Tracking and managing inventory is a crucial aspect of any e-commerce business. With that said, as a business owner, are you wasting your valuable time and resources on under-optimized processes and systems? Are you finding it hard to forecast your inventory needs accurately? Or facing difficulty in tracking inventory across different sales channels? When was the last time you did a delivery on time without any hassle?
How many times it has happened that someone places an order, and when you go about to process it, you find that you are actually out of stock. Ever happened to you? If yes, it means that you follow poor inventory management tactics where you don’t even have access to real-time stock counts. If you continue on this road, where you don’t adapt, you are anticipating your business’ failure.
We live in a day and age where the competition is fierce, and if you want to survive and build your business, you must adapt to the latest trends in your industry. As we talk about the latest, inventory automation has saved business owners from manually processing their inventory.
If you automate inventory, you are saving not only time but reducing the human intervention as well, which ultimately saves a lot of money and ensures that errors remain on the ground.
Let us first understand what is inventory management-
What is Inventory Management?
Inventory management is an element of supply chain management, which supervises the flow of materials or goods from the manufactures to the warehouses and from these spaces to the point of sale.
Globally, retailers recorded a staggering $1.75 trillion loss due to mismanaged inventory. Cost reduction is one of the major reasons why inventory management is crucial for business. From the point of view of the customer, efficient inventory management ensures better customer service with low shipping charges and fast delivery. Automation has helped a lot in this aspect. With that in mind, here are the top reasons why you should invest in automating your inventory management-
Automating Inventory Management Saves Time
A business is always searching for techniques to save time and reduce labor costs. If they automate inventory management, they can eliminate manual and labor-intensive processes. Through barcode scanning, the need for typing in product or box numbers for each item is completely eliminated. That is, once your products are scanned, your inventory is automatically updated whenever a product is sold or purchased. No manual work is needed! This saves a lot of time.
It Keeps ‘Human Error’ at Bay
Since the need for maintaining paper documents and spreadsheets is eliminated if you automate inventory management, clerical errors are reduced. Additionally, automated solutions help ascertain accurate operating costs, sales cost, and identify your worst and best-performing items easily. Just by using barcodes, a decrease in administration errors decreased by 41.4% at a medical center.
Automating Ensures Accurate Inventory Level
If you or your employee writes down every time an item is purchased or sold, the chances of committing errors increase. With automated inventory management, you can be sure about the accurate level of the stock present.
So, if a customer calls and asks if you have certain units of a product available, you just have to look at the screen to know how many units of that product you have in your inventory instead of counting them manually.
It Allows you to Control the Cost
Lack of the right inventory at the right time can mean excess inventory, backorders, etc. If a product is stored for long in your warehouse or if an order is missed, your costs increase. Automated inventory management helps you to maintain records about which product is doing well and which one is sitting on the shelf. This way, you will not accrue losses from storing the wrong products for a longer period or miss out on orders of out-of-stock items.
Automating Inventory Management Improves the Quality of Delivery
Almost 81% of customers experience the ‘out-of-stock’ condition in the last twelve months, which resulted in lost sales for retailers as well as disappointments for the customers. If you have sufficient stock all the time in your warehouse, you will be able to deliver the products on
time. This will improve your reputation as a business. For tracking, you must know when a vendor is shipping the inventory as well as when it will arrive.
With Automated Inventory, you can Make Easy Forecasting
Automated inventory management software helps you enhance demand forecasting by evaluating data trends from stocks. So, before ordering new products, you will know how many units of the product you should order to meet the anticipated demand.
It allows you to Sync Stocks under Multiple Sales Channels
If you are active on more than one eCommerce platform, an inventory management software will help you sync the stocks under varying sales channels. Your inventory on each platform will be updated automatically once the sale is made.
Tips for Effective Inventory Management
Using barcode scanning – It is one of the most effective and cost-effective ways to maintain inventory using automation. You do not have to manually count the units in your inventory, and through barcode scanning, you can scan your products and your inventory gets updated automatically every time a product is bought or sold.
Integrating various platforms – If you sell online on several platforms like eBay and Amazon, an automated system will synchronize your inventory across various channels. You just have to link the product on several marketplaces, and as soon as a unit is sold, the stock for that product will update on its own.
Managing slow-moving items – When you automate inventory, keeping a check on how fast or slow an item is moving becomes easier. The longer an item sits on your shelf, the pricier it gets. So, avoid ordering that item in bulk.
For a business, automated inventory management using software has become extremely necessary. Almost 40% of small businesses do not track their inventory using software even now.
However, if you do not automate the inventory management of your business, you may end up compromising on your profits. Without automated inventory management, you are prone to take more time while managing your inventory as well as making more errors while keeping track of all the inventory.