Inventory Visibility & Supply Chain Performance

Choosing the right partner can make or break your company’s logistics, customer service, and repeat purchases. Using a fulfillment center like Shipfusion frees you from navigating the fulfillment landscape with zero stress. Below are some insights on how Shipfusion can take your business to the next level.

What is Inventory Visibility?

Inventory visibility helps you maintain stock levels by knowing where the inventory is. It involves tracking and tracing goods through the process of receiving, assembling, disassembling, storing, and shipping them to various destinations without a hitch.

It’s a process that reflects the degree to which suppliers or internal departments avail information. Often, the information required comprises physical inventory and warehouse location.  

The supply chain is a vital part of any business. It directly affects its efficiency, profitability, and growth. If the supply chain breaks down, then companies can suffer major losses. Streamlining the supply chain process requires better management and inventory visibility. These two are key to company growth.

Why Does eCommerce Inventory Visibility Matter?

Many businesses continually embrace inventory visibility. This is because they opt for omnichannel. It’s a process that fulfills orders and keeps tabs on the distribution model.

To achieve a successful order fulfillment process, you must understand the inventory movement. The following questions assist in determining whether your inventory is visible or not;

•     What product is available at hand, and what is the quantity by SKU?
•     Where is it located along the supply chain?
•     Is the information reflecting in the systems accurate?

Benefits of Inventory Visibility along the Supply Chain

An accurate inventory visibility system has several benefits. It ensures effective order fulfillment and material handling operations.

Other benefits of inventory visibility along the supply chain include:

•   More accurate forecasting
•   Smarter resource allocation
•   Increased efficiency
•   Reduced stock levels
•   Increased demand fulfillment
•   Greater supply chain transparency
• Let’s take a closer look at the benefits below.

1. More Accurate Forecasting and Increased Demand Fulfillment

Successful order fulfillment requires reliable, if not accurate, estimates of its inventory needs. It’s essential to know how much of each product the business needs in the course of a business cycle.

Identifying peak periods in the US is as important as knowing the seasonality of the business if any.

Accurate inventory visibility makes it possible to reconcile current levels of goods. It also enables the business to anticipate demands.

2. More Efficient Use of Time

Tracking inventory manually takes a lot of time, money and is a hectic process. Most affected are those operations that work within a complex supply chain.

In a complex eCommerce fulfillment supply chain, product shipping is regular. The movement happens through several warehouses, distribution centers, and stores.

Some technological solutions automate inventory tracking. Examples are Radio-Frequency Identification (RFID) and barcode scanners.

3. Increased Efficiency and Supply Chain Transparency

Inventory visibility determines how much inventory is available at every supply chain level. It brings with it an added benefit important to highly regulated industries.

Tracking orders and products can help companies ensure they’re complying with industry regulations. These sectors are;

•   Bio-medical supplies
•   Pharmaceuticals
•   Food
•   Chemicals

The need to follow each product in lots and batches arises. This includes operations such as producing and transporting goods.

Inventory visibility helps manage goods for delivery and their destination. Monitoring also enables the timely recall of sensitive products.

4. Smarter Allocation of Resources and Reduced Stock Levels

Inventory is a prominent item on the balance sheet of a business handling large stocks.

Every item in the inventory is worth a specific amount of money. The value of each item is recognizable by its price and the number of units available to purchase. The goal is to keep the lowest stocks and not compromise availability. It frees up capital to utilize in other aspects such as growth and expansion.

5. Resolves Unforeseen Issues

Automated inventory visibility synchronizes the following process;

•   Production
•   Sales
•   Financial management
•   Warehouse management

It’s possible to track the movement of each item, with accurate reports and data updated in real-time. This also benefits businesses by helping personnel stick to movement plans and routes.

Data about material availability and real-time manufacturing conditions is instrumental. It can go with delivery dates to improve cost-efficiency and customer satisfaction.

6. More Accurate Inventory Levels and Improved Customer Relationships

Inventory visibility promotes understanding of online point-of-sale transactions. It shows;

•   Shipping data
•   Procurement
•   Production data

Decision-making based on data improves relationships with customers and vendors. It’s possible to track inventory availability at different locations. Meeting customer demands on time increases profitability as well.

7. Drives Multi-Channel Growth

Inventory visibility facilitates the management of inventory in many locations and channels. Automating the process means one can fulfill sales orders from many sources on time.

It also advances cross-channel inventory movement.

8. Locates Inventory Nearer to Customers

For faster, cheaper shipping, ensure the right inventory is in the correct location.

Have several fulfillment centers and retail locations for easy customer access. This is especially important for international customers. It reduces delivery time across geographical areas like North America and South America.

Having many fulfillment centers also lowers the transportation and delivery costs. The extra profit returns to the business and passes on to the customer, for example, free shipping.

Integrate an order management system (OMS) into many fulfillment centers. This will check stock levels in several locations.

Select a fulfillment center closest to the customer and send order details there. The stock levels automatically update across all the channels.

Common Challenges in Inventory Visibility and How to Solve Them

Poor Inventory Accuracy

Poor inventory accuracy comes up when personnel fail to understand the current networks. This includes customer needs and expectations.

Proper use of modern technologies and data-driven processes increases accuracy.

Automated inventory visibility minimizes costs. It also supports accurate forecasting to improve supply chain performance.

Inefficient Warehouse Layout

A disorganized warehouse layout can often cause inventory control problems.  Disorganization results in inefficiency in the supply chain.  

Poorly planned layout delays pick-up time for orders. Rearranging the warehouse helps mitigate this. It’s advisable to use the First-In First-out method.

Improper Space Utilization

Inadequate space utilization reduces the efficiency of a warehouse. Higher inventory storage costs and errors are a possibility.

An inaccurate inventory count can lead to premature restocking, affecting the cash flow.

Redundant Processes

Outdated and repetitive processes lead to reduced inventory accuracy. For instance, counting and updating inventory manually. A great solution is using barcodes on products and automating cycle counts.

Neglect of Picking Processes Automation

Optimizing the picking processes eliminates the possibility of inaccurate orders. It also ensures a continuous cycle count, and achieving it utilizes;

•   Waveless picking strategies
•   Voice-enabled technology
•   Handheld scanners

Methods of Increasing Inventory Visibility Across Supply Chain Nodes

Improving Inventory Visibility at Stores                            

Automation within inventory visibility lowers the costs of maintaining visibility. It offers an opportunity to improve accuracy over the entire supply chain