Did you know that 43% of small businesses don’t track inventory? What’s worse is that this statistic only gets scarier when you realize the pivotal role that inventory control plays in running a successful business. In this blog, you’ll discover:
- What warehouse inventory control is and why it’s essential.
- Best practices for inventory control in warehouse.
- The top three inventory processes to automate.
Let’s get into it!
What is warehouse inventory management?
Warehouse inventory management is a critical aspect of supply chain management that focuses on monitoring, controlling, and managing items stored in a warehouse.
It encompasses a range of activities, from tracking products as they enter and leave the warehouse to ensuring optimal storage conditions and space utilization.
Effective warehouse inventory control is not just about counting stock. Instead, it ensures that the right products are available at the right time and in the right quantities. Proper warehouse inventory management:
- Minimizes costs.
- Reduces wastage.
- Ensures timely order fulfillment.
What is the difference between warehouse management and inventory management?
Warehouse management and inventory management in warehouse facilities, though closely related, serve distinct functions in your supply chain. The main difference between warehouse and inventory management is that warehouse management focuses on the oversight and optimization of your warehouse. It ensures that you:
- Track inventory levels properly.
- Efficiently store your products.
- Are ready to dispatch anything in-warehouse.
On the other hand, inventory management encompasses a broader scope, dealing with:
- The overall strategy of maintaining stock levels.
- Forecasting demand.
- Determining when and how much to reorder.
In a nutshell, warehouse management is about the operational aspects of handling and storing items. In contrast, inventory management in warehouse facilities is more about strategic planning and decision-making related to stock levels, ensuring that you meet customer demand without overstocking or understocking.
Why is warehouse inventory management important?
Effective warehouse inventory management is more than just keeping tabs on stock levels. It’s a strategic approach that can significantly impact a business’s bottom line.
Here are the primary reasons to hone your inventory management in warehouse.
1. Improves order fulfillment
Keeping a keen eye on your warehouse inventory ensures you always have the right products when orders come in. As a result, you experience:
- Fewer backorders.
- Reduced delays.
- A smoother fulfillment process.
2. Improves productivity
Efficient warehouse inventory control simplifies your operations and improves staff productivity.
With more organized stock and optimized storage solutions, your warehouse staff pick, pack, and ship items quicker. As a result, you reduce errors and increase efficiency.
3. Faster shipping
With a well-managed inventory system, you also expedite your shipping process.
With organized, accessible inventory, you can process more orders in less time, speeding up your dispatch times and deliveries to your customers.
4. Cost savings
With poor warehouse inventory control, you’re either overstocked or understocked — and both are costly. Holding too much stock ties up capital and increases storage costs, while too little leads to missed sales opportunities and unhappy customers.
Careful, well-planned inventory management in warehouse strikes the right balance, reducing your holding costs and minimizing the risk of stockouts.
5. Increased customer satisfaction
At the heart of inventory control is the end customer. Your customers are more likely to have a positive shopping experience when you fulfill their orders accurately and ship them out promptly.
Boosting your customer satisfaction leads to:
- Increased customer retention.
- More sales through word of mouth referrals.
- A better reputation for your business.
Best practices for warehouse inventory control
By integrating the following best practices into your inventory management in warehouse, you’ll ensure a seamless flow of goods, reduce errors, and maximize profitability.
Use demand forecasting
Anticipate future sales patterns and stock needs by incorporating demand forecasting into your inventory control strategy.
By analyzing historical sales data, market trends, and seasonality, you can make informed decisions about the demand for your product. This tells you how much inventory to hold at a given time, reducing your risk of overstocking or stockouts.
Monitor and improve continuously
Regularly reviewing and refining your processes ensures you stay ahead of potential issues. You can identify areas for improvement and implement changes proactively when you continuously:
- Collect data to map out sales trends.
- Analyze performance metrics and adjust your inventory accordingly.
- Seek feedback from customers and industry experts.
Implement warehouse inventory control checks
Routine checks and audits are essential to maintain accurate inventory levels. By periodically verifying physical stock against your records, you’ll:
- Catch discrepancies earlier.
- Fix errors as soon as they come up.
- Ensure a reliable and trustworthy inventory management system.
Automate warehouse inventory systems
Experts estimate that the global warehouse automation market will surpass $30 billion by 2026, and there’s a good reason for the surge in popularity.
From barcode scanning to advanced software solutions, implementing automation into your warehouse inventory management:
- Reduces manual errors and improves accuracy.
- Speeds up processes and increases efficiency.
- Provides real-time insights into your stock levels, improving scalability.
- Frees you from the chaos of your day-to-day operations.
Warehouse inventory control processes you can automate
It’s clear that automation is the best way to improve your warehouse inventory control, but what areas exactly should you look at? Here’s a look at some processes ripe for automation.
Layout optimization
A well-organized warehouse is the foundation of efficient operations. Automated layout optimization tools suggest the best arrangement of goods for your warehouse based on an analysis of your:
- Storage space.
- Product turnover rates.
- Retrieval patterns.
Optimizing the layout of your warehouse through automation improves everything around inventory control and warehouse management, from finding products easier to creating a more intuitive workflow for your team.
Inventory tracking
Gone are the days of manual stocktaking and tallying. Modern inventory control systems offer automated tracking solutions, from RFID (radio frequency identification) tags to barcode scanners.
Automated inventory tracking tools provide real-time updates on your:
- Stock levels.
- Product locations.
- Movement histories.
These updates ensure your inventory management in warehouse is accurate and up-to-date at all times.
Reporting and optimizing
An aspect of warehouse inventory control that people often overlook is the importance of making data-driven decisions and evolving inventory processes over time.
Automated reporting tools compile vast amounts of data, from sales trends to stock turnover rates, and present them in digestible formats. As a result, you can spot patterns and anticipate challenges to optimize your inventory control in warehouse.
How does a warehouse inventory system work?
A warehouse inventory system is a comprehensive tool designed to enhance warehouse inventory control and management. It ensures you efficiently store, track, and manage your goods.
At its core, a warehouse inventory system integrates the various processes associated with inventory management in warehouse.
It begins with the receipt of goods, where it logs, labels, and assigns your items to specific locations.
As products move through your warehouse, whether you’re relocating or dispatching them, your warehouse inventory system updates in real-time, ensuring accurate stock levels at all times.
Additional features of a warehouse inventory system are that it:
- Analyzes your sales data and forecasts customer demand.
- Automates repetitive inventory tasks.
- Suggests reorder points to prevent stockouts.
Automate your manufacturing workflows with Method
You can’t be everywhere in your warehouse at once, nor should you be. Luckily, I’m here to introduce you to Method, your next employee of the month!
Method is the #1 process automation tool for manufacturers, wholesalers, and distributors that use QuickBooks and Xero. With Method, you save time and aggravation through effective process automation.
By leveraging Method’s intuitive, drag-and-drop interface, you can effortlessly process reorders from your customers and forecast demand for your products.
Manufacturers, wholesalers, and distributors love Method because it:
- Reduces manual data entry and minimizes errors.
- Handles routine, monotonous tasks, improving employee morale.
- Syncs your accounting data from QuickBooks or Xero in real-time.
Get your business back on your side with Method. See how.
Image credit: cottonbro studio via Pexels
