No matter how sleek and user-friendly your e-commerce website looks on the front-end, optimizing your back office operations is what ultimately accounts for the excellent shopping experience and top-notch service your customers will surely appreciate. In retail, everything is interconnected. When it comes to streamlining operations at your retail back-end, improving your warehouse inventory management is imperative.
Here’s how to tell if you’re warehousing processes are in desperate need of automation:
– you are constantly running out of stock (especially during holiday season)
– you are unaware of the actual stock quantities
– you have trouble tracking items across different warehouses and forecasting inventory needs.
But, most importantly, using manual processes to manage your inventory database is a major indication your retail business is (or will soon end up) in a tight bottleneck.
Industry insiders report, over 45% of SMB companies use manual inventory tracking or don’t track warehouse inventory at all. While this approach may be justified at the start-up phase, as business expands, errors and inaccuracies also start to pile up exponentially. The fallibility rate grows, but there’s no practical use in blaming it on your employees: after all, they are only human. As your business grows, automating inventory management is the next logical step towards optimization and better management.
Inventory Management Automation Benefits
Admittedly, inventory management is a constant balancing act. On the one hand, you must always have ample supply of your best-selling products, on the other hand, you have to ensure your unsold stock isn’t lying around occupying shelf space. As of today, even top public US companies have trillions of dollars of working capital tied up in inventory, not to mention SMB companies, who need urgent solutions to tackle their inventory needs.
Here’s what advanced AI tools can do for your business:
– Real-time stock counts. Automated solutions keep you always informed of stock quantities, help you forecast demand and plan supply. Moreover, AI-based tools will sync your inventory database with sales data, deliver business insights and generate reports and sales forecasts.
– Top-notch accuracy. Automation will completely remove the human factor, so you can rest assured, there will be no more frustrating mistakes. No accounting errors and no taxing issues as well, for that matter.
– Instant synchronization. Juggling between disparate databases is, arguably, the most daunting thing about managing retail back-office processes. Inventory management solutions will automatically sync with all your databases across other business-critical operations like shipping, accounting, and payments.
Apart from saving time and optimizing staff expenses, there’s also a financial benefit: getting rid of unsold stock will ensure no money are tied up in unsold inventory.
Most SMB companies have no time and expertise to develop their own Inventory management tools in-house and usually turn to software vendors or third-party companies to develop these solutions for them. At VARTEQ we value individual approach. Before we start developing middleware solutions for your organizations, we guide you along the process of determining your business needs, choosing the right technologies and architecting custom-made software aimed at tackling your business-specific problems.
Yet, before you turn to a third party company to develop your inventory management software, here’s a number of things you can do:
1) Organize your inventory
Start with the basics: organize your warehouse inventory using the tools you have at hand. Even if it’s a manual Google Docs database, start bringing it to order. Count and categorize your stock, so that you know exactly how many physical items you have. If your business uses a number of different warehouses this could be a tricky task, but accomplishing it will make you well prepared for implementing automated systems.
2) List your existing databases
Running an e-commerce business involves using disparate databases for each process: purchase quantities, stock orders, shipping, and delivery. List all of these databases and start with pinpointing the interdependencies between them. Even if you have no expertise in developing your own inventory management tools, you can make the first steps towards integrating your databases, so you won’t be unprepared as you approach your AI solutions provider.
3) Identify your challenges
What are the biggest problems your e-commerce business is currently facing? Are you often out of stock? Are you having trouble forecasting product demands? What are your most pressing performance bottlenecks? Have the answers to these questions at hand before talking to an AI solutions provider.
Businesses are adopting automated AI solutions at a head-spinning rate. At this point, it’s hard to tell which is potentially more dangerous: not using AI at all, or failing to use it correctly. Incorrect implementation of AI software may disrupt your business ecosystem and dramatically slow down your operations resulting in revenue loss. Under these circumstances, careful assessment of business processes that need automation and the right choice of AI solutions provider will have a crucial impact.