Back in 2020, the pandemic brought about panic buying in New Zealand and across the world. The sudden shift in consumer demand and supplier struggle to keep up with the rapid changes made one thing clear — it is critical for businesses of all sizes to reliably and cost-effectively manage their inventory.
Whether you run a retail or manufacturing business, the pivotal role that inventory management plays in staying on top of daily operations, preventing loss of sales opportunities and keeping your business running cannot be denied.
Predicting the future success of a business can be hard by solely relying on past sales. However, the real-time insight provided by proper inventory management will allow businesses of all sizes to limit the risk of stockouts, respond to trends, maximise profits, accurately determine customer preferences, figure out best-selling products, and more.
And to keep your inventory at an optimal level, leveraging an inventory management system is one of the best ways to ensure that there is the right amount of inventory available to fulfil sales obligations. This also applies to small business owners that were pushed to run the show from their homes due to the pandemic restrictions and are still struggling despite the nationwide loosening of regulations.
Businesses of all sizes will have to track inventory to help keep a healthy stream of cash flowing through their business. The same is necessary to ensure that there is always an ample supply of products to meet the ever-changing customer demands. These are even more critical to small businesses that are constantly looking for opportunities to become big and profitable. But what is inventory management and its goal?
Inventory is defined as any finished goods or raw materials that businesses hold in order to generate income and profit as well as create value for their customers. These goods and materials can take on the form of the products that customers purchase or even the raw materials required to produce these products. This makes inventory management a business’ process of keeping track of anything and everything from raw materials to finished products. Doing so ensures effective inventory control, mitigating the risks of losing revenue or spending because of overstocking or running out of supplies.
Inventory management software consists of tools and applications that help track, manage, and organise every element related to the business inventory. With advancements, there is now inventory management software that is capable of automating some processes, monitoring real-time movement of stocks, and supporting multiple warehouses. Given its long list of benefits, it comes as no surprise that utilising the right and most effective one for your business can help in saving money and maximising sales.
There are a ton of inventory management solutions and types. And even though there might be no cheaper alternative than popular manual methods like pencil-and-paper or excel spreadsheets inventory control system, leveraging the power of inventory management software bridges many gaps. Not only can you avoid human errors and rid the need to constantly back your data up, but being made for the job, inventory management software also allows you to accurately count and track your inventory and obtain thorough reports on stock levels and other essential information.
Some of the other benefits of inventory management software for small businesses include:
One of the key benefits of modern-day inventory management solutions is that they are able to provide real-time visibility into the various nodes in the supply chain, be it the production facilities or the distribution centres. Having such a clear view of the bigger picture of things allows business owners to leverage every bit of information and data to maintain customer satisfaction and revenue streams. From making changes to production schedules and improving warehouse space utilisation to identifying transportation problems, inventory management systems can help make decisions where restocking, meeting demands, and maintaining production levels are concerned.
When proper inventory management and planning are in place, the entire business system can be run efficiently while simultaneously acing stock control. This is because you will be able to identify the most in-demand products and even take measures to further improve your inventory system. By using real-time data, you can improve sales strategies, avoid stockouts of your best-selling products, and waste spending on manufacturing products that do not profit the business. These will all, in turn, go directly to your bottom line in one way or another.
Do you know how much inventory you will need every year to satisfy your customers? By looking at your inventory and sales data, you will not only be able to see how much of a single product or material you sold or used but also see if any trends exist. Based on all these numbers, you can, as accurately as possible, decipher if you require more or less of said product or material in the next few months or years.
Every business owner will agree that being up to date with the latest trends and adapting to current and upcoming demands is important when attempting to have the right amount of stock to meet your customer’s needs. When you utilise an advanced inventory management system, you will be able to retrieve insights such as customer transactions to better understand the market trends and thereafter improve product availability to stay on top of your game.
Inventory management is a key component in supply chain management. Since supply chain management is the management of the flow of goods, any associated challenges should be addressed by determining inventory levels with higher precision. With sophisticated stock control systems, business owners can come up with demand plans, which can then be incorporated into the supply chain planning to better manage uncertainty.
From preventing shipping delays due to shortages to improving order accuracy for all filled orders, having an effective inventory management system in place allows you to constantly keep your customers satisfied. And since returns can be costly for businesses, the improved accuracy delivered by a store management system lowers the possibility of the wrong products being shipped to customers, and return logistics will not be something you constantly have to worry about.
Leveraging inventory tracking systems and software can help your business develop some level of synergy across various nodes of planning and inventory management, as well as important supply chain functions. The result will inevitably be improved efficiency, better customer satisfaction, and higher profit margins.
One of the ways to get your foot in on inventory management is to work with an international courier service provider that offers tracking and monitoring functions and shipment visibility and management features to help businesses gain better control over their inventory management. Understanding that the presence of tracking services can increase customer satisfaction, DHL Express offers all the shipping solutions you need in one convenient place.
If you are looking to leverage our DHL shipment tracking tools or boost your inventory management, consider opening a business account with DHL Express NZ today.