Many supply chain leaders realize they need inventory management systems to cope with increasing orders, customer demands associated with tighter time frames and products traveling across geographical borders. Automated inventory management tools can reduce or eliminate many manual processes, including those most prone to errors.
A critical aspect of this automation is invoice OCR technology. This feature uses optical character recognition to scan invoices, extract data, and automatically input it into the inventory management system. This drastically reduces the time spent on manual data entry and increases the accuracy of invoice processing. It also facilitates the matching of invoices with purchase orders and the tracking of payments, contributing to a streamlined financial workflow within the inventory management process. By incorporating invoice OCR scanning, companies can further enhance their control over inventory and better manage their cash flow.
If you’re thinking about buying an inventory management system for the first time or upgrading the one you have, certain features will enhance your experience. Here are some of them.
Automated Inventory Management Capabilities
A fully or partially automated inventory management system often allows you to achieve more productive operations, including fewer unexpected events. Systems can automatically reorder products once they go below a predefined threshold or alert people that specific items are selling faster than expected, prompting them to restock them.
Many decision-makers often invest in automated inventory management solutions because they recognize shortcomings in their current processes and want to address them now rather than later. Automation can frequently save companies time and money, allowing them to streamline workflows and reduce the need for human oversight on all parts of the process.
Some companies may invest in an automated inventory management solution to handle warehouse parcels. That’s the case with Maersk, which is running an eight-month trial of a mobile robotics unit that sorts, chooses and puts away packages. The goal is to determine the most effective ways to advance how Maersk utilizes automated technology and real-time data-gathering.
Reporting and Analytics Features
Even if a company does not purchase a fully automated inventory management product, the platform will likely have capabilities for automatically collecting data and compiling it for reporting purposes. Representatives can then enjoy better visibility and make more confident and informed decisions while weighing the impacts of multiple options.
A 2022 McKinsey report predicts almost all workers will use data in their workflows by 2025. The content also mentioned how companies would have gigantic networks that collect and process information in nearly real time. Another 2025 prediction in the document discussed the end of silos that can significantly restrict collaboration. Instead, data-sharing platforms will let people share things within and outside organizations by engaging with authorized users.
An inventory management system with reporting and analytics features is an excellent starting point for reaching such a data-driven future. People who can run reports and study associated analytics have an easier time tracking trends and get better visibility into all parts of their operations.
Many inventory management systems have parameters that let people create specific reports with information for particular stakeholders. They can also tweak settings so only the intended persons can view the details, keeping the content appropriately secure.
Real-Time Inventory Updates
Companies use various inventory-tracking strategies to maintain accuracy as demands change. One of them is the ABC approach. It suggests that the most valuable products — encompassing approximately 80% of revenue and 10% of total inventory — are in the A group. There are then further breakdowns for the B and C groups. Whether a business relies on the ABC model or another option, it’s virtually always helpful for employees to receive real-time inventory updates.
Inventory totals that update in real time will give people the confidence to operate without unpleasant surprises, such as unexpected stock-outs. Getting accurate counts is also advantageous when a client wants to purchase a substantial quantity of an item. A representative could verify a company has sufficient inventory before finalizing the order.
People must verify the chosen inventory management system will work with any existing methods or those the company will purchase soon. Fortunately, most are easy to integrate with products from popular brands. Plus, decision-makers can — and should — have in-depth discussions with sales representatives to ensure the solutions they’ve shortlisted will likely work with the technology they already have.
An cloud-based inventory management system enables authorized users to access content from any location. That’s particularly advantageous with more companies having distributed workforces. As many business leaders anticipate and navigate ongoing growth challenges, they often explore how automated inventory management could help.
It’s common to prioritize cloud-based features so people can access data from any device with internet connectivity. That allows for maintaining visibility even when not at a company’s physical location.
About 49% of respondents in a 2022 Loftware survey said ineffective recall management was the biggest risk of not tracking products through their supply chain journeys. However, many now use cloud-based tools that allow them to spot problems sooner and react faster.
Any company using cloud-based systems must deploy access control measures that ensure only people with the appropriate credentials or permissions can see the material. That’s a best practice for any company using inventory management tools or other cloud-based platforms.
Order Management Tools
People should also look for platforms with built-in features that help them provide the information customers want for order-tracking purposes or recordkeeping. A 2022 Verte poll of American consumers found 91% actively track packages, and 39% do it once per day. Moreover, 70% of respondents said they’d rather track packages themselves when orders are delayed rather than rely on customer service representatives to provide the requested information.
The ability to provide downloadable invoices for people to print later is also important. Employees using an inventory management system to distribute digital invoices or allow clients to repeat previous orders could turn people into repeat customers.
Automated inventory management features are also useful in such cases. Imagine a setup that automatically populates invoices with a customer’s address, payment terms and other specifics. Workers could provide the purchasing proof sooner due to not needing manual processes.
Are You Ready to Benefit From an Inventory Management System?
Now that you know some of the most vital features of inventory management platforms, it’s probably easier to envision how your company could benefit from them. Consider your business’s size, kind of inventory kept, average number of orders per day and whether there are imminent growth plans. Ironing out those factors first will increase your likelihood of making a satisfying purchase decision.
Emily Newton is the Editor-in-Chief of Revolutionized Magazine, an online publication that explores innovations in science and technology.