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Managing a warehouse is a complex and multi-levelled process. If you are currently managing a warehouse, you will already be familiar with the different costs involved and how ordering and selling inventory go way beyond the purchase price of each item, and that these additional costs need to be managed to ensure that your business remains profitable.

There are many aspects that need to be managed when it comes to inventory processing, and being able to identify and quantify each of these aspects are cost-saving opportunities. However, difficulties can arise when you are unable to differentiate between them or even worse, be unable to identify them in the first place.

There are many different types of costs associated with inventory management, but for today, we are going to explore the three major ones.

Inventory Costs – What are they?

 

Carrying Costs

Warehouse inventory involves capital that you may not even realise has a direct link or association with your stock. You need to consider where your stock will be stored, the utilities involved for your premises e.g. lighting, heating, air conditioning, as well as insurance and staffing. Typically, the greater the amount of inventory the greater the carrying costs and these costs can slowly erode the value of your inventory if the carrying costs have not been identified.

There are also other costs that are associated with carrying inventory. If you are managing a warehouse, you generally have a good idea of what your stock movements, are and which items of stock are fast-selling and which usually hang around in stock for longer. However, holding stock over a long period increases the risk of inventory shrinkage and obsolescence.

Inventory shrinkage simply means your total item stock count has shrunk over time and this can occur for several reasons such as damage, misplacing of goods, stolen items and waste. Obsolescence is when your stock becomes outdated or no longer of use; this particularly important for perishable good and expiry dated items.

By integrating our Bit Inventory with your existing Sage Accounts, our advanced functionality can help you to avoid these issues by easily keeping up to date with stock rotation. For items that are not limited by expiry dates, you may face other issues such as seasonal or fashion trends, where the cost of your inventory is tied up and cannot be reinvested elsewhere.

 

‘Sold-out’ Costs

There are many ways to try and reduce the costs of carrying inventory and many warehouses utilise the just-in-time stock approach. Though this method can be successful in reducing costs, there are many risks associated with this. The just-in-time approach does not account for the spike in sales such as seasonal trends and more often than not can leave you with out of stock items.

Out of stock items can have major implications on your business, leaving you with empty shelves or warehouse space, as well as reducing customer confidence and satisfaction. However, by integrating inventory management solutions such as Bit Inventory 50 or Bit Inventory 200 to your Sage Accounts you could prevent these issues. From order processing through to receiving goods, dispatching and stock taking, our Sage inventory solution makes your process efficient, accurate and eliminates human errors.

Ordering Costs

In addition to the purchase cost of inventory, there are other costs to consider such as the procurement of the inventory, for example, the delivery, the labour of transporting and transferring stock, as well as the overall management of the stock process and the downtime costs for manual stock takes. By not having the right systems, these processes can be left open to human error. The question is, how much control do you really have over your stock inventory processes? Our Sage integrated inventory management solution can help you take back control.

 

 

Reducing Inventory Costs – What are the best practices?

Having an insight into your warehouse is vital but knowing how to manage it and how to assess the hidden costs is even more important. Real-time data can help ensure that your procurement is linked to demand, order processing, and is tailored to your customer needs.

Greater automation can help reduce staffing costs and human errors and give you real-time oversight of your inventory levels.

 

 

Get in touch today to find out how we can help you maximise this powerful inventory management solution.

Inventory Management is an ever-changing and adapting industry. In today’s agile environment it can be hard to manage the changes in customer demands as well as keeping on top of industry news and trends. There are many recent trends that you may have already heard about and it’s definitely a good idea to keep an eye on them as they develop. Let’s look into a few of the inventory management trends that could help transform your warehousing and logistics operations.

Advanced sales forecasting

There are many reasons as to why customers are unlikely to use your services again. This doesn’t solely come down to your products or customer services, its one step back from that. It’s the availability of your inventory. Have you ever considered, at what point long delivery times or the sold-out stock becomes a deal-breaker for you and your organisation? With the rise in online giants such as Amazon, offering next day delivery, customers are increasingly becoming more demanding for immediate availability of stock and will not tolerate waiting for items that are currently out of stock.

Advanced sales forecasting ensures that you have the right products on your shelves or in your warehouse when your customers need them and reduces the risk of having out of stock items. This means higher customer satisfaction levels and in turn, means higher sales numbers. However, the advanced sales forecasting can become almost impossible if you do not have an accurate demand forecast to work from. By integrating Bit Inventory 50 or Bit Inventory 200 into your Sage Accounts you can know your stock levels and trends at any given time to assist you with advance sales forecasting.

 

Digital twin technology

A digital twin is a trend that is becoming increasingly more popular. A digital twin is a technology that replicates a product, process or service in a digital format. It is a bridge between the digital world and physical reality, using sophisticated technologies to gather data such as working conditions, real-time status or position. We have already explored the importance of how Sage stock control can help to shape your warehousing data, but how can digital twin technology help to improve your inventory management even further?

