Product-based businesses face several inventory management issues impacting all aspects of their business — from client satisfaction to gross margin to return on investment. Whether or not it’s a lack of real-time visibility across locations or manual processes that lead to lost time and increased errors, most businesses, sadly, alter the pains of managing inventory at some point.
Let us take a look at some of the inventory management issues and solutions.
Short shipments or incorrect deliveries from suppliers
Supplier errors leading to short or wrong items were reported as the most vital inventory management pain. Global supply chains shift daily, burdening your inventory planning and management operations—the manufacturers and wholesale distributors that dictate when, where, and how your inventory ships need flexibility.
To relieve this pain, we should continuously monitor and track supplier performance to prevent supply chain disruptions, reduce complexity and streamline logistics. To monitor performance, pay close attention to supplier consistency and order accuracy. When possible, maintain some backup suppliers, which will be tested over time to determine which vendors should be maintained. Some inventory management systems additionally offer vendor management functionality that can help businesses determine which suppliers can be relied upon and which cannot.
Lack of visibility and supply chain responsiveness
When your inventory is difficult to spot or find within the warehouse, it ends up in incomplete, inaccurate, or delayed shipments. Receiving and finding the right stock is crucial to efficient warehouse operations, and supply chain models prioritizing responsiveness helps adapt quickly to change and provide positive client experiences.
Software package delivering comprehensive inventory visibility provides businesses insight into stock levels, demand, and sell-through by channel and location and links customer orders to items. Think about adding pictures with product descriptions in your inventory database to improve accuracy and prevent missing inventory.
Inaccuracies caused by disconnected systems
The following most typical challenge businesses cited is having multiple disparate systems where the data is not all synch in real-time.
Consider tracking software that has automated features for re-ordering and procurement. That kind of software will provide centralized and cloud-based databases for accurate, automatic inventory updates and real-time data backup.
Impacts of poor demand forecasting
The number one pain points reported by businesses were stockouts, lost sales, excess inventory, and other costs associated with poor demand forecasting. Determining the proper inventory levels can be challenging for many organizations, even during more predictable economic times. Underestimating demand leads to client dissatisfaction and lost sales when the items aren’t available. Overestimations of demand may result in excess inventory that ties up cash and warehouse space.
Some inventory management platforms include demand forecasting tools. Accounting and sales data can be integrated to predict demand and schedule orders based on shifting customer preferences, material availability, or seasonal trends.
Relief from the pain
While these pain points are too familiar for product-based businesses, you don’t need to suffer. If you’re encountering significant pain, it’s time to consider upgrading your business systems to Oracle NetSuite. Oracle NetSuite is the no. 1 Cloud ERP software in the world.
NetSuite ERP equips tracking inventory in multiple locations, safety stock, re-order points, cycle counts, demand planning, and distribution requirements planning. Using NetSuite, you will have clear visibility and control of your business; it allows you to focus on what you do best and to react to new market opportunities swiftly and confidently.
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