What Is Inventory Management? The Full Guide

inventory management for an enterprise warehouse
Inventory management for a large enterprise warehouse
Apptricity is considered the best inventory management software because of its accuracy, reliability, and ease of use. Trusted by the US Army, US Air Force, Verizon, Brinks, and other Commercial and Government organizations, Apptricity leverages a combination of Bluetooth® Low Energy (BLE) beacons, patented edge devices, and proprietary software to provide real-time tracking of assets and inventory for enterprise level supply chains.

What Is Inventory Management?

Inventory management is the process of overseeing and controlling a business’s inventory, which includes the goods a company purchases, produces, and sells. It involves tracking and monitoring inventory levels, ensuring timely replenishment, and minimizing excess or obsolete inventory.

Inventory management also plays a vital role in businesses by helping them determine the optimal amount and timing of stock orders. It involves monitoring inventory levels throughout the supply chain, from the purchase of goods to their eventual sale, in order to identify and respond to trends and ensure that adequate inventory is available to meet customer demand.

Since inventory utilizes cash before it is sold, maintaining excessive stock levels can result in reduced cash flow and increased costs. Poor inventory turnover can lead to deadstock, or unsold inventory, which can negatively impact a business’s financial performance. Therefore, eliminating it is a sign that your management is functioning efficiently.

What Is Inventory Management Software?

Inventory management software is a vital tool that businesses use to manage their inventory more efficiently. It typically includes features such as location tracking, demand forecasting, order management, reporting and analytics, and integrations with other business systems. For example, integration with other ERPs is essential to inventory management software.

Why Is Inventory Management Important?

Inventory management is important because it helps businesses maintain optimal stock levels. This leads to improved efficiency, increased productivity, and better customer service. When operating effectively, it also helps minimize the risk of stockouts, reduce waste, and lower carrying costs.

Benefits of Inventory Management

Benefits of inventory management include increased efficiency and productivity, improved accuracy and reliability of data, better customer service, reduced costs and turnover, and increased sales and revenue. Proper inventory management can also lead to improved forecasting, better decision-making, and more strategic planning.

Efficiency and Productivity:

Effective inventory management can improve efficiency and productivity by ensuring that the right products are available at the right time. This minimizes stockouts and overstocking, and reduces the amount of time spent on inventory-related tasks such as counting and restocking. This can result in faster order fulfillment, reduced lead times, and improved overall operational efficiency.

Improved Accuracy and Reliability of Data:

By optimizing these processes, your team can gain real-time visibility into inventory levels and movement, allowing businesses to make informed decisions about inventory replenishment, pricing, and other aspects of their operations. Accurate and reliable data also helps to minimize errors, which can lead to lost sales and wasted inventory. Improved location accuracy is another core component that enables users to quickly find items that customers are requesting. Therefore improved accuracy and data reliability’s metric of success becomes happy customers.

Reduced Costs and Waste:

With this solution in place, businesses can reduce costs and waste by minimizing the amount of excess or obsolete inventory, optimizing inventory replenishment processes, and improving supply chain visibility. By reducing the amount of inventory on hand, businesses can also lower carrying costs such as storage and insurance fees.

Better Customer Service:

Maintaining optimal inventory levels can help businesses meet customer demand and ensure that products are available when customers need them. This can lead to improved customer satisfaction, repeat business, and positive word-of-mouth referrals. It can also help enterprises to quickly identify and respond to customer complaints or issues related to product availability.

Increased Sales Revenue:

Proper inventory management can help enterprises increase sales revenue since more requested stock and inventory become sold. This can lead to increased customer loyalty and excellent reviews. It can also help enterprises to identify and capitalize on trends and opportunities in the marketplace, such as seasonal or regional demand patterns. This increased insight grants inventory managers the ability to distribute any overstocks from other locations to the areas that need it most, resulting in increased profitability.

Inventory Management Challenges

Common inventory management challenges include inaccurate forecasting, stockouts or overstocking, inefficient inventory replenishment processes, lack of visibility or control over inventory, and high carrying costs. Other challenges may include the need to manage multiple warehouses or distribution centers, handling perishable or seasonal inventory, and managing inventory across multiple sales channels.

How Can I Use Inventory Management Software to Combat Challenges

Inaccurate forecasting:

Inventory management software can help businesses make more accurate forecasts by providing real-time data on inventory levels, demand patterns, and sales trends. This can help enterprises make informed decisions about inventory replenishment, pricing, and other aspects of their operations.

