Inventory management directly relates to the sourcing, storing, and selling of stock. Inventory Management also includes the tracking of raw materials needed to produce finished goods. It may seem easy, but the larger your business is, the more complex it can become.
Your company’s specific inventory management definition will depend on the industry and the channels through which it sells, and the raw materials required to make finished goods. Inventory management embraces data, everything from tracking purchases you make from distributors, maintaining stock, and determining how much inventory to sell at what price, all while fulfilling orders from customers. Inventory management should provide an accurate and appropriate amount of stock in the right place, at the right time, for the best price for you and your customers.
Using an inventory management system is one way you could enhance your business. It can help you monitor end-to-end supply chain processes, analyze lead times, and forecast demand for products and services.
Inventory accuracy is vital for high-quality fulfillment of your products and services. Without it, you may misplace inventory, have the wrong number of products on balance, or have incorrect lot numbers. This means it’s that much easier to deliver the incorrect products to your customers. Without an accurate inventory, you can’t properly track order fulfillment, prepare for expected demand spikes, or know when to order more supplies. Make sure to consult the accompanying infographic below for more information about the importance of a balanced inventory management system.
Infographic created by WSI, a warehousing services provider