Real-Time Inventory Management

In today’s fast-paced retail world, having real-time inventory management is crucial. Often, one of the most complicated parts of running a business is tracking inventory, so you need a solid strategy to master this element. With real-time inventory tracking, you can instantly monitor, manage and track your products. Knowing how important inventory management is, there is a rising demand for software that can do just that. Having these tools is important if you want your business to excel in the modern world. Read along to learn more about the importance of real-time inventory management in modern business.

What Is Real-Time Inventory Management?

What Is Real-Time Inventory Management

So you’ve set up your business and have just the right products that customers need. Next, you need to think strategically about how much of this stock will be used and when. Suppose your product sees a demand surge and now you’re out of stock, this could risk your customer relationships. Real-time inventory management will keep you updated on your stock levels so you never have to deal with this problem. With real-time inventory management, your system records every transaction instantly instead of updating the data at regular intervals. This way, you’ll have accurate information and will know what steps to take for a more efficient supply chain. Real-time inventory data also reacts quickly to any disruptions or sudden changes that could target your workflow.

Why Do You Need It?

In the modern retail landscape, things are changing fast, so it’s crucial that businesses remain dynamic. Modern inventory management is necessary because it helps you track stock levels and the movement of products as they happen. Think of it as a vital building block upon which you will build and grow your business. A solid inventory management strategy will help you maintain stock control, improve customer relations, and boost profits. You’ll have a streamlined supply chain with all your inventory in order. Without it, you risk shortages, disorganisation, wastage, and so on. Inventory management will also give you an edge over other ecommerce businesses. Once you start with stock management software, you can build a solid foundation for your company’s growth. Modern inventory management tools offer integration with other tools such as POS (point of sale), shipping and online store management. With these functions, you can create a retail store unique to your business needs.

What Are The Different Components of Real-Time Inventory Management?

Real-time inventory management instantly records inventory purchases and sales through the software. This feature allows your business to understand and track stock movement in real time. With this information on hand, business owners can take proactive steps to maintain their supply chain and stop problems from popping up. Since this data is gathered in real-time, whichever software you use will have several components that record and track stock information. These are often called automated data collectors and are necessary for stopping bottlenecks and decreasing lead times. Understanding these components will help you take charge of your inventory management. Let’s take a look at some common components you might find.

● RIFD Tech: Modern-day inventory often uses RIFD tags to capture data and send it through radio waves. All the data captured with RIFD tags is accurate, making it a great feature for real-time inventory tracking.

● Barcodes: Barcodes are another great way to tag and organise your inventory. Each item in your stock is given a unique barcode, so there’s no chance of mix-up. With this feature, you can check your stock movement with razor-sharp accuracy.

● IoT Devices and Sensors: Apart from collecting real-time data, these sensors are also good at finding data crucial for keeping perishable items in good condition.

5 Benefits of Using Real-Time Inventory Management

Whether you sell directly from one online store or use multiple sales channels, your inventory is constantly moving around. To track and manage this movement efficiently, you need to have a robust inventory management system. Without real-time tracking, you could fall behind on your order processing, not know when to replenish stock and cause longer lead times. If you’re looking to upgrade your stock control, here are 5 benefits of using real-time inventory management for your business.

1. Better Control of Your Inventory

One of the biggest benefits of real-time inventory management is more control over your stock. With accurate and quick data, you know exactly where your products are and where they will be going. You can track their movement in real-time to make sure the supply chain runs smoothly. With this data, you can always keep your customer in the loop about their deliveries, building trust and loyalty with them. Real-time information lets you scan the warehouse floor to start preparing items for packing and assembly. Your data also tells you how much inventory you’ll receive, how much you have and what items are being prepared to ship. This will allow you to make quick business decisions and restock in case of low supplies. Many 3PLs are designed to help you with real-time tracking. For instance, Meteor Space utilises state-of-the-art WMS software that provides accurate data tracking and efficient order fulfilment. With this software, you can see which SKUs are performing well or track the journey of products from the warehouse to a customer’s doorstep. The best part is that all this data is in real-time, so you won’t have to worry about any delays.

2. Optimised Supply Chain and Workflow

Even the smallest hiccup in your supply chain can cause ripples of disruption in the workflow. The great thing about real-time inventory management is that it prepares for these problems. When you get instant data, you can easily identify problems and take quick action to remedy them. For example, you’ve got an order for 200 units of stock but only have 150 units on hand. Real-time data will let you know about this beforehand as you start packing and packing. This will allow you to order more units with the supplier and meet customer demand. Inventory management depends heavily on how your supply chain works. From warehouse shipping timelines to production lead times, all stages need accurate data to move forward. Real-time inventory data gives you key insights that help every team member stay on track. With this information, you can reduce inefficiencies and improve overall logistics and workflow.

