory on-site. Some of the best systems promote the self-labeling of inventory items to make inventory management more accurate, and help a software solution better accommodate customer needs.
All of the above functionalities can help an enterprise meet its customers’ needs, with minimal cost and labor. Inventory management has become much more than just keeping inventories moving and physically safe. With modern tracking and analytics solutions, it takes care of major aspects of the a planner’s job. Good inventory tracking systems routinely solve problems for a business by helping top managers understand what’s on-site, as well as what needs to be on-site, and how to get it there.