The world of business is littered with challenges and efficiently managing inventory is one of the biggest roadblocks in any company’s success. For most small and medium businesses, inventory or stock grabs the lion’s share of investment. Maintaining a delicate balance between supply and demand within a business is essential, so that you always have the right amount of product to make a profit.
Before we step into the top five advantages of inventory management, here is a ready reckoner of the definition. ‘The process of ordering, storing, using & managing the inventory of any organization is known as inventory management.’ Let’s dive in.
- Reduced Operational Expenses
Carrying excess inventory causes major losses to any firm and the costs consist of all the expenses a company incurs for owning inventory. These expenses include the cost of capital, storage and risks costs (including obsolescence, damage, theft and deterioration) plus the appropriate taxable amounts. Maintaining an optimum amount of inventory drastically reduces operational expenses and inventory carrying costs.
- Increased Visibility and Lower Labor Costs
Inventory management applications offer more data granularity, and at more points in the supply chain. The result is increased business intelligence that helps inform your decision making and optimization of the supply chain from the warehouse to the storefront.
- Better Reporting & Analysis
Consolidated reports available through central dashboards offer many advantages. These include centralized analysis and comparison of functions across departments, versus everyone showing up at meeting with their own spreadsheets.
- Improved Customer Service
With centralized inventory information, from current sales and order management to service histories, sales teams have more time to focus on customer acquisition and retention.
- Data Security & Access
Modern inventory management tools offer secure access with user restrictions on a ‘Need to Know’ basis. This reduces the chances for data loss or leakage. Additionally, with cloud backups and secure hosting your confidential and highly volatile client data is protected at all times.
If you would like to learn more about how your business can benefits from better inventory control, get in touch with us here at AdvancePro.