Inventory Optimization or Bust for Growing Distributors

Sage ERP Distribution ERP Software

Give your customers what they want when they want it by taking control of your inventory management processes.

Inventory management refers to a broad concept of how inventory is directed and controlled within a business, the systematic approach to ordering, storing, and using its inventory. Maintaining stock and order fulfillment while overseeing purchases anywhere in the supply chain requires inventory management optimization.

If you’re a growing distribution company, optimizing inventory management processes is a top priority that can ease cash flow concerns and, in the end, save you time and money.

Optimized Inventory Management

You need to know what you need to have on hand to be a successful distributor. Knowing what you need to stock and when is vital to your business, but you first need to understand the speed at which your goods and materials are moving.

The purpose of an effective inventory management system goes well-beyond improving workflows. Optimized inventory processes grant valuable inventory insights allowing you to make the most impactful decisions for your business.

If you’re not using an all-in-one distribution ERP software and instead rely on multiple outdated systems or spreadsheets to get the data you need to make these decisions, then you are at a distinct disadvantage to most other distributors.

By precisely tracking your inventory in a distribution ERP, you’re getting optimized inventory management through a purpose-built system that eliminates the various manual, disconnected processes prone to human error. From this established baseline understanding, you’ll then be able to make considerably better business decisions.

Too many sales, not enough inventory?

Not having enough inventory to meet demand is an unthinkable situation for most distributors, but it happens all too often. The effects of having too little inventory on hand can cripple a distribution company right out of business, especially if you wait too long to fix or prevent the problem from recurring.

When your customers can’t order from you in the quantities they want, you are not only losing money on the individual sale, but you’re also sending your customers to the competition. Once a shopper goes elsewhere, you risk never getting them back.

With the right inventory management system in place, you’re able to spot trends and automate reordering to keep the problem from recurring.

The inventory management dashboards within wholesale distribution ERP addresses this head-on by giving you a detailed look at what inventory you have in stock and how quickly it moves through your operation. Get automatically compiled and ready to view date through visual dashboards that deliver actionable performance metrics, sophisticated forecasts, and recommended items for ordering.

Dreaded inventory surplus

Having a surplus of inventory doesn’t immediately stand out as being too problematic until you consider the valuable warehouse for moving inventory that sells better or new offerings to keep your customers’ attention is unavailable.

Excess inventory often happens as a result of inaccurate forecasting based on erroneous or incomplete data, leaving more stock in the warehouse than market demand.

Beyond taking up space, inventory that depreciates over time means the longer you hang on to dated inventory, the higher your risk of having to sell those items at a loss or worse, toss in the garbage.

The remedy to the inventory surplus and deficit problems that plague many distributors is a keen insight into what you need to have in stock at all times. Implementing an inventory management system addresses this problem by highlighting hot sellers as well as those not moving from the shelves in order to help you eliminate costly, redundant, unnecessary reordering in the future.

Sage 100 for distributor inventory optimization

With features like ‘Just-in-time’ (JIT) inventory management, Sage 100 helps to increase your distribution efficiency by stocking only the products you need when you need them.

Sage 100 lets you take full control of your inventory management processes to reduce surpluses and carrying costs while getting all your orders fulfilled on-time.

If you’d like more information on Sage 100 and optimizing your inventory management processes, contact one of our Sage 100 ERP professionals at (440) 352-4700 or click here to contact.

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