Inventory is a most valuable asset of product selling companies and retailers. How well the inventory is managed in a company is the key factor in making or breaking of a business. When one read the news about huge companies and retailers filing for bankruptcy, it’s a pretty safe bet to say but most of those companies if not all have been unable to effectively manage their inventory. Inefficient inventory management burns a hole in the cash inflow statement of the company which often becomes the driving factors in the demise of various companies.
Take the example of a 50-year-old world-famous brand Ralph Lauren. Despite being a very strong brand in the clothing market, their sales have become negligible and their profits have decreased by 50 percent. The company had to close 10% of its stores and it brought unemployment to 1000 people. Not only Ralph Lauren but there are a number of brands which were originally blooming on the old retail model now are closing stores day by day.
The main reason can be attributed to the more intuitive inventory system of the online e-commerce platforms that are trying to replace the retail store business. The tech-savvy and smart entrepreneurs have it all right and they are paving a new way of carrying out retail business. Hence in modern times, there is a strong need for companies to have an intuitive inventory system.
These old brands like Ralph Lauren were using all historical data which were based on past sales and stock outs. The modern day inventory systems are a result of gathering and analyzing of huge amounts of real-time data generated periodically on the internet in the connected world using advanced enterprise software systems and machines.
So in order for the old brands to survive in the increasingly competitive marketplace, their managers need to apply intuitive inventory system in their firm and redesign their whole supply-chain process. Nowadays all orders, products reviews by the customers, transactions, delivery time, manufacturing time and examinations etc are all interlinked with the help of internet. Websites and cloud portals are being used to develop software systems which help in material management by controlling order and distribution of all the products of the company in a very systematical way.
Any data which can help the company in product interactions, which may be derived from the sources outside the company like customers, retailers or business partners can also be made use to further predict the demand for the various products in the marketplace.
While there are still numbers of challenges to overcome, it is evident that intuitive inventory management can be used to make use of all of the data that is becoming available with the rise in connectivity, the computing power and data storage capacity. Change is an unstoppable force of nature and its coming in the world of inventory management and those who embrace the change and apply it soon will largely benefit in the upcoming future. Better collaboration with the customers and high level of coordination in the whole of the trajectory from where the product is manufactured to where it is shipped is the main aim of an intuitive inventory system.