Because of ongoing supply chain disruptions and rising prices, many business executives are focusing on inventory management and are aware of the impact of excess inventory on cash flow and profitability.
If your requirements are simple, you may be able to acquire a basic inventory management system. Businesses risk the following if they do not have an appropriate inventory management system in place:
1. Incompetent Inventory Management
Having no software system to track inventory numbers and value can result in lost items, excess inventories that lose value, and inefficiencies.
2. Overstock & Understock
For small businesses that have to purchase in large quantities, this can cause an overstock situation if the supplier has more inventory than the business has ordered. It can also mean understocking if the supplier doesn’t have enough inventory for the business’ needs.
3. Disruption of Operations
If inventory is missing, you may have to stop production or face customer dissatisfaction.
4. Price/Demand Inaccuracies
Not knowing what demand is can affect the price you pay to your supplier and the price you charge your customers.
5. Lack of Visibility
Lack of visibility into inventory activity can lead to higher costs and productivity issues.
Benefits of Using Inventory Dashboards
If your inventory practices are deteriorating or you are unable to keep up with demand, using a management strategy is an excellent method to improve things. In fact, the number of organizations investing in improved inventory management methods has increased by 25% in the previous few years.
By using inventory dashboards, you can benefit from the ability to:
1. Create and Visualize Key Performance Indicators
You can create a dashboard that displays key performance indicators. In order to create the dashboard, you need data about your business, including:
– Sales and inventory performance over time
– Customer and employee data
– Company financial data
For example, with inventory management software, you can track inventory levels and performance. You can determine whether you need more stock due to demand or if your inventory has risen above an acceptable limit.
2. Make Strategic Decisions
After you know what your KPIs are, you can use them to make strategic decisions. For example, you might determine that your inventory levels are too low and initiate the purchasing process to fill them and maintain a maximum inventory level. You might decide to make changes to the products or services you provide or the company’s marketing strategy if sales are too low.
3. Monitor Trends
By getting reports just once a month or once every few months, you may not be able to react quickly enough to trends that affect your organization and its performance. By having access to data in real-time with inventory software, you can stay on top of trends that could affect your organization.
4. Create Fulfilment Rules Based on Predefined Criteria
By assigning different fulfillment rules to different items (based on the customer’s current location and other criteria), you can have the software manage your inventory levels.
5. Reduce Inventory Requirements
With the ability to monitor trends, you can make changes to your business based on the data. For example, if you determine that demand for your product or service is low, you can lower the price to increase demand. You can also decide to discontinue your products or services if they are no longer profitable.
6. Cut Costs Across the Board
With better inventory management, you can reduce the costs of carrying inventory, which can cut costs across the board. By avoiding overstocking or understocking, you can save on storage costs, insurance, and other inventory management expenses.
Conclusion
Inventory management software can help you manage your inventory levels and performance. By using inventory management dashboards, you can track key performance indicators, make strategic decisions, monitor trends, and create fulfillment rules to maximize profitability and success. It can also save you money and cut costs across the board.
Are you looking for business management solutions involving the cloud? Reach out to Nuage Consulting Group today! We provide tailored cloud business management solutions with implementation and services that are incomparable.