3. Maintain Current Records; Avoid Inventory Shrinkage

If your business deals with high stock volumes, you are at a higher risk of inventory shrinkage. Inventory shrinkage refers to the loss of stock or inventory due to damage, theft, vendor fraud, faulty records, cashier error and more. The term shrinkage specifically refers to the recorded inventory versus the actual stock. Having real-time inventory data means that all your recorded information is accurate. Without the right technology, you’ll have less inventory visibility and could face profit loss and low customer satisfaction. With an integrated WMS, you will always have up-to-date information and maintain full visibility of your product’s movements.

4. Plan and Prepare For Demand

Consumer demand is always fluctuating, which makes it difficult to pinpoint how much inventory you need. Still, it’s better to stay prepared in case of high surges or light seasons. With real-time inventory data, you can plan your stock and keep it according to past trends and historical data. All this information will help you calculate the optimal amount of stock to keep without overpaying your suppliers. You can also avoid overstocking and letting items go to waste. Many inventory management systems allow you to set automatic reorder points, which makes stock control much easier.

5. Better Customer Satisfaction

A business can only achieve growth if it maintains a loyal customer base and attracts new people. The best way to cultivate this relationship is by offering reliable service. Real-time inventory makes it possible to maintain an efficient supply chain and low lead times. With efficient service, you can get your products out faster. Additionally, real-time inventory data reduces human errors during picking and packing. Not only will your customer get their products on time, but the items will also be in good condition. Another great way real-time inventory data helps you is by meeting high demand. You can see which items have high orders and ensure that you have enough in stock. With real-time information, you make data-driven decisions regarding your inventory and avoid costly errors.

Ways To Manage Your Inventory

Once you apply real-time inventory management, you can use several other stock control strategies to upgrade your workflow. Inventory management strategy alongside real-time data will help you take better control of your supply chain and create an efficient fulfilment process. Here are great tips to help you get started.

1. JIT Method

In JIT or the Just In Time method, you only order the number of items you need, exactly when you need them, maintaining steady rotation in your inventory. With this method, the volume of your inventory more or less matches the number of orders fulfilled. The key philosophy for JIT method is being able to meet customers demands but also being able to quickly order more stock for the next set of orders. This stock control strategy was created to increase efficiency, cut inventory holding costs, and reduce waste by purchasing only products that were sure to sell. However, several factors, including a streamlined supply chain system and fast delivery, are needed to maintain this method. The JIT method can also fail due to several outside disruptions, such as sudden demand surges, supplier unreliability and natural disasters that can halt supply chains. Such problems can create costly hiccups, compromising product quality and decreasing customer satisfaction. Despite its potential problems, the JIT method is an excellent way of controlling your stock and making sure it stays in rotation. This method reduces storage costs, enhances operational efficiency, reduces waste, and improves your business finances. The constant turnover of products also ensures all items are of excellent quality and are relevant to customer demands. Before you consider the JIT method, circle back to our first tip about looking at stock trends. The key to a successful JIT system is predicting customers’ demands. Once you have this date, you’ll have a better idea of what products to order and how much of them are needed.

2. FIFO (First-in, First-out) Method

True to its name, FIFO, or first-in, first-out, is a warehouse management strategy in which the first products to enter your warehouse are also the first ones to leave. Think of the “first come, first served” mentality regarding your inventory. When using FIFO for your business, you should consider the product’s lifecycle for better results. Apart from that, the strategy itself is straightforward: the products you receive first tend to expire or become obsolete easily, so they must be sold or acquired first. You must keep this cycle going to keep stock value high and prevent it from becoming unsellable. Meteor Space’s innovative warehouse management system gives you a bird’ s-eye view of your entire stock and key insights to help you master the FIFO method. With a fully responsive design and detailed information, you’ll know how to make the best decisions for managing your stock.

3. Safety Stock Approach

With supply chains, you never know when there will be a sudden surge in product demand. Similarly, you can never plan for outside disruptions such as natural disasters, labour strikes, and so on. Facing inventory shortages during these situations can really hurt your business. That’s why many online retailers often keep safety stock in hand to stay prepared in any situation. If you’re unsure how much safety stock to keep, consider your maximum and average daily output. This will help you understand how much stock to hold and when.

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