Inventory management is one of the biggest challenges faced by small-to-medium sized manufacturing and distribution enterprises. Whether you warehouse raw materials, finished goods, or both—how you manage your inventory has the potential to make or break your business.
Inventory management refers to demand forecasting, ordering, receiving, storing, using, selling, and moving a company’s inventory. The end goal is to streamline your inventory to avoid excesses and shortages.
The key objectives of inventory management are:
- Optimized stock levels (having the right amount of stock in the right place at the right time)
- Reduced inventory carrying costs (such as warehousing, labour, transportation, depreciation, and shrinkage)
- Smooth and timely order fulfillment (resulting in improved customer satisfaction)
In addition to decreased inventory carrying costs, better inventory management also equals better cash flow. Cash tied up as a product sitting in a warehouse is not cash working for you. Knowing how much inventory you have on hand, how much you need, and when you need it, frees up capital to invest in other business areas.
Without proper inventory management, you may find yourself dealing with frequent inventory emergencies and be unable to meet production or fulfilment demands. Or end up with a large surplus inventory gathering dust and tying up valuable resources. Either will cost you time and money, and can harm customer and supplier relationships and damage your reputation. Getting a handle on inventory management is crucial.
Complex Inventory Needs
Your inventory management will grow in complexity as your business grows, especially if you manage inventory across several warehouses or sales channels. Unless you have an inventory management system that is integrated with the rest of your business, it will be very difficult—if not impossible—to optimize your inventory.
Enterprise Resource Planning (ERP) refers to software that enables you to integrate, align, and manage your logistics, operations, finance, and inventory on a common platform.
With an ERP inventory system, everything is automated and connected. As a result, you have reliable real-time visibility across purchasing, manufacturing, inventory, and warehousing—making your organization more organized, streamlined, and efficient. Pulling real-time data from different departments or business units also results in richer and more reliable information, better reporting, and more informed decision making.
An ERP inventory system also allows you to:
- streamline processes
- better track your business performance
- decrease manual labour costs
- reduce human error
- better forecast inventory needs
A Smart Solution for Complex Inventory
In our opinion, Microsoft Dynamics 365 Business Central is the best ERP system for SMEs with complex inventory needs.
Complex inventory is something that Business Central does exceptionally well. If you want to barcode, no problem. If you want to lot track, no problem. If you want to serialize, no problem. If you want to manufacture something and accumulate the costs in buckets along the way, no problem. And since it’s Microsoft, it integrates seamlessly out of the box with all Office products and extensions (such as Word, Excel, Outlook, and Teams) and other Microsoft software such as Power BI and software partners such as Shopify.
It is definitely worth considering if you have complicated bills of materials, foreign exchange or shipping issues, or an outdated system that needs replacing. And although Dynamics 365 Business Central can be customized to fit your particular needs, the out-of-the-box solution provides an excellent starting point.
We speak the combined languages of IT, accounting, and business consulting
S+C Partners has an established Information Technology practice with an experienced team dedicated solely to ERP implementation, integration, development, support, and upgrade services. As a Microsoft Dynamics 365 Business Central reseller and trusted integrator partner, we specialize in providing Dynamics 365 Business Central solutions to clients with complex inventory needs.
If you have complex inventory needs and your business is feeling the pain of siloed or outdated systems and processes, please get in touch with our ERP experts at firstname.lastname@example.org. We would be happy to answer your questions and discuss how we can help minimize your inventory costs, maximize your profit, and optimize the growth of your business.
Looking for more information? Read our Insight “Cloud ERP – is it worth the upgrade?” or explore our Information Technology services. We also specialize in accounting, advisory and tax planning and strategy.