Let’s take the example of your car for a moment. If you have a modern car, chances are you have a real-life example of digital twin technology right before your eyes. In the past, you would know if there was a problem with your car if your car broke down. However, in today’s world, we are well aware of an issue with our cars from warning lights, errors and signals. These messages provide indicators to what is wrong with your vehicle or inform you that action needs to be taken, sometimes even before an issue has even occurred. Pretty handy right? So, imagine the same process but in relation to your warehouse. Digital twin technology can provide a glimpse of your existing and predicted inventory, as well as show you where to locate your stock. This can reduce the cost of stockouts, delivery and manual labour. For successful inventory management, pair this concept with our Bit Inventory software and you will be able to optimise your stock levels and reduce lead times as you will already be aware of low stock levels, and inventory movements before any issues occur.

 

 

User Interfaces

Warehouse Managers seldom have time to wade through reams of data to find the answers they are looking for. Therefore it is important to have an inventory management system with a simple and intuitive user interface that presents data in a logical format. By using an inventory management solution such as Bit Inventory 50 or Bit Inventory 200, warehouse managers and employees can focus on the job in hand, as the simple and engaging interface, that involves little training, presents the data that you need at the touch of a button.

An inventory management solution with a well thought through user-interface can also have additional benefits to your business, such as reducing the cost of training new employees. For example, many warehouses have seasonal peaks, where temporary workers need to be brought in to help cover the spike in activity. With our Bit Inventory solution, there will no longer be a need for long training sessions and you can have your temporary staff up and running in next to no time.

 

 

Expanded functionality

In order to manage their warehouse more effectively, Warehouse Managers are increasingly looking for inventory management solutions that do more than just record stock movements and inventory levels.

For example, if you stock products that are perishable and you need to track expiry dates for stock rotations, or if your items have serial numbers that you need to track for product warranties or rebates.

Choosing an inventory management solution that reduces administration time and tracks expiry date or serial numbers just by scanning a barcode, can help to improve your warehouse efficiency and give your warehouse managers more time to develop new procedures, manage the warehouse better, and enable you to provide an even better service to your customers.

 

 

Are you ready for more information?

If you are, then feel free to get in touch. We have a lovely team on hand who have more details for you. Let us help you find the best ways to manage your inventory and use data to improve your business.

Identifying that you need more advanced inventory management software is only the first step in choosing a new solution, the tricky part is finding one that you can understand, utilise and control. With integrated Sage inventory software, you can seamlessly combine your inventory management with your Sage 50 accounts data to give you real-time, accurate stock information at your fingertips.

So how do you go about finding the right inventory solution for you?

One of the most important steps in choosing a new inventory management solution is to see it working. Bit Systems help our customers to get a full understanding of how our solution works and how it could benefit their business by providing an in-depth demo before any commitment is made. Our demos are tailored to our customers’ requirements so that we can demonstrate how the software could work for their business and how simple it is to use.

 

Why is a Sage integrated inventory solution better than standalone solutions?

By simply integrating into Sage 50 Accounts and by using the latest GS1 compliant barcoding standards, Bit Inventory 50 makes your whole stock management process seamless.

Using Bit Inventory 50 and Sage together, your accounting solution will be turned into a powerful inventory management solution, which enables your workforce to quickly and simply capture stock transactions through our handheld scanners in real time and automatically update Sage to drive efficiency, performance and eliminate the duplication of tasks and stock count time by up to 90%.

Not only does Bit Inventory 50 help your business to save time and reduce errors, but our developers have also worked hard to make sure that our software is simple to navigate and easy to use and by integrating directly into Sage 50 Accounts it minimises the risk of discrepancies between non-integrated inventory management solutions and your accounting solution.

Advanced inventory management functionality

Our sage inventory management solution has many different functionalities to help cater for different types of businesses, from order processing through receiving goods, dispatching and stock taking, our Sage inventory solution makes your process efficient, accurate and eliminates human errors.

If you need even greater functionality Bit Inventory 50 also give you the option to manage multi-location, to assign and track batch and serial numbers and even assign expiry dates to perishable products to give your business greater flexibility and improved stock accuracy.

Check out how Bit Inventory 50 works and get a software system that manages, tracks and controls your stock inventory so you don’t have to.

We are all familiar with the beeping noise in the supermarket, however before 26^th June 1974 all shop transactions and sorting of stock was manual, that was until the barcode was invented and transformed the retail industry. The barcode was invented by Norman Joseph Woodland in 1949 on a Miami beach, but his idea did not come to fruition until 25 years later when technology had caught up with Woodland’s revolutionary idea.

The barcode is still used today, not only in the retail industry for transactions and sorting stock, but in aerospace, manufacturing and many other industries for asset tracking, travel and even advertising.

Bit Systems use barcodes as part of their Bit Inventory software that integrates into @Sage to help businesses improve their stock management and business processes through barcoded stock control. Find out more about how Bit Inventory can help your business by visiting our Stock Control Management Software for Sage page.

Bit Systems Stock Control solution Bit Inventory 50 with ASM integrates with Sage 50 and now has some exciting new features!

New features include:

• Fully Wi-Fi enabled (2 way synchronisation)
• Bin prioritisation
• Guided Put Away & Guided Pick
• Stocktake by location as well as by product
• Powerful label printer options to be able to print labels which are product and location specific

Talk to us today to find out more about the new features #stockcontrol #sage #warehousemanagement