Inventory Management and Your Bottom Line
Inventory management is about understanding demand and finding the right balance so that your costs are lowest and profit margins highest. If managed correctly, at the simplest level, your production keeps moving forward and your customers stay happier.
Managed poorly, inventory impacts all areas of a business, and ultimately your bottom line. If customers can’t be serviced, then you risk satisfaction and retention levels. If you hold too much inventory, then you incur unnecessary expenses. If you hold inventory too long, then you risk the item becoming obsolete. If you use inventory in an assembly, then you need to make sure you have the right amounts of raw materials, sub-assemblies, spare parts and finished goods. Add SKU and serial/lot tracking to the list and you have a lot to manage.
Understanding demand cycles so that inventory requirements are correctly aligned with demand can be tricky. How do you find the right balance between production and inventory? You look at history, you look at trends and forecasts, you analyze. Maybe you use Excel. Traditionally you make a best guess.
Epicor ERP (Enterprise Resource Planning) Inventory Management, based on Microsoft technologies, can take the guess out of ‘best guess’ while simplifying and streamlining the entire process. Whether your business is cyclical or seasonal, Epicor ERP business analysis tools provide management with the ability to do ‘what if’ analysis, enabling them to see the impact that changes, such as demand fluctuations, will have on production, the supply chain, costs, budget and more. With Epicor ERP forecasting tools, which include colorful dashboards, management can gain a better understanding of demand fluctuations and plan accordingly. Better forecasting means:
- Taking advantage of quantity discounts
- Carrying less inventory
- Improving customer service levels
- Operating within a budget.
Epicor ERP data tells management a story using real-time numbers and historical trends from which inventory can be correctly aligned with forecasts. With that, management has the confidence to carry less inventory because powerful data reduces risk and backs up decisions. Carrying less inventory results in:
- Inventory optimization
- More working capital
- Less storage costs
- Reduced risk of obsolete inventory.
For job shops, the Epicor ERP quoting function pulls data from inventory to help job shops provide customers with more accurate quotes and delivery schedules by building variables into the quote. Variables such as inventory status, outstanding customer orders, and future delivery dates enable sales to provide customers with costs and delivery dates based on real time information.
Outstanding orders are also evaluated during Quote Entry. Epicor ERP looks at outstanding orders to determine if inventory can be pulled from an order without compromising customer delivery dates. When reallocating inventory from one customer order to another, top customers are given top priority.
As you can see, having a powerful inventory management system can have a positive impact in many areas of a business. Epicor ERP is a robust solution designed to help mid to large sized businesses meet their most challenging goals and objectives. Epicor ERP is a solution that improves business processes and efficiencies, a system that provides real-time insights and analytics for better decisions, a system that enables businesses to reduce operational costs and improve their bottom lines. Think you’re too small for Epicor ERP? Then Epicor Cloud ERP can be your stepping stone.
Have questions or need more information on how inventory management can impact your bottom line? Contact MIS. MIS, with 30 years of experience helping companies like yours identify technology solutions, can show you how Epicor ERP uses the latest Microsoft technologies, combined with industry best practices, to help you meet your business goals and objectives.