For those trying to keep their operation running smoothly, maintain timely order fulfillment, and keep customer satisfaction high, inventory visibility and inventory management go hand-in-hand. Without a clear understanding of what products you have available and what stage of the order-to-cash cycle they’re in, you’re left with a lot of question marks when customers or vendors call to ask about their orders or deliveries.
In this blog, we’ll outline some of the most salient benefits of and challenges to achieving inventory visibility, as well as steps you can take to improve it in your operation with the SalesPad by Cavallo® suite of solutions for Microsoft Dynamics GP.
What Is Inventory Visibility?
Real-time inventory visibility is insight into the location, quantity, and movement of inventory throughout the complex supply chain. It involves comprehensive visibility from the moment raw materials are procured to the final product reaching the end consumer.
Having full, real-time visibility of your inventory means knowing with confidence the ins and outs of your warehouse. You need to know what you have, where it’s located, and what it’s worth—with no room for error.
From stock levels to specific items to transit routes, gathering these types of data is crucial in determining your inventory availability and subsequent decision-making. Successful demand forecasting, replenishment, and fulfillment all depend on accurate inventory data and proper warehouse management.
Benefits of Inventory Visibility
For any product-based brand, full awareness of your current inventory levels is a must to keep your business organized. Guesswork has no place in demand forecasting if you want to avoid losing money to stockouts, dead stock, and overstocking; allocate your resources better; and maintain positive customer relationships.
Avoid Stockouts and Overstocking in Your Stores
Whether you’ve got excess inventory or not enough, your operation is not as profitable as it could be. Maintaining appropriate inventory levels is key. With high supply chain inventory visibility you can avoid stockouts—inventory shortages— and overstocking—unsold inventory—across multiple storage locations by comparing the products you have in stock with the items running low.
With this information easily accessible, you can be confident that you’re ordering the optimal quantity of inventory to satisfy your customer demand, without letting items sit on the shelf and collect dust.
Perform Accurate Demand Forecasting
Ensuring that you’re basing your reordering and replenishment strategies on accurate data is vital to keeping the right amount of inventory in stock. If you prioritize inventory visibility, you have the benefit of looking back at historical data across your sales channels, including the time and data of past orders, the type and quantity of items ordered, and more.
Referring back to this information helps you predict growth and trends you may have missed otherwise, and meet consumer demands time and time again. Though you can’t expect to always have perfectly accurate demand forecasting, enhancing visibility is a great way to get as close to 100% inventory accuracy as possible.
Ensure Smarter Resource Allocation
Knowing where all your inventory is located and where it stands in the order fulfillment process also enables you to be smarter with your resource allocation. When it comes to supply chain management, rely on your data when deciding how much inventory to keep in each warehouse and distribution center. This will save you shipping time and costs when the orders flood in. And your customers will be pleasantly surprised when their order gets to them quicker than expected.
Improve Your Omnichannel Sales Management
Omnichannel sales—the integration of all your sales channels—has been on the rise in response to the popularity of eCommerce in recent years. Unifying your sales channels from in-person stores to social media to a website improves the customer experience tenfold, by giving them the flexibility to buy from the platform of their choosing.
Furthermore, a lack of inventory visibility breeds trouble when you’re trying to organize stock levels across multiple locations and sales channels. Keeping your internal records accurate ensures that you aren’t selling items you don’t actually have on hand.
Exceed Consumers’ Expectations
Customers are at the heart of your business, so it’s important to prioritize a seamless customer experience for them. From an inventory standpoint, that means making sure your stock levels meet demand, so that orders are fulfilled in a timely manner and customer expectations are met. The better their experience, the more likely they are to buy from you again in the future.
The bottom line is that each of the five previous benefits save your business money. A faster order-to-cash cycle means you get paid faster. Avoiding stockouts and overstocking gets more orders out and prevents the buildup of extra product not selling. Happier customers now means return customers and more orders in the future.
When you take the time to optimize your inventory management and strive for full visibility of your products, you’ll see massive gains in efficiency and thus, profitability.
Roadblocks Companies Face
While the benefits of inventory visibility are straightforward, several obstacles stand in the way of achieving it.
Poor Warehouse Setup
If you’re a product-based business, a warehouse setup that works for you is key to keeping your operation efficient and profitable. From mislabeling products and bins to poor grouping of similar products, warehouse inefficiencies raise the risk of inaccurate picking, packing, and shipping. What’s more, the less organized your warehouse is, the more difficult and time-consuming it is to find the products you need and determine what stage of order fulfillment it’s in.
This mismanagement can snowball into other issues, like inaccurate demand forecasting, an excess of backorders and overstocks, and bottlenecks that prevent customers from receiving their orders on time.
Relying on Manual Processes
Simply put, the more manual your inventory management processes are, the more susceptible they are to human error. Mis-picks, inaccurate inventory count, and faulty reporting all hurt your decision-making as well as the overall customer experience. Furthermore, waiting for employees to manually approve orders, update information, and record packing and shipping data is tedious, and not the best use of their time.
How Businesses Can Improve
So what’s the answer? Getting the perfect warehouse setup and attaining high inventory visibility won’t happen overnight, but there are effective, practical steps you can take to start moving in the right direction.
Implement Barcoding and Scanners
Introducing barcode scanners to your warehouse operation is one of the best actions you can take to significantly improve your picking and packing accuracy and time management. With barcoded products and bins, simply scanning the code will tell you at once whether or not you’ve got the right item in hand—thus drastically reducing opportunities for error and doing so in a fraction of the time it would take manually.
Another added benefit of barcode scanning is the fact that retail and manufacturing companies from across the globe use and accept this form of technology, so you won’t run into compatibility issues with vendors or other businesses.
Automate Where You Can
Taking the time to learn more about automation and where it fits into your business is time well spent. Rather than relying on employees to manually move inventory along in the fulfillment process and manually update information, you can invest in software that provides features like real-time inventory updates, replenishment alerts, and demand forecasting. The more processes you can automate, the more time and hassle you’ll save on a day-to-day basis.
Raise Customer Satisfaction with Advanced Technologies
Managing a warehouse—or several—full of inventory can be overwhelming. There are a lot of moving parts to any operation, so it’s crucial to equip yourself with the right tools to keep track of all your inventory. Introducing, SalesPad Inventory Manager.
Inventory Manager is your all-in-one solution for fail-proof inventory operations, 100% order accuracy, and visibility of the entire order fulfillment process. This barcoding tool syncs your inventory data directly with Microsoft Dynamics GP, so you have accurate information from the start and can track your inventory in real time with ease.Go beyond inventory visibility with SalesPad’s full line of order management solutions, and Cavallo’s suite of products for Microsoft Dynamics 365 Business Central. Book a demo with our team to learn more.