When it gets down to it, Inventory Management can either make or break a company by providing large profits or large losses. Inventory; which can track anything from products a company wishes to sell, to products like pens, paper and computer equipment used to keep a company running; efficient inventory controls are a necessity in business management and assist in keeping a company organized and essentially more profitable.
Inventory Management is the compilation of a list of products in raw material, finished good, or work in progress state. These products are most likely stored in a warehouse and are tracked by item name, description, location, and on hand counts. With these lists, it is easier to tell which items are in stock, selling the fastest, need to be replenished and are not used. This form of information technology can help make a company much more efficient and reliable for their customers.
Companies like Walmart use technologically advanced inventory management systems to track their inventoried items. This system is called SMART, which uses a wireless and handled device equipped with a barcode scanner and RFID to maintain inventory levels. After scanning an item, this device can pull up every bit of information stored in the main computers database regarding that specific product. Not only that, it can provide the on-hand counts for the product in that store specifically and other stores worldwide if needed.
For a company to take charge of their customers’ demands against a suppliers capabilities is a difficult task to assess, however, with proper inventory control supplier inventories and deliveries compared to customer request and orders can match equally making both sides of the spectrum happy. Stocking too much of a product or too less of another can lead to huge losses in business which is why proper inventory management is a necessity for companies with large customer databases or large inventories.
Like Walmart, Biotium “a leading provider of products for life science research” has implemented an intelligent new software system meant to streamline inventory controls for the thousands of products carried at one time. Sage, a company versed in business management software, has made it possible for Biotium to create production work orders for items which have dropped to set parameters. This means, when product A reaches it’s stocked parameter of 10 available, an automatic production work order is created and emailed to technicians so they can begin production on a new batch before the 10 sell out. With this form of intelligence, Biotium reduces its risk of backordered items and customer loss.
However impressive efficient inventory management can be, it cannot be effective unless all sides of the supply chain are participating in their own inventory and organizational management protocols. With this said, everyone from suppliers and their distributors to distributors and their suppliers need to have good communication with each other and good inventory and organizational controls to keep items in stock, available and off backorder. This will not only make the customer and company happy, it will keep the supply chain processes moving smoothly with minimum kinks.