Inventory management software

What is inventory management software?

Inventory management software helps a business to obtain an overall picture of inventory at any given time. It records all data about what inventory, stock or raw material is sourced, stored, ordered, sold and shipped in manufacturing, wholesale or retail environments. By having accurate measures of stock enables people to plan, manage cash flow, supervise the flow of products/materials and improve the quality of customer service. Inventory management software collates many layers of data and integrates with ERP systems.

What types of data can be analyzed?

Purchasing data is added to inventory management software so the cost of the raw materials or products can be reviewed, compared and cross referenced.

Sales data is essential so business people can determine the most profitable inventory mix and what inventory or stock is in demand. By reviewing sales data a business can optimize inventory management by knowing the correct amount of inventory that needs to be held for each product line so a business can fulfil all orders without holding too much stock on hand. 

Sell thru data is analyzed when distributors sell products through retailers so rely on third party data to determine how products are tracking. Many businesses add this external data into the inventory management software so it can understand product preferences in different channels.

Supplier data is also included in inventory management software so a business has full visibility of all suppliers so strong relationships can be forged and enhance the efficiency of the supply chain.

Finance data from the ERP system helps the inventory management system to accurately determine the value of the stock currently on hand. Read the Johnstone Supply case study.

What industries use the software?

Inventory management is essential in industries where products are made, moved and sold via wholesalers, online or direct to consumers because the raw material or product costs represent a substantial portion of operational revenue. 

Manufacturers use inventory management software to reduce waste, manage cashflow and to scale-up a business into new markets. Read the Sistema plastics case study.

Wholesalers of all products use inventory management software to manage its key assets -  stock. Wholesalers often have thousands of stock keeping units (SKUs) to manage so need the software to create an orderly flow of goods and operate profitably. Sometimes, vendor managed inventory (VMI) is a supply chain agreement where the supplier takes control of the inventory management decisions for the retailer. Read the American Metals Supply case study.

Retailers use inventory management software to reduce costs and improve customer service. Retailers often have different demand across  seasons, so they rely on forecasting inventory levels accurately to meet demand at the appropriate time. Read the Hairhouse case study.

eCommerce can be a hybrid set-up where some operators might not physically manage their own inventory but whether stock is managed or not, eCommerce businesses need to ensure critical inventory levels are kept up to maintain demand. Read the Hein Electric Supply case study.

Why inventory management matters?

Effective inventory management can often be the difference between staying competitive or not. Good inventory management software enables a business to automate inventory control reducing errors and costs. By keeping track of which products are on on-hand or ordered, there is no need for ad hoc inventory counts because the software allows you to know what products are available in real-time, saving lots of time. Inventory management software identifies slow-moving products, measures key inventory calculations and metrics and helps to retain customers because a business can give them certainty that products can be delivered on time and in full.

Key benefits of the software

The benefits of inventory management software flow to both employees and customers. With inventory management software, inventory can be tracked at every step of the process which makes the role of inventory and sales managers more efficient and they can concentrate on better serving customers and providing more accurate advice about stock levels and locations.

Having inventory, customer and product data in one place and being able to analyze it quickly helps track product ordering patterns, which in turn can help avoid missing opportunities or challenges. People can monitor which products key customers are buying, avoid deadstock or overstock situations and enhance data security.

Deadstock and other problems 

Poorly managing inventory can eat through your cash flow quickly so it's important to not let inventory get out of control because it can negatively affect your bottom line and stunt business growth.

There are many telltale signs of poorly managed inventory including a perpetual higher cost of inventory and storage, greater likelihood of deadstock, lost customers due to a high level of inaccuracy and problems with orders.

Key features of the software

Cloud based inventory management software will help grow a business while maintaining an efficient warehouse. Key features of inventory management software include real-time inventory tracking which helps to build strong relationships with customers, enables accurate forecasting by having access to information about sales trends, best-selling items and customer behavior. A business can work more effectively with suppliers and determine where there are problems or issues in the supply chain and eradicate them.

Increase ROI

The most common ROI elements for inventory management software are reduced overhead costs as inventory turns over more quickly, improved order accuracy which saves on returned inventory costs, efficiency gains because inventory is managed in real time, saving employee's time checking for stock and chasing stock between warehouses, and inventory accuracy will improve. There will also be many intangible benefits because your staff will feel better and more in control of the inventory.

Phocas software is industry-specific

Manufacturers, wholesalers and retailers choose Phocas inventory management software because it has a low barrier to entry, and they can get results to adapt to market changes quickly. Phocas integrates with specific ERP systems the market already uses, which saves on implementation time and set-up costs.  The feed of data into the system is automatic and includes security.  The intuitive user interface allows all people to easily set-up inventory calculations and track KPIs. Phocas encourages customers to have different divisions like sales, purchasing, and finance all using the one inventory management system which is appealing to mid-market business because running different software for different functions is neither desirable nor efficient. 

Resolve inventory problems

Managing inventory is not easy but implementing inventory management software can make the process more streamline and help alleviate many inefficiencies. Issues like order inaccuracies, deadstock, stockouts and loss of customers will be prevented. Your people can free up their time by having certainty about stock levels, not needing to chase stock in different locations or take calls about their stock levels, so they can better service customers and manage suppliers. If inventory continues to be managed via manual processes and using spreadsheets the business is unlikely to cope with growth or take on new products or customers.

Why choose Phocas software?

Phocas software is easy to use and helps people to anticipate and adapt to inventory changes as well as measuring the performance of suppliers. Phocas software is flexible, so a business can start by analyzing one data set and then add more as the business expands. The built-in dashboards allow everyone to quickly understand the inventory situation and act with confidence.

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