Inventory control also referred to as stock control, deals with “all aspects of managing a company’s inventories, i.e. purchasing, receiving, tracking, warehousing and storage, shipping, turnover, and reordering.” Its core objective is to maximize profits with minimum inventory investment that too without affecting customer satisfaction levels. Inventory control is also knowing about where your stock is, how much of a particular item is available and ensuring that the products are stored well.
Such is the importance of inventory control to an organization’s efficiency and profitability that they can’t simply rely on error-prone manual methods of inventory handling. That’s actually why so many companies select IT tools for inventory control, including warehouse management system and ERPs so that all of its components are managed by one integrated system.
When it comes to inventory control, most of the manufacturers or distributors have reported the same issues repeatedly. Let us see what the possible challenges businesses face without an ERP software:
- Stock-outs of products, resulting in backorders, lost sales and dissatisfied customers.
- Surplus of the products, which leads to excess inventory levels, increases in carrying cost due to increased use of warehouse space and product maintenance.
- No track of products which are present in inventory, because the primitive business methods can’t keep up with managing the growing demand and speed of business.
- Inability to find out the exact location of the material, leading to the consumption of a huge amount of time in searching the material and delay in deliveries.
Constant inventory management issues can drive your customers, vendors and suppliers away. The bottom-line? You just can’t afford to lose your market presence and reputation. Over-inventory or under-inventory, both affect your finances and damage the overall health of your business as well as business opportunities.
Now think about:
Having full control over your inventory, delivering the products on time, tracking your materials, maintaining an optimum level by avoiding wastage and expiration dates of the product. Feels everything perfect, right?
Optimum inventory management is the objective of every inventory planner which can be achieved by using Enterprise Resource Planning (ERP) software. Continue to read to get more insights on ways to use the ERP system for inventory control:
#1 Overall inventory management
Get a complete view of inventory under one platform
Every business aims for stock optimization and inventory control to keep track of the items that are selling briskly. In ERP, you get a pre-built automated solution which helps in streamlining all inventory activities. Besides providing real-time visibility of inventory across the operations and supply chain, the software also helps in better decision making by providing necessary planning tools.
#2 Item administration
Get multiple ways to classify products and group them in your inventory
With the help of an ERP software, you can manage different type of items with easy tagging, classification and item analysis. You can classify items, manage multiple units of measure, get the item details, set up valuation methods, identify standard supplier, set allocation methods, various costs and substitutes for an item. By doing so you achieve:
- End-to-end real-time visibility
- Effective analysis and control
- Optimized inventory levels
#3 Warehouse management
Get smarter warehouse managing techniques
With the help of an ERP software, you can track the items right from their entry as a raw material from the vendor to their exit as a finished good to the supplier/customer. The software aids in managing supply chain activities and allows you to access bin locations to determine the exact position of the item placed. The application helps you in executing warehouse operations in an effective manner by ensuring activities related to stock transfers and quality checks go right. With lot/serial tracking of items, you can identify the item easily, perform quality tests, check the expiry dates and retest the lot (if needed) easily. This feature:
- Enhances inventory management by decreasing inventory levels, improving order fulfillment and reducing order cycle time.
- Co-ordinates between the movements of goods from in and out of the organization warehouse(s).
- Provides speed and visibility across the supply chain within the organization.
- Ensures necessary bin access control in your storage locations.
- Helps in responding faster to the customer through real-time information.
#4 Inventory replenishment
Ensure perfectly adequate inventory levels
Over and under inventory levels result in affecting your business revenues. Surplus inventory increases your expenses, whereas deficit inventory results in losing sales. With ERP software, you can maintain accurate inventory levels matching up with the requirements. You can easily know when to procure a material, thus avoiding unnecessary wastage. It helps in following ways:
- Holding accurate inventory levels avoid loss of sales and decrease overhead costs.
- Reduces the risk of production shortages.
- Improves the accuracy of inventory orders.
- Helps in forecasting the future stock needs with precision and accuracy.
- Avoids stock outs and delivers high satisfaction to the customers.
#5 Quality concerns
Keep an eye on the quality of your inventory items
ERP software allows seamless integration of quality management with all other business activities, especially inventory. All the materials are tested and examined for signs of damages such as leaks, tears, broken seals, discrepancies in the product description, or any faults etc. With the help of ERP software, you can define quality inspection plans based on certain checklists, or other properties to enter into the testing phase. The module ensures that each and every detail of the process and material is noted and the pass/fail status feedbacks are saved. It:
- Not only helps in avoiding unnecessary stock handling, but also helps in analysing product’s quality and offering the best quality to the customers.
- Eliminates poor quality of products through strict quality control parameters.
- Ensures good customer service by delivering the promised quality product.
#6 Physical inventory handling
Ensures the most accurate view of handling inventory items
With the help of an ERP software, you can easily map and validate physical and system recorded inventory levels. These effective records relate to stock variance and adjustments for having an accurate view of the inventory.
#7 Inventory analysis
Ensures your warehouse is stocked right and bins are handled properly
Complete inventory analysis is necessary to ensure that you have sufficient inventory on hand- to meet the needs of both your customers and operations. With an ERP software, you can maintain optimum inventory levels by various inventory analysis methods.
- Analyze your inventory-level requirements through multiple methods.
- Save money and improve service levels by maintaining adequate levels to serve current and future needs of the production.
#8 Inventory planning
Plan your inventory with MPS and MRP
With an ERP, you have the functionality of the Master Production Schedule (MPS) and Material Requirements Planning (MRP). MRP helps in ensuring that appropriate material levels are available for production and necessary products are delivered to avoid customer dissatisfaction. It also reduces waste by maintaining the lowest-possible material and product levels in the stock. Whereas, MPS decides what is manufactured, what material is procured and which schedule planner is to be followed to make them. It serves as a bridge to sales as it helps in accessing information about what is to be made for customers and when deliveries are to be done.
Avoid all your inventory pitfalls with BatchMaster ERP software, and ensure the right stock at the right location, at the right time is available just to meet the production as well as customer’s demands. Inventory control is a vital survival step for any business. So, with BatchMaster ERP, strike the adequate amount of inventory for your business and drive home greater revenues. To know more about the product, contact us at: email@example.com.