If you have ever been to gigantic retailers like Walmart, you can without a doubt see the gigantic quantity of various things being stocked at the racks. These items are from all over the world and worth billions of bucks. To be able to effectively keep this level of inventory, it is imperative that a company needs to have an effective inventory software.
By using an efficient stock control system, Wal-Mart, for instance, is able to preserve its signature “day-to-day affordable price” since this enables them to communicate with the shop managers regarding which products are marketing and which are simply taking up rack as well as stockroom area.
THE POPULARITY OF INVENTORY SOFTWARE
Huge businesses are generally using inventory monitoring systems, although smaller company use these digital solutions as well. By employing an inventory management system, customers will always have enough of what they require as well as have the ability to stabilize that objective with the seller’s financial demand to ensure that they will have the ability to maintain minimal degrees of stocks. If inventories are not being managed well enough, this results to disappointed customers, there are too much cash that is tied up in the warehouse and slower sales. Factors like faster production cycles, the spread of products, multi-national contracts, and the nature of the big-box store make inventory management software a necessity.
These modern inventory management systems must also have the ability to track sales and inventory availability. It should also be able to communicate with the supplier with almost real-time and be able to receive and incorporate other data, like seasonal demand. The system should so be flexible, which will allow the vendor’s intuition. The inventory management system should also be able to alert the businessman when to reorder and how much to purchase.
There must be an inventory management system in place to pull together several technologies into one cohesive approach to achieve this. The constant beeping of the bar codes that are being scanned at the check-out counters is the epitome of the modern inventory management system and that is stock tracking.
During the early days, merchants were writing down purchases, or the check at how many units was used or sold at the end of the day and then they did their best to forecast their future needs. The key skills were experience and intuition, but still, it remained as an inexact method.
Efficiency and mass production has become the main goals of business after the Industrial Revolution, together with improved customer experience at the point of sale. The first modern check-out system was designed by a team at Harvard in the early 1930s. The system used a punch card that corresponded with catalog items. However, the system was too expensive to use, but still, there are some stores which are using this version where merchants place cards with product information on the aisle so the customers can select and then bring it to the checkout line.
In the 1960s, the development of affordable laser technology has been revived. The lasers allowed for smaller, faster and cheaper readers or scanners. The modern bar code or the Universal Product Code was born just before the 1970s, and as the computing power become well, the power of the Universal Product Codes in helping track and manage inventory has exponentially improved.
RFID – A PROMISING INVENTORY SOFTWARE FEATURE
There is also another promising technology for tracking inventory, this is the radio frequency identification which uses a microchip to transmit product information like the type, the manufacturer and the serial number to the scanner or to other data collection device. The radio frequency identification is superior to bar codes in several ways. This also can encode more data as compared to a bar code and in some systems this even tells merchants if an item is out of place in a store, thereby providing it with an excellent anti-theft characteristic.
One other popular means of automated inventory control is vendor-managed inventory. With this kind of arrangement, the vendor is responsible for keeping its product stocked on a store’s shelf. Here, the vendor and the retailer are working closely and share proprietary information.
There is specialized software that keeps track of how much stock is going out of the door through purchases and with how much remains on shelves and in the warehouse, thereby giving managers a real-time picture of what is happening. This software also analyzes the data and then makes recommendations for the re-ordering schemes. There are also times where they program the system to automatically order at a certain point. It is important to note, that good systems leave room for human decision-making. The system will then provide good information to be able to support your decisions but still leaving the final call to the managers.
Once the managers make a re-order decision, the system will use electronic data interchange to communicate its needs for additional merchandise to a vendor. The electronic data interchange is the process of sending and receiving data between two parties, that is a retailer and a vendor, for example – and by using data transmission lines like the internet.
Most of the retailers are buying into the vast advantages which are offered by such systems. This is also because they include high efficiency, the need for less warehouse space, less cash being tied up in inventories and better sales performance. The systems will also promote better information sharing that is between the retailer and the vendor. This will help drive down costs for both, including the consumer.
The advantages of the presence of modern inventory systems are not just for the retail as well as manufacturing sectors. These systems additionally use wonderful advantages for any organization that takes care of a supply chain for fungible products.
The main function of the inventory management systems is to ensure that the stocks exist when and where it needs to be. The arrival of the inventory monitoring system has provided business owners the capability to be extra in control of the activity of their items, therefore enhancing not just their organization efficiency but also consumer fulfillment.
