Today, retail consumers expect three main things from brands: hyper-personalized product recommendations, continuous product availability, and fast delivery. If you fail on any of these, you risk losing ground to your competitors. One of the most crucial aspects that can help you achieve this – and which, ultimately, underpins the success of your business – is your inventory supply chain management. Specifically, you’ll need to ensure comprehensive, accurate, and real-time inventory visibility and transparency.
But why is this so crucial, and how can you gain this kind of insight? Let’s find out.
Why inventory visibility and transparency matter in effective supply chain management
There’s no doubt that consumer shopping habits have changed. The pandemic only accelerated the trend of online shopping, with consumers now expecting personalized and efficient purchasing and delivery processes.
This hyper-personalized trend is seen elsewhere in the commerce world, such as with the rise of appointment shopping, where customers book appointments for private visits at a brick-and-mortar store.
So, whether you exclusively trade online, through a physical store, or via a combination of the two, chances are that your inventory management in the supply chain is under pressure. This is why it’s so important to focus on inventory visibility and transparency.
With reliable, up-to-date information on your current stock levels, materials, and inventory, you’ll be in a much better position to offer your customers exactly what they want, when they want it. In parallel, keeping a close eye on your inventory also allows you to act quickly whenever you spot a snag in operations, helping you get back on your feet faster and more efficiently than before.
Benefits of inventory visibility and transparency
Better demand forecasting
Enhanced inventory visibility and transparency give you access to high-quality, real-time data. In turn, this allows you to better forecast what demand for a specific product might be during a particular time.
Among the many other benefits of inventory and production management, you will also avoid stockouts – the frustrating situation that sees items unavailable for purchase or out of stock.
Improved customer service
We all know that good customer service is the gold standard when it comes to snagging loyal customers. To begin with, you’ll need a stellar customer service team equipped with the best-in-class tech. For instance, using outbound dialer software lets agents optimize and automate outbound calling, leading to more efficient service and happier customers.
But, as the old saying goes, the proof is in the pudding. Regardless of how excellent your customer service support was, ultimately customers want and expect the right product delivered as quickly as possible.
Cue inventory visibility and transparency. By keeping your finger on the pulse of your inventory operations, you can track orders and ensure fast, safe, and smooth deliveries. All this makes for a positive shopping experience and loyal customers.
Reduced holding costs
Holding costs can quickly get out of hand without a proper view of your inventory. Knowing exactly how much stock you have as well as the different patterns of demand is crucial if you want to optimize these expenses.
This means that you’ll be able to avoid holding excessive inventory for products that are not selling as much as you thought (or are not selling enough right now), which inevitably ends up using valuable capital and warehouse space.
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Faster response to supply chain disruptions
Inventory visibility and transparency don’t just benefit you as a business owner – they also help all the other stakeholders in the supply chain. If you identify an issue across your inventory operations, in fact, you can swiftly communicate it to the relevant people, which promotes better collaboration and communication.
The result? Smoother operations and the ability to resolve issues faster, eventually have a positive ripple effect on your customers’ satisfaction, too.
Streamlined production and procurement processes
Lastly, increased visibility into inventory levels makes it easier to choose the optimal fulfillment center or warehouse. For example, imagine that the insights you gained into your inventory operations show you that you are spending too much money on machines you don’t need, or warehouse space you don’t use.
This may be because you’re not yet stocking enough products, or because the complexity of your operations is relatively low. Whatever the reason, knowing exactly what you need to support your inventory levels can help you streamline production and cut down costs.
Strategies to Achieve inventory management visibility and transparency in the supply chain
Implement advanced inventory management software
Inventory management software allows for up-to-date inventory tracking that is integrated with back-office systems and other business-critical solutions. This gives you unparalleled visibility and data accuracy, avoiding any hiccups with stock.
Alongside this type of software, other great inventory management tips include knowing your inventory inside out, investing in tracking software and using dropshipping where necessary – a retailing technique in which products are sent from the manufacturer to the consumer.
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Utilize barcode and RFID technology for automated tracking
Barcodes and RFID (Radio-Frequency Identification) are some of the modern technologies at your fingertips that can revolutionize your inventory game.
They streamline data capture and reduce the amount of human errors involved in tracking inventory. The result? Accurate, up-to-date data on stock levels, stock demand, and supply chain activities.
Establish a centralized data repository for real-time access
Suppliers, manufacturers, and third-party logistics (3PL) are all responsible for their own part of the supply chain.
However, they are likely to be flung out across the globe, or certainly a continent. For instance, your company may be based in Saudi Arabia (in which case, an SA domain name is vital for ensuring local digital reach), whereas your suppliers and manufacturers may be located in Asia and Europe.
With these geographical distances, it’s important to offer stakeholders a high degree of inventory visibility, to ensure a smoother work process. A warehouse management system (WMS) offers just this, by letting stakeholders have control of warehouse operations, for example by monitoring product quantities, picking, packing, and more.
Enhance demand forecasting with advanced models and analytics
Historical data will give you invaluable insights into inventory trends, demand patterns, and lead times. Use this data for all-important extensive forecasting and demand planning, to better predict inventory needs in the future.
Ensure data accuracy through regular audits and cycle counts
Conducting regular inventory audits allows you to reduce any discrepancies between physical stock levels and the data in your system. Bear in mind that high-volume or high-demand items should be counted more frequently.
Strengthen supplier collaboration for data sharing
As we mentioned earlier, if you are working with suppliers scattered across the globe you’ll need to ensure they feel as valued, connected, and involved as possible.
This is because if suppliers feel connected, they’ll be more likely to collaborate and help each other out. To achieve this, it’s important to share data such as sales forecasts, demand projections, and inventory systems with key stakeholders, so each can play a role in the success of your inventory operations.
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Embrace a culture of continuous improvement
Once you’ve completed all of these steps, don’t forget to keep on improving! Regularly viewing and assessing processes within the supply chain will help you spot what’s working well and what can be tweaked.
And remember to extend this approach to other areas of your business, too. For example, if you are an eCommerce retailer, you could use a domain name registration to help you find a domain that appeals to users in your region. Having a localized site with a memorable name allows customers to find your products more quickly and easily, encouraging them to return for more online shopping.
There’s no doubt about it – inventory visibility and transparency are crucial in today’s modern retail world. From letting you know exactly what customers in a specific area need during a particular time of the year to identifying unnecessary costs and inefficiencies, keeping a close eye on your inventory levels is paramount. As a result, your business will be better able to stock the right amount of products, slash waste, and deliver a smoother and more satisfactory customer experience.