A fully-functioning inventory system that operates in real time is a necessity for any modern business. Several factors influence a company's decision as to which inventory system to implement, including ease of installation, simplicity of use and the total cost to purchase the system. A good inventory system allows a company to manage its supply chain at a much faster pace and increase efficiency and gets products to consumers more quickly.
Comprehensiveness and Deployment
An inventory system should provide a comprehensive view of a company's inventory across its entire system. A comprehensive view entails a variety of inventory aspects including current product levels, status of current product orders and the trends related to different product offerings. This allows a company to see not just its stores of product but which items are leaving warehouses and retail locations faster than other products. The ease of deploying an inventory system is also an important factor for a business. A complicated inventory system may require more IT professionals to install and maintain, which could increase overall business costs.
The user interface is a key feature of any inventory system. A system's ease of use is a large influence on which system a company chooses to implement across its production and distribution chain. An easy user interface allows a larger number of employees to use the system with a greater degree of success. This reduces the potential for errors in inventory information, which can cause problems further down the supply chain in the form of missing products and insufficient orders for clients.
Durability of the System
An inventory system that spends more time in need of repair than functioning properly can grind a company's deliveries to a halt, causing ordering problems at the point of sale. System maintenance also factors into an inventory system's durability. The number of IT professionals required to properly maintain an inventory system increases a company's payroll and can affect profits if the system fails routinely. A company that purchases a low-cost inventory system may find those savings quickly eaten up in maintenance costs and lost sales due to incorrect inventory numbers.
Utility Across the Supply Chain
The integration of an inventory system across a company's supply chain is an attractive feature for a business looking to keep tabs on the raw materials purchased from its suppliers. This allows a company to see where its raw materials are coming from and what locations these materials came from. This type of knowledge is critical if a business uses raw materials intended for human consumption. Using tainted raw materials could cost a business millions of dollars in lawsuits from affected consumers and lost sales due to recall orders of tainted goods.
Types of Inventory Control Systems
Every business needs to know the value of the products it has to sell. Without this information, a business cannot decide on...
Why Do Companies Need ERP Systems?
Enterprise Resource Management (ERP) systems digitize the day-to-day processes of running a business. While some smaller businesses may survive without software solutions,...
What Factors Influence the Value of Common Stock?
Common stocks are securities that represent an equity share of a corporation. Common stock shares entitle the holder to a share of...
Factors That Influence Organizational Structure
Organizational structure is important because a good structure allows efficient communication, encourages departments and groups within the company to work together, establishes...
What Are the Factors That Influence Health Care Services?
Health care services have the potential to offer you hope for eventual healing, return you to a better quality of life after...