If you’ve worked in manufacturing or distributing for any amount of time, you know that inventory management optimization is a delicate method of balance between capital investment objectives and constraints against goals for your SKUs, all while keeping supply and demand volatility in mind. It’s a tricky balancing act for sure. How do you decide what and how much to stock, when, and in what form?
On one side, you need to satisfy customers who expect product delivery at warp speed, sometimes by keeping higher quantities on hand. On the other side, keeping products and materials on the shelf can get expensive. In manufacturing, as much as 50 percent of your capital can be tied up in inventory.
If you’re serious about finding ways to streamline your inventory management operations, here are four keys to success you can find with SYSPRO ERP.
- More Accurate Forecast Demand
It’s important to purchase raw materials wisely, taking into account issues such as seasonality and favorable purchasing terms. Using SYSPRO inventory management, you have access to advanced forecasting, demand planning, and modeling with “what-if” capabilities that show the trade-offs related to inventory and fulfillment time.
In addition, SYSPRO enables you to conduct an analysis of stock codes (SKUs) by multiple algorithms at a granular level, giving insight into each item’s historical demand behavior and impact on profits. Based on that information, you can create segments and balance ordering. When it comes to new products with no history, SYSPRO’s proxy functionality will forecast demand based on the sales history of similar superseded products.
- Improved Planning for Sales and Operations
With SYSPRO’s integrated scheduling, inventory forecasting, and Materials Requirements Planning (MRP) solutions, order only what you need in response to demand, reducing both costs and waste. This functionality is complemented by features such as “available-to-promise” and various time fence indicators, which give sales and production staff a reliable view of what they can promise to customers and when.
In addition, SYSPRO inventory management features advanced business intelligence reporting to analyze KPIs such as lost sales, days of stock cover, and days out of stock. Once you identify slow-moving, excess, active, and static stocks, your sales team can then create targeted promotions, and operations teams can accurately handle obsolescence provisioning.
- Use Budgets and Inventory Targets to Drive Efficiency
With SYSPRO Inventory Optimization connected to an MRP solution, your team can use demand forecasting to calculate budgets and targets for purchasing raw materials. Develop ordering policies by stock code at the warehouse level, then calculate time-phased minimum and maximum levels dynamically, based on demand forecasts. With set targets, you can further improve efficiency by automating processes such as standard reorders.
- Rapid Troubleshooting of Daily Inventory Gaps
With real-time access to inventory information, you can pinpoint and address issues quickly before an out-of-stock situation occurs. SYSPRO ERP shows you where and why inventory is not in balance, with tracking signals to indicate when forecast accuracy might be in doubt. You can also leverage alerts to automatically notify you of supplier issues, so you can speed up resolution.
Inventory Optimization with PositiveVision
As your business grows in complexity and you support multiple sales channels or global locations, accurate forecasting and planning become even more challenging, and mission critical to driving profits. If you’re using manual processes and guessing what and how much inventory to carry, there’s a better way, and PositiveVision can help you find it.
Our full-service software consulting team is dedicated to helping small and mid-sized businesses get the right software in place for efficiency and profitability. If it’s time to get SYSPRO ERP into your organization for inventory optimization, we can help get you there.