In earlier blogs, we discussed how Procure-to-Pay technology is the building block of effective supply chain management. Today we will focus on how modernizing your inventory management system can help prevent disruption, theft and fraud.
Inventory management used to be a lot harder than it is today. One or more staff members armed with a phone, fax, clipboard, and stack of paper marched the storeroom aisles manually, checking what to restock, and placing orders, one vendor at a time.
Modern automated systems have replaced this manual leg-work.The new way of doing inventory management requires far less time and friction. Many businesses still stick to the old spreadsheets-and-phone-calls system,but it might be time to do something new. One IHL report indicates that inventory distortion worldwide adds up to $1.8 trillion in lost sales — close to the GDP of Canada. Inventory management software aims to lower that number.
New Inventory Challenges Emerge
COVID-19 stretched supply chains everywhere, and companies across many industries are taking note. Hospitality and gaming were both hit hard by the pandemic. Both are bouncing back in a big way — particularly gaming, with the U.S. gambling revenue set to break its $44 billion record. Big companies like Yum! Brands (KFC, Pizza Hut, Taco Bell) are having trouble sourcing ingredients due to increased demand and supply chain crunches. Global shortages and rising costs mean every little bit of margin counts.
Ned Glattly, Managing Director and Leader in Deloitte Consulting’s Supply Chain and Network Operations Practice, weighed in. “The days of inventory being viewed as ‘free’ are long gone … scrutiny over inventory and its role in improving cash flow is a priority in most industries, even where margins have been historically high and stockout-driven losses significant.”
In other words: now is the time to embrace modern inventory management.
How Inventory Management Software Helps
When you start using inventory management software, you get access to automation and an overall understanding of your inventory that you’ve never had with older methods. Our recent webinar, “Champions of P2P: Visibility and Control”, demonstrated how that understanding saves money and increases your staff’s efficiency.
The old method of counting your inventory by hand goes away with barcode scanning, which adds ease for the end-user. That first step of bringing every piece of stock into the system with the barcode scanner enables you to use advanced automation. For those with tablets and a wi-fi connection, electronic count sheets allow real-time count posting.
Par management is an essential element of modern inventory control. When the supply chain is efficient, setting pars at just the proper levels enables you to embrace just-in-time ordering instead of setting back a surplus. With COVID-era delivery disruptions, optimizing pars to account for longer lead times helps you get ahead of the supply chain and prevent disruption to your operations. Automated reporting lets you know when stock is running low, freeing up your time from re-ordering too often or having to spend time looking through the system or physical storeroom to determine whether you need to restock. Having all your vendors linked to your part number lets you select backup vendors quickly should your primary be out of stock or overly delayed.
Theft and misappropriation of inventory are other important considerations when deciding to invest in modern inventory systems. In a non-COVID environment, keeping track of who took what, physical inventory security measures, and whether your liquor pours are accurate are top of mind. However, during these hectic lean staffing days, having a system that automates visibility and reporting of perpetual and month-end variances is key to ensuring these issues don’t get out of hand.
Inventory management software allows you to keep all your information in one place. Our solution, Inventory Management with Accubar, even integrates into POS systems. Whether you’re selling food and beverages, recipes, or even retail items, the system will automatically decrement inventory on-hand across multiple locations, helping you better manage your outlet pars, as well as centrally manage your cost of goods sold. It’s particularly suited to the hospitality and gaming industries, where multiple locations are likely, and POS integration is necessary.
That central management also means it’s easy to generate reports. Getting lost in the day-to-day business makes it easy to lose track of the big picture. Automatic notifications from a capable inventory management system let you track vital statistics like total inventory valuation and overall profits. You don’t have to think about running them — they show up in your inbox on a schedule that’s convenient for you.
In short, modern inventory management lets you see more vital information about your business while streamlining your procurement process. It’s the oil in your business’s engine.
Inventory Management with AccuBar provides all the capabilities we’ve just discussed in one simple, accurate, cloud-based solution. If you’re interested in learning more about automating your inventory management, we’d love to hear from you.