Are you using inventory analytics? Here’s why you should be.
Earlier this year, the website Retail Touch Points released some interesting data that is quite troubling:
“A new study reveals that only 34.7% of wholesale supply chain executives say their current inventory planning process provides actionable insights on customers, inventory and demand — and that they are fully using those capabilities.”
That’s a scary stat. For businesses in manufacturing, distribution, and retail that rely on their supply chain to make their business work, not using inventory and demand analytics is a serious problem. Missing crucial metrics and measurements in the warehouse is a costly choice.
Why do so few of these businesses use inventory analytics? Many executives and planners don’t know they’re available. Until quite recently, these actionable insights required extremely expensive software systems that only made sense for the largest of businesses.
But in the cloud software era, these incredibly helpful tools are now available to companies of all sizes. The key is educating the executives and decision makers in supply chain businesses that there’s a better way to manage inventory and demand planning.
For smaller and mid-sized firms, inventory management and demand planning tend to be done within an ERP and with an inventory spreadsheet. Unfortunately, these tools simply don’t provide the needed visibility into the health of your warehouse. You need a tool that helps you create a viable safety stock policy, data-based demand forecasts, and smarter purchase orders.
Digging a little deeper, problems like excess stock, stock-outs, and potential stock-outs are easy to miss when relying solely on an ERP or a spreadsheet to manage your inventory levels. Manufacturers, distributors, and retailers of all sizes need a way to find and reduce these problems. And every day that you don’t address them, profits and productivity are hurt.
Some businesses are simple enough to get by without analytics, but the modern supply chain that most businesses deal with is just too complex to manage the old way. The correct tools are crucial to getting the job done properly and on time.
Given all that, here are a few questions for you and your company:
- Do you use inventory analytics?
- What tools do you use to manage your demand planning and inventory levels?
- Do you know how much excess stock you have on hand right now?
If these questions highlight some potential issues in your warehouse, it could be time to see what tools are out there. Replacing manual systems and processes with automated alternatives is the first step toward inventory optimization. Sage Inventory Advisor, with the simplicity of cloud-based deployment, helps manufacturers, distributors, and retailers leverage the power of big data, forecast accurately, and improve profitability.
Want to know more? For more information on how Sage and Sage Inventory Advisor can help you manage your inventory planning process, call MicroAccouting at 1-855-876-3773.
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