The use of technology and especially software products in different professions is getting popular by the passage of time. From educational institutes to space science, these software systems are able to make our life easier by doing complex computation and management in an efficient fashion. Similarly, modern industry is also making use of IT for management of resources. Inventory software is an example of such software products which are being used by today’s industry for tracking inventory levels, orders, sales, and deliveries of their products. By keeping an eye on the current stock of a company, these software systems help the corresponding organization in avoiding product overstock and outages. These software tools have provided the privilege to organize data in a smart way that was generally stored in spreadsheets and books earlier.
Each of the inventory management software systems has some key features which make it a vital need for industry.
- These software products do “Order Management” for the company which means these products track the inventory and whenever it reaches a specific threshold, the system is programmed to tell the managers that more product should be ordered.
- Similarly, “Service Management” is also supported by the said systems which particularly benefits those companies that can primarily be referred as service-oriented rather than product-oriented.
- The system can be used to track and manage the cost of such materials which were used to provide services to the customers.
- Adding to that, the smart tool can help the company in deciding the price of their services which really reflects the total cost of performing that particular service.
- These systems provide the feature of “Asset Tracking” for the companies and help them to track the products in warehouse or store of the companies via barcode or a serial number of the product.
- Apart from using this tracking mechanism, some modern IM products have the capacity to utilize Radio-Frequency Identification (RFID) and wireless tracking technology too.
- “Inventory Optimization” is also an important feature provided by such systems. These products give fully automated demand forecasting to attain inventory optimization metrics including recorder point (threshold point of number of units that should trigger a replenishment order), order quantity (number of units in the inventory that should be recorded), lead demand (lead time selling of units), stock cover (number of days before the inventory gets out of stock), and expected accuracy of the forecasts.
The use of IM software provides several advantages and some of them are described as follows:
- Increased Efficiency: These systems increase the overall efficiency of business by speeding up different tasks. For instance, such systems help to automatically collect the data, conduct the important calculations without errors, and create records for the companies. These activities result in saving the time and increasing the efficiency.
- Cost Saving: Inventory of a company represents one of its largest investments. Using these systems for management help the organization to cut expenses by minimizing the number of unnecessary units in the storage.
- Updated Data: The mentioned software systems provide real-time and up-to-date data about the inventory. Using mobile devices including laptops and cellphones, the company executives can access this data without much delay and this helps the decision makers to make informed decisions.
- Data Security: Modern management systems allow the admin of the system to declare rights for each of its users and in this way, managers can get help from other employees of the company without the worry of data loss or data integrity. The managers can assign different tasks related to order placement, receiving products, and transferring products to different employees.
- Efficient Warehouse Organization: These systems help distributors and wholesalers to organize the warehouse. When the system can provide the list of popular products or those which are more frequently being sold, then these products can be grouped and placed together. Also, to speed up the delivery process, those products can be placed near the delivery area.
Apart from all these advantages provided by such systems, a more precise need of such software products is indicated by IBM reports which say that 54% of major supply chain officers will reduce the cost by optimizing their inventory management techniques. It is very difficult for a company to generate growth and run a profitable business without a precise accounting of how much inventory is in the stock, where the inventory is placed, and importantly, what will be needed to meet the incoming and future orders. Similarly, another article published in Entrepreneur emphasizes the importance of inventory management software for industries and claims that “Companies can increase their profitability 20 to 50 percent or more through careful inventory management”. All these works point to the significance of these software systems for the current industry. As the size of the industry is increasing with every passing day, managing this ever scalable industry state is becoming a challenge for the human hand with pen and pencil. Therefore, it is becoming essential for the industry personals to think seriously of the ways to manage the whole supply chain system. For this purpose, these Inventory Management Software Systems can definitely be a reliable, fruitful, and efficient solution that can not only reduce their workload of management but also can result in cost effectiveness.