Retail Industry essentially involves bulk procurement of products and commodities and selling them off to individual customers. Products have to leave the supplier’s finished material storage facilities and get transported to the retailer’s storage facilities. The retailer may or may not have another hierarchy of storage of products.
The products are then sent to the retail outlet racks when the product reaches low levels on the retail outlet racks. The movement of stocks at different levels of storage is varying. The movement from the supplier’s storage isn’t a continuous process. It is a low frequency process but in large quantities. The customer’s purchase on the outlet floor is low volume and unpredictable. The situation at the extreme ends of the train of movement of products is quite different. The arrangement necessitates the building of buffer stocks at all stages to avoid the situation where you lose the opportunity of a sale in the absence of buffer stocks.
Need for Inventory Management
It is clear from the situation above that having buffer stocks at all the levels of storage means that capital gets blocked without any returns. It also increases the risk of loss due to obsolescence if buffer stocks are large. If one has a tight inventory management system, one can mitigate risks as well as increase productivity by bringing down the stockholding levels. The only way to do this is to use Information Technology to track the movement of each unit of each product. This system can give the managers the decision support system to micromanage the movement of stocks through different levels. It is also possible to mitigate the risk of obsolescence by tracking products that are not moving at a particular store and relocating it to another where it can get consumed.
Tools for Inventory Management
It is obvious that one needs some kind of Inventory Management Software to achieve what has been prescribed above. The success of Inventory Software still lies with the managers who use it. They have to constantly monitor the system and fine tune the variables to achieve optimum performance. One of the most useful tool for micro level monitoring is having RFID devices attached to units to record transactions accurately without manual intervention. A greater synergy can be achieved if the retail data can be linked with the manufacturer’s production plan in a B2B situation.
Other Benefits of Inventory Management Software
The stocks of products and commodities being held in different storage facilities of a retail industry business has a value hence it adds to the Balance Sheet of the accounts of the Company. A good Inventory Management Software facilitates in providing accurate figures of the Stock in Hand value of a company.
All you need to know about Inventory Management Software
To know about inventory management, you need to be familiar with the concept of inventory. Any business will have a component called inventory which is, in layman terms, a list of the products to be sold.
An Insight into Point of Sales in Retail Management
Point of sales is pivotal to any business. Most businesses invest a significant amount of time and resources into ensuring that their Point of Sales is on point. In today’s world, there are an extravagant number of businesses.
Inventory Management Software Along with Apparel Software, the Easiest Option
Inventory management came about when the task of managing inventories became too tedious a task for manufacturers and retailers of products. It is the science of specifying details about the percentage of stocked goods and overseeing and controlling the ordering, storage and use of the components that a company will need for its product manufacture.