Stockouts and overstocking:

It can help businesses avoid stockouts and overstocking by providing real-time visibility into inventory levels and movement. This can help enterprises optimize inventory levels, reduce stockouts or overstocking, and ensure that products are available upon customer request. With our indoor positioning system, Apptricity inventory management software allows users to view when inventory changes positions within a floor, room, or across a warehouse or enclosed location. That key differentiator sets the Apptricity system apart from other inventory management solutions.

Inefficient inventory replenishment processes:

In addition, the software can help businesses streamline inventory replenishment processes by automating ordering, restocking, and fulfillment processes. This can help businesses reduce lead times, minimize stockouts, and improve overall operational efficiency. Purchase orders can be triggered when inventory thresholds fall below desired amounts. In addition, managers can quickly view which locations have the most inventory on hand to replenish other locations.

Managing multiple warehouses and distribution centers:

With inventory management software in place, Apptricity users can see inventory availability across locations and distribution centers. By using an automated tracking system, managers can streamline which inventory goes where and gain important reporting and analytics that help them make better data-driven decisions.

Handling perishable or seasonal inventory:

If your business handles perishable or seasonal inventory than an inventory management software solution is what you need. With this, your team can gain real-time visibility into inventory levels, location changes, and expiration dates. Prevent items from reaching their perishable dates and maximize inventory output according to the seasons they sell the quickest. With Apptricity’s inventory management reporting features, your team can use the data to quickly determine how best to optimize your warehouse or storage facility.

What Is Inventory vs What Is an Asset?

Inventory refers to the goods a business purchases, produces, and sells, while assets refer to the resources a business owns, including inventory, property, equipment, and cash. While inventory is a type of asset, it is generally considered a short-term asset. The idea is that it is expected to be sold or used up within a year.

In Apptricity tracking terms, inventory and assets are used interchangeably. The reason behind this is simple. If you can put a tag on it, then you can track it with Apptricity’s inventory management software. In our books, inventory refers primarily to items being sold. Assets refer to items in the long-term that your team would want to perform maintenance for and manage lifecycles. Regardless, whether asset or inventory, Apptricity users gain access from anywhere and real-time visibility from the palm of their hand.

Inventory Management Process

The process typically involves several steps, including forecasting demand, setting inventory levels, monitoring inventory levels, ordering new inventory, receiving and inspecting new inventory, storing inventory, picking and packing orders, and shipping orders to customers.

All of these are manageable within the Apptricity inventory management software system. As a company that helps organizations like the US Army and US Air Force manage their assets and inventory, regardless of the size of your enterprise, you can streamline each of these steps by: tracking which locations sell certain inventory the fastest, setting inventory levels within the Apptricity system, automating purchase orders when inventory falls below user-defined thresholds, updating inventory details as they arrive, tracking onboard/in-transit inventory shipments, tracking stored warehouse inventory, optimizing pick-pack-ship routes, and tracking shipping orders with GPS location updates. Not to mention, the Apptricity work order application can be used to manage those tasks and assignments as well.

How Inventory Management Works

Inventory management works by using various methods to track and control inventory levels, such as barcode scanning, RFID tagging, and inventory management software. Apptricity uses patented edge devices, proprietary software, and the best Bluetooth® tracking technology to scan and provide real-time inventory updates for enterprises globally. The result is optimal inventory levels, real-time visibility, avoided stockouts or overstocking, and minimized waste and carrying costs.

Why Is Apptricity the Best Inventory Management Software?

Apptricity is considered the best inventory management software because of its accuracy, reliability, and ease of use. Trusted by the US Army, US Air Force, Verizon, Brinks, and other Fortune companies, Apptricity leverages a combination of Bluetooth® Low Energy (BLE) beacons, patented edge devices, and proprietary software to provide real-time tracking of assets and inventory for enterprise level supply chains.

Apptricity’s system boasts location tracking in up to real-time, which is critical for enterprises needing to track inventory across locations. Additionally, the system can be easily integrated with other enterprise systems, such as enterprise resource planning (ERP) to provide a comprehensive solution for inventory management. Overall, Apptricity’s Inventory Management Software is a top choice for enterprises looking to improve their inventory tracking capabilities.

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