Accuracy is an essential ingredient in supply chain management. Without it, managers have a more difficult time making the right decisions for their organizations.
There are three main ways organizations can improve the accuracy of their supply chain system. First, use barcodes and scanners. Second, use inventory management software to organize the data. Third, automatically update the accounting database at the same time as the inventory database.
1. Using Barcodes and Scanners
With the help of barcode software and portable scanners, organizations can easily keep track of their inventory levels, place orders and accurately assess their ever-changing inventory needs.
When new products arrive, workers can scan them in and instantly update their inventory database. This saves time and reduces the risk of errors creeping into orders and inventories. If employees have to type product numbers and quantities into a computer by hand, they are more likely to make errors than if they scan product barcodes.
2. Using Inventory Management Software
Barcodes and scanners are great tools, but unless they have an organized place to put their information, they are useless. Inventory management software helps companies stay up to date on their inventory situation. An electronic inventory database can be instantly updated via barcode scanners so that at any given time managers know how many products they have and how many they need.
Inventory management software is also a good tool for estimating future inventory needs. Based on past sale cycles and changes in consumer demand, the software can help managers order more or less of certain products to maintain a balance between being overstocked and out of stock.
3. Updating Accounting and Inventory Databases
If managers have to enter the same information into multiple databases, they have a higher chance of making a mistake along the way. However, if inventory management software automatically updates a company’s accounting software, this problem is solved.
Combining inventory management and accounting databases benefits organizations by increasing their accuracy and making sure they know how much cash is receivable, payable and in the bank, even with their changing inventory levels.
The importance of accuracy in inventory management can’t be overstated. By using barcode scanners, uploading data to inventory management software and combining accounting and inventory databases, organizations can improve their chances of having correct information to make decisions with.
Robert Lockard is a copywriter for Fishbowl Inventory.