You find yourself staring into the face of something all too familiar. Once again, your shelves are overflowing. You have tried a fair remedy: halt production. But now you find yourself running out of stock and facing a mob of angry clients.
The problem may lie with your inventory management systems.
For optimal manufacturing management, the product should be the bedrock of success. Improper product management is the breeding ground for chaos.
This article will explore inventory management, including its top seven benefits.
What Are Inventory Management Systems?
Inventory tracking is as old as trade. Back then, all merchants had where tally sticks to track their stock. But today, retailers, manufacturers, and just about anyone in the product lifecycle enjoy seamlessly engineered cloud systems with impressive capabilities.
Even with the evolution, inventory management systems still carry the same basic principle they did back then. They are systems that record and track products within a company's production network.
There are four significant types of inventory management:
- Just-in-time management (JIT)
- Economic Order Quantity (EOQ)
- Materials Requirement Planning (MRP)
- Day Sales of Inventory (DSI)
Finding which system best fits your company will depend on the product and position in the lifecycle.
If you are a manufacturer with an MRP system, Statii is your inventory answer. Our management system is developed with small to medium-sized businesses in mind.
The Benefits of Inventory Management Systems
Inventory management is vital to happy processes, employees, and clients. But when ERP meets MRP, then magic happens. We are no longer just talking about happy processes.
1. Inventory Automation
Inventory automation systems like Statii help manufacturers track their inventory in real time. This allows manufacturers to know their inventory levels as stock is being used.
And when you employ Statti, you will have access to our simple inventory overview designed to help you save time and money. This MRP software will give you accurate inventory insights. And since it's cloud-based, you can access your insights from anywhere.
The minimum stock level feature will alert you when inventory levels run low. But we didn't stop there. This manufacturing software will provide suggestions on how you can fulfill live orders.
2. Reduced Inventory Costs
You cannot work with inventory management systems and not experience reduced costs. At the core of an inventory management system, you will find two distinct benefits: reduced overstocking and automation. Both these benefits work to cut costs on the shop floor.
When it comes to overstocking, an automated system will help you reduce it by revealing inventory levels. We can look at overstocking as meeting a demand you don't have. And when you make an investment that doesn't have immediate market demand, you are locking money you could otherwise use for other activities.
Another benefit we celebrate from inventory management is how it reduces the margins of error. Manufacturers armed with an inventory management system experience fewer inventory mistakes. This will eliminate the need to employ money to fix those mistakes.
While small manufacturers also worry about the initial cost of employing these systems, others invest in Statii. We designed Statii to meet the demands of small to medium-sized manufacturers without blowing their budget.
3. Improved Productivity
Another reason we applaud MPR software is increased productivity.
Without inventory software, manufacturers must manually handle several aspects of their operations. This can lead to serious downtime. Some manufacturers may try to remedy this by increasing labor. But this only increases their financial demands.
Businesses with an inventory management system have a different experience.
An inventory management system leads to higher production rates. Manufacturers can redirect their time and labor to other tasks without needing a manual approach. And armed with the right amount of inventory, businesses can meet market demands.
4. Data Security
Inventory management systems allow manufacturers to restrict inventory access. With this feature, you can decide which personnel can access your inventory or even give them as needed.
By reducing inventory access, you guard against data breaches. This tactic will also work to help you mitigate potential leaks.
5. Increased Customer Satisfaction
Customer satisfaction remains one of the most critical cornerstones of business. It is how you guarantee repeat clients.
In their latest report, the UK Customer Satisfaction Index revealed that customer satisfaction has reduced by 0.7. This number is lower compared to what we saw in 2022.
One of the solutions they highlighted to improve customer satisfaction in the country is focusing on customer needs.
An increased attempt to fulfill orders faster and reduce the wait time is a great way to achieve this. And that is what the right inventory system can do for you.
Backed by accurate inventory, redirected labor, and reduced costs, businesses can operate efficiently. This will help them meet customers' needs and inspire brand loyalty and trust.
6. Improved Forecasting
Another significant benefit that is often underappreciated is forecasting. An ERP MRP inventory management system will provide you with detailed inventory reports.
These reports can help you understand inventory trends for your company. For example, a detailed inventory report will show you which components you use often.
With this insight, you can better predict which stock you need more. This will provide you with more accurate stock forecasting.
7. GAAP Compliance
Inventory management systems don't only ensure that you meet customer demands. These systems also play an essential role in guaranteeing compliance with the UK GAAP regulations.
The GAAP regulations are accounting rules established by the Financial Reporting Council or FRC. These rules state that to measure inventory, you must calculate it at "the lower cost and estimated selling price fewer costs to complete and sell."
For this reporting accuracy, you must have accurate prices for your inventory. This is where your system comes in. It can provide you with the actual costs of the stock you carry.
Investing in the Perfect Inventory System
When it comes to business efficiency, investing in the perfect inventory management systems is vital. The right system for your company will ensure increased productivity, better forecasting, reduced costs, and compliance.
If you are on the hunt for the best ERP manufacturing software, Statii can help. We have developed a manufacturing software for companies of all sizes.
Start your 14-day and see exactly what Statii can do.