“Make your product easier to buy than your competition, or you will find your customers buying from them, not you.” – Mark Cuban
In today’s dynamic world, managing every aspect of your business is imperative to the productivity. Unquestionably, inventory is one of the largest expenses incurred by the business as it drives production, sales, and customer service. Inventory is one of the major aspects of current assets in the business and should be maintained efficiently; excess stock increases unnecessary inventory carrying costs, working capital requirements, and ultimately business loss. Inventory management is the foundation of any company within the wholesale and manufacturing business. Inventory reliability is the key element to ensure the smooth functioning of operations
Managing inventory with a comprehensive Enterprise Resource Planning solution is a prerequisite to proper inventory management. From planning, organizing, coordinating, directing and allocating the resources to facilitating paperless transactions, scanning barcode etc., an ERP manages a whole lot of business functions, with ease. An ERP offers a streamlined solution to your total business needs by providing inventory information quickly, efficiently, and accurately. With efficient Inventory Management, you gain the insight needed to make better, timelier business decisions.
#What is inventory accuracy?
Inventory accuracy ensures that the right balance of stock is maintained in your warehouses. To ensure inventory accuracy, cycle count should be appropriate. Now, here comes the question – what is cycle count? A cycle count is an inventory auditing procedure that ensures counting a small subset of inventory in a specific location on a particular day.
It is true that to balance the inventory levels, it is crucial to have a deeper understanding of the customer demand for your products. But, cycle counting equally curbs this scenario. Any error witnessed during these counts are addressed to the inventory accounting records.
Inaccurate inventory can lead to –
- Low service levels
- Increased operating cost
- Poor customer service
- Product obsolescence or spoilage
- Extra storage cost
- Higher inventory levels
#How can ERP system improve inventory accuracy?
- Maintain an efficient and well-defined warehouse
Before procuring raw materials or other goods in your warehouse, make sure that you plan and strategize it appropriately. While excess goods can lead to blocked capital and storage cost, stock-out can lead to unsatisfied customers. It’s a dicey game. But if you have a reliable ERP solution, it can change the entire scenario.
ERP or Enterprise Resource Planning solution is a comprehensive software solution which encompasses a wide grouping of business processes in ‘modules’ – production, finance, sales, inventory, accounts, customization, supply chain planning and more. It is wise to invest in an ERP which can help you accomplish comprehensive tasks regarding warehouse management with just a few mouse clicks.
Make sure that you maintain well-organized bins or shelves to locate the inventory items, whenever required. Every space in the warehouse needs to be maintained and optimized with utmost accuracy and mindfulness. An inventory management system automates the processes of checking purchase order, receipts, issue and transfer of the inventory. It lets the warehouse manager accomplish the given tasks in a streamlined way.
- View a bigger picture of your organization
If processes and procedures are in place, inventory can be maintained effectively and precisely. When an inventory issue crops up, warehouse managers should have the knack of reacting in a positive manner so as to streamline every function. An ERP software is required to be pre-built with automated solutions which are focused on streamlining the warehouse activities – warehouse transfer, inbound and outbound transfer, barcode scanning and generation, label printing and much more. This helps you plan from materials which need to be procured, which payments to make, which vendors to contact, where to stock the items and more. One complete software lets you manage sales, purchase, quality check, lot traceability, cycle count, inventory operations, finance and accounting etc. This reduces errors, delayed work, encourages planning, reporting and forecasting and allows employees to work with efficiency and dedication.
- Increased customer satisfaction
When you get accurate information about inbound, outbound shipments, item location and pricing of the product, it eliminates product shortage and this means that your customers will receive their orders on time. An ERP is one of the key software solutions in the manufacturing industry to streamline overall business processes. This manages customer calls, queries and the entire customer lifecycle. ERP fosters customer satisfaction by offering –
- Streamlined shipping operations
- Good supplier relationships
- The improved user experience on every release
- The equilibrium between supply and demand
- Less rework and data redundancy
- Eliminating old and archaic spreadsheets and manual processes
- Keep a check on the quality of items in your warehouse
ERP systems are tightly integrated with the Quality Management functions. It ensures that items which are stored in the warehouse are ready to be used in production and aren’t damaged. This lays focus on lot traceability, managing test processes, use quarantine orders to set aside items in quarantine. ERP solution ensures that timely decisions are made by the higher-ups in order to control compliance and predictability. Businesses can plan for a single level, multi-level sampling, easily track batch and serial numbers to support Quality Control operations.
- ERP lets you plan an inventory roadmap with MRP, MPS and cycle counting
ERP supports Material Requirements Planning and Master Production Schedule. MRP ensures that the warehouse is stocked with a right amount of inventory for production so as to avoid customer dissatisfaction. MRP facilitates planning for multi-level processes – it allows you to track inventory, specify timelines, data sources and adapt to changing demand. On the other hand, MPS manages lead times, plans for finished goods, ensures allocation of resources and more.
To ensure that right amount of stock is available in the warehouse whenever you need it, ERP is the one-stop solution to invest in. It reduces unnecessary expenses and unwanted stock. OptiProERP with SAP Business One is a complete Enterprise Resource Planning solution which nurtures a productive work environment. Driven by a team of well-versed professionals, SAP certified consultants and developers, it is a powerful software solution which caters to a wide range of industries. To know more, you can email us at email@example.com.