Inventory Planning and Optimization the Key to Your Inventory Success
Well, it’s a new year that brings slowly improving global economies. In these challenging times, it is important to balance short term resilience with longer term needs. You will hear a lot about reducing costs, buying less, increasing productivity, improving cash flow and more. It is important to keep these inventory objectives balanced and in perspective. Yes, currently, times are interesting but, as economic growth gains momentum you will need to improve your competitive advantage.
Regarding reducing inventory investment, many companies have tended to reduce the items with the highest investment because it creates a larger reduction faster. However, what it also does is lead to stock outs, higher backorders and increased expedited shipping. All of these can create an even bigger problem: customer dissatisfaction and lost sales. When customers are dissatisfied, they become former customers. Randomly cutting inventory has been proven, time and time again, to be the wrong strategy as does overstocking your inventory.
Now, more than ever, you have a lot of choices for improving your inventory investment. The Cloud is a viable alternative to investing in On-Premise inventory software. Software-as-a-Service provides an affordable way to utilize some of the most powerful inventory planning solutions on the market.
Why should you be interested? SaaS applications provide many benefits you just cannot achieve on-premise. Benefits include:
Lower upfront capital: By going to a SaaS model, you avoid the up-front capital requirements and funding requests, and pay for the software as an on-going expense.
Faster implementation: There is generally less overall set-up time, and in some cases, companies can often leverage the hosted solution’s existing integrations with existing key ERP solutions.
Faster “time-to-value”: Given a more rapid implementation, the time-to-value and positive cash flow returns are more rapid than a traditionally deployed on-premise implementation.
Reduced internal IT resource requirements: No installed application software or hardware to manage over time.
Overcome objections to best-of-breed software: Some companies are finding that they are able to overcome the objections or rules against implementing software that does not come from the company’s ERP provider if they use a SaaS model.
Fit for “on-demand” usage: Users can truly access these solutions when they need them anytime and anywhere 24x7.
Staying current with technology: The software will periodically be automatically upgraded with enhancements to functionality. This should serve to keep users on the current platform, and keep them from falling behind the state of the art over time, sometimes badly so.
So, before you wait another moment, do yourself, you employees and your customers a favor and take a serious look at Cloud based inventory planning and optimization solutions.
According to one of our customers,” if you under invest in your inventory, you lose customers. If you over invest in your inventory you lose money.”