One of the most dramatic consequences of the COVID-19 pandemic has been the upending of business processes we took as expected. These processes include supply chain planning, inventory planning, and material distribution operations. Unfortunately, all of the aforementioned procedures have come under strain due to the pandemic.
Therefore, now, more than ever, consulting with inventory management services is vital for businesses. Speaking to a consultant can help your business navigate these uncertain times and optimize the value of your inventory.
Inventory management entails managing and overseeing many aspects of business operations. This includes supply chain planning, warehousing processes, procurement, material flows, quality assurance, and customer satisfaction. In essence, inventory management is concerned with every stage of the product life cycle. Additionally, every component in inventory management is linked. For example, a problem with warehouse management can easily lead to miscalculating inventory levels, which can result in overstocking or understocking.
Thus, should your business speak to an inventory consultant, every aspect of inventory management will be discussed to aid inventory optimization, process efficiency, and reduce costs in the long term!
Alternatively, businesses can also use consulting services or consulting companies that focus on specific areas of inventory management (examples include warehouse management, project management, and supply chain consulting.) When speaking to consulting organizations, they can help determine which areas of inventory management companies should focus on.
Reasons You are in Need of Inventory Management Consultants
Managing inventory can be difficult even at the best of times. If your business has not spoken with inventory management consulting services, problems might arise.
Understocked/Overstocked Inventory
Businesses must prevent both understocking and overstocking to keep their profit margins strong. Some companies can struggle with understocking, meaning they lose out on potential sales. Other companies will overstock, meaning they order too much stock to sell. Additionally, some businesses might fail to hold enough safety stock during demand spikes. They are essential; understocking and overstocking result from failing to anticipate customer demand correctly.
With the aid of consulting services, companies can be assisted with the demand forecasting process to ascertain how much inventory they will need for a certain period. Part of this process will include the implementation of software and automation solutions. Essentially, these solutions will aggregate data on past sales to provide estimates for future stock purchases.
Frequent Rescheduling
Rescheduling will differ according to the type of company. Rescheduling shipments or inventory deliveries result from changing consumer demand and preferences for retail stores and companies. For the manufacturing industry, the late arrival of materials from suppliers delays the manufacturing of certain goods, meaning that delivery schedules to wholesale distribution firms and retailers will have to be rescheduled.
No matter the industry impacted, frequent rescheduling can impact the bottom line. For example, retailers that have to order new inventory due to changing customer demand still have to store any previously ordered inventory. Unfortunately, this will tie up more working capital and increase storage costs.
To prevent frequent rescheduling, consults can assist manufacturers and retailers with their logistics and distribution operations.
Poor Shelf Availability
Poor shelf availability results from a business failing to anticipate customer demand correctly. Additionally, businesses can also have inadequate safety stock levels. Insufficient availability of products will affect customers’ perceptions of a company and may ultimately avoid it should the problem persist.
An inventory consulting service can help your company rectify this problem by adequately projecting consumer needs. Then, with future demand projected, businesses can ensure they have adequate inventory levels to meet anticipated consumer demand.
Investment of Too Much Working Capital
Inventory is usually classed as an asset upon purchase—however, a failure to sell your inventory results in lost revenue. Additionally, until stock is sold, a substantial portion of capital is tied up, thereby reducing the amount of working capital that a company can spend on other areas of enterprise operations. Therefore, businesses must have the proper inventory levels to maximize returns on their working capital truly.
Crammed Warehouses
Warehouse and storage costs usually constitute a large portion of inventory costs. However, if companies neglect the organization of their warehouse, they can see their storage costs increase unnecessarily. Additionally, locating stock is more challenging in a disorganized warehouse. A crammed warehouse will also impact logistics operations further along a company’s supply chain.
Developing a warehouse plan to help with inventory organization is crucial for any organization to speak to consulting services. A consulting service can help implement organizational systems and solutions that will help organize your warehouses.
What Services Make Inventory Management Consultants Offer?
An inventory consulting service can help with a company’s specific needs and challenges regarding inventory management. These services include supply chain consulting, software and technology implementation, helping with overall logistics, and generating actionable insights for companies to use for inventory management.
Supply Chain Strategies
Supply chain strategies ensure that supply chains support a business’s long-term goals. Depending on the specific needs, goals, and challenges of a company, consultants can assist in developing a supply chain strategy. Due to the central importance of supply chains in inventory management.
Enterprise Resource Planning
Enterprise resource planning (or ERP) is an integrated approach that uses software and technology to facilitate business operations. Thus, consulting firms can implement ERP technology for inventory management that integrates and centralizes logistics, finance, supply chain operations, inventory levels, and warehousing processes. In addition, once ERP systems have been implemented, firms have instantaneous access to a wealth of data that is crucial for their operations.
Supply Chain Tactics and Operations
Supply chain tactics focus on processes and procedures that help a business save time and money. In essence, supply chain tactics are developed and implemented at a smaller scale than supply chain strategies. Again, consultants can help their clients select software and technology to help implement supply chain tactics. In addition, consulting services can help a company develop supply chain tactics to benefit a business in logistics, supplier relationships, and customer relations.
Supply Chain Mapping and Audit
As part of managing overall logistics, organizations must assess the general state of their supply chains. This can be accomplished through mapping and auditing. Consultants can help compile information about your suppliers, their suppliers, and how your supplies move around. Having knowledge of your suppliers and how your goods move throughout the supply chain is essential for business operations.
Moreover, supply chain mapping and auditing help firms evaluate the strength of their supply chain and the reliability of their suppliers.
Conclusion
Should your business require help with inventory management, an excellent place to start is speaking to the NonStop Group. The Non-Stop Group has helped clients strengthen their supply chain and logistics. The results are that inventory management improved by 35%, and labor hours were reduced by 15% due to the introduction of new technology. If you need these results for your business, contact the NonStop Group today!