Starting with Inventory Optimization
As businesses continue to cope with procurement and supply chain woes, many lack the time, resources, and planning to commit to optimizing operations. Instead, businesses are left wondering how to optimize inventory. Inventory optimization is an all-encompassing, critical component of every successful supply chain that includes many different significant aspects. It is the first place organizations should start when looking at increasing cash flow and cutting down on costly problems such as margin erosion.
Inventory optimization helps to hold excess inventory leading to a reduction in stockouts. This system maintains organization when monitoring supply and demand in a supply chain. Inventory planning helps businesses keep a close eye on stock, helping to eliminate complications regarding demand.
Why is Inventory Optimization needed?
Of the top supply chain managers 58% claimed that they would prioritize inventory optimization and 69% described that investing in digital services around supply planning is at the top of their list. A study performed by Mckinsey found that machine learning inventory forecasting can reduce errors significantly and increase accuracy, leading to a 65% reduction in lost sales and decreasing warehousing costs by up to 40%.
AI and augmented analytic tools are shaping the way that businesses interact with their data. Rather than reacting to problems coming down the supply chain, leaders can be more proactive with instant alerts and forecasts that guide decisions. Inventory optimization is a key supply chain capability of AI supply chain integrations that are shifting data like never before.
Having inventory optimization in your business’s toolbox leads to greater efficiency and less wasted inventory. With clearer inventory visibility, maintaining proper stock is easier and more efficient. Businesses can not only reduce backorders, stockouts, and overstocks but save capital while doing so, helping them reach product demand expectations. With inventory optimization software, business operations can accurately be adjusted to reach maximum efficiency.
This practice prepares businesses to have the right amount of inventory when they need it to meet demands. Inventory optimization solutions can begin to help businesses tackle a multifold of challenges.
The core benefits of Inventory optimization tools
Some of the benefits of AI inventory management include:
- Stock levels are reported and balanced
- Meeting production goals
- Saving money time and inventory
- Reduced spending/overspending
- Mitigating risk
- Clearer visibility
Any company that has an inventory of products or materials can benefit from optimizing its inventory.
With the right inventory forecasting software business performance will soar and risks will decline. Implement AI into your supply chain management and get ahead with inventory optimization solutions. Request a demo today at ConverSight.ai and get our supply chain on track today.