In the wake of COVID 19, several businesses out there have been desperately diverting their supply chain strategies toward automation. Be it manufacturers, supplier, or wholesalers, anyone and everyone who’s part of the supply chain, have no choice at hand, but to switch over to automation, especially in the wake of acute workforce shortage. With more and more employees working from home, supply chains’ operational capacities have been affected in a big way.
If this wasn’t enough, erratic customer behavior has added to the supply chain crises. With future uncertain, supply chain management teams are looking to turn around their operations by becoming more agile and resilient so that they could face the changing economic scenario with more optimism and confidence.
According to the 2019 MHI and Deloitte published report, supply chains investment in digitization was not up to the mark. But then it did not come as a shocker because supply chain managers are aware of the challenges in the form red-tapeism, proof of investment, and general human nature to despise change.
However, with pandemic tightening its grip around the world, businesses that were not ready for automation are now embracing it without any second thoughts to keep pace with the evolving business environment, both for now and the future.
How Supply Chain Automation Benefits Businesses
- Cuts down operational costs and enhances productivity
- Transparency in business operations
- Data analytics is available for businesses to make informed business decisions
- More agile and flexible supply chains that respond quickly to slowdowns
Automating Supply Chains by leveraging Inventory Management Software
Inventory management software aids supply chain managers in various ways. Here are some examples for you to get the hang of it:
Automates Demand Forecasting
Inventory demand forecasting is all about predicting customer demand for an item over a pre-determined period. Precise inventory forecasting helps companies stock the right amount of stock, for optimum inventory management, without under or overstocking. Also, historical data trends and market knowledge are leveraged to forecast inventory demand.
Bridges Supply and Demand Volatility
Inventory management software helps manage supply and demand volatility. Quite simply, it reports items that may go out of stock to put a plan of action in place. A constant cross-verification of demand against supply is done, raising a flag when the consumption doesn’t match the projections. Finally, stock deviations are underlined to find whether the increase/decrease is worth taking note of and whether to add them to the future forecast.
Transparency in Inventory Management
As it turns out, inventory management software gives a transparent view of the most in-demand items, and those with volatile sales patterns and, also, those that cost most to sell. Such data helps businesses to focus on those items that attract maximum revenue and, most importantly, secure, beforehand, the supply of most important stocks.
Tracking Supplier Lead times
Inventory software also arms you to track supplier lead times. Now, how does that help? In the case of increased lead times, the software adjusts inventory reorders accordingly. And once the lead time is streamlined, quantities are re-adjusted to prevent overstocking of inventory.
Automatic Replenishment of Stocks
The manual calculation of replenishment stock is tedious and time-consuming. On the other hand, automation will enable the automatic generation of data that teams can use for order recommendations and send them for further processing in ERP. This helps the team to spend their time on other core areas of business.
Businesses already using inventory software, the curse of COVID 19, would have been subtle compared to those who were still contemplating its use. As mentioned above, the benefits of automating your inventory are enormous, and so if anything, businesses shouldn’t give in to inertia and install such value-adding software immediately.