Why You Need Better Inventory Visibility
To meet customer demands and stay competitive in a world where expectations for product availability and delivery speed continue to rise, every link along the supply chain has to operate efficiently. From warehouse management to order fulfillment to juggling multiple channels, there are often countless points in a single product’s journey where eliminating errors and delays could mean increasing profit and optimising the customer experience.
One of the fundamental ways to ensure this happens is to improve inventory visibility. The reasons are simple: You can’t avoid problems you can’t foresee and you can’t optimise what you don’t understand.
What Is Inventory Visibility?
Inventory visibility is your ability to see the status of every SKU across all locations (your warehouses, stores, your suppliers and third-party providers) in real time. The key to having full inventory visibility is to leverage a supply chain network connecting all your stakeholders. This not only gives you control over your data but also allows you to share it with your supply chain partners and customers.
Having the data and analytics to manage the many complexities of your operations (which might include omnichannel sales, drop shipping, BOPIS, 3PL, or numerous retail relationships) will help you make better business decisions, operate quickly at times of high demand and grow your business. The right technology makes it easy, so you can focus more of your employees’ effort on doing business in every direction.
The Benefits of Inventory Visibility Across the Supply Chain
Having accurate inventory insight isn’t just great for your customers and trading partners; it’s also beneficial for your team. Manually tracking inventory is a mundane way to use employee time and detracts from their ability to build better customer and partner relationships. Plus, it can result in out-of-date information that makes decision makers’ jobs more difficult. Here are just a few ways the right solutions can unleash new operational efficiencies across your organisation.
When you have real-time inventory data at your fingertips, you eliminate common drains on time and cost efficiency. By integrating and automating inventory information, your business gets a leg up on improving internal processes. That’s because real-time inventory data is immediately actionable and helps you make better decisions, allocate product optimally and streamline your transactions with your supply chain partners.
For eCommerce businesses, knowing your inventory levels makes it possible to sell across multiple channels, while giving customers accurate availability information. Instead of frustrated customers, you create satisfied ones.
Stockouts are customer loyalty killers and having better inventory visibility helps you avoid them. Using historical data, you can better predict how much product is needed where and at what point in your business cycle.
Using current data in real time, you can maintain healthier, more balanced inventory levels in all the places where your products need to be. You can also create timely, smarter replenishment strategies. Having high-quality inventory insight makes your business better prepared to respond to periods of volatile demand--without devolving into chaos.
Maintaining inventory is likely one of your organisation’s biggest costs. Having real-time visibility into your inventory enables you to optimise warehouse stocking, keeping costs low while ensuring you can meet customer demand. The right integrations can also allow you to use your inventory data to help lower logistics and shipping costs.
How to Improve Inventory Visibility with Unified Commerce
Many supply chain businesses today are leveraging powerful technology solutions to better manage activities such as order processing, warehouse management and fulfillment. But many others still use separate, siloed solutions that don’t provide enough visibility. Unified commerce solves this problem by bringing your omnichannel operations together using integrated technology. Using the unified commerce model, you are better equipped to manage stock optimally and fulfill orders quickly, at the lowest cost.
Unleashing this potential begins with an automated method of exchanging data. While you might hear a lot about APIs taking over the world, over 82% of global electronic transactions are handled through electronic data interchange (EDI). If your business isn’t already harnessing the benefits of EDI, the time to begin is now. Tools like EDI provide simple means to exchange inventory related electronic documents across the breadth of your supply chain.
In doing so, you keep everyone in the loop on inventory movements. Solutions like TrueCommerce EDI also offer easy interfaces that reduce manual labor and miscommunications while enabling you to make better decisions.
Comprehensive visibility relies upon a central “inventory hub” that acts as the aggregator of inventory information across the extended enterprise – products in your warehouse, in transit to your warehouse, at a 3rd party logistics provider (3PL), in a returns facility and even in the finished goods warehouse of your suppliers. And if your business includes providing goods to retailers, the “hub” also includes inventory positions and movement within each retail location. This gives your business the advantage of up to the minute product availability so that features like available-to-promise (ATP) help suppliers allocate products in short supply, providing valuable fulfillment transparency for partners.
Another benefit of visibility into your retail partners’ inventory is ensuring timely replenishment through vendor managed inventory (VMI). TrueCommerce VMI gives vendors insight into stock levels at retail partner locations and establishes automatic reordering thresholds, so products arrive just in time. This keeps warehouses lean on both ends and improves the customer experience with fewer stockouts.
Advanced VMI features leverage your data to an even greater advantage. This is crucial in an environment where customers are choosing products that can be delivered the next day or even the same day.
An integrated eCommerce platform is another way that you can improve inventory visibility in your business to everyone’s benefit. With online shopping on the rise, it is important to give customers accurate information about what is available. After all, no customer wants the experience of hitting “order,” and then receiving an “oops” email due to out of stocks.
Our aforementioned “inventory hub” works in conjunction with your eCommerce system so digital buyers always see the correct availability. All of this results in minimising the chance of an “oops” moment and helps your “order hub” or ERP system determine the most cost effective location, time and shipping method to get the order filled (but more about that in a future blog).
Visibility Means Profitability
With an excellent ROI and measurable benefits for all parties involved—your business, your partners and your customers—leveraging technology to increase your inventory IQ is a smart way to prepare for the future. If you’re interested in exploring more about how you can increase inventory visibility in your business for greater operational efficiency, get in touch. We’d be happy to kick off a conversation with you.
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Contributor Ross Elliott, as one of the founders of TrueCommerce, has led the operations, customer relations, and overall product strategy and development for the company. With more than four decades of experience in supply chain technology, he has a deep understanding of supply chain operations, commerce networks and software strategy and currently acts as the Chief Strategy Officer of TrueCommerce. He serves as a lead advisor for TrueCommerce's unified commerce Foundry platform. Ross splits time between Colorado and Florida with his wife of 47 years, Sandra, his son, Bryan, and their dog, Mycroft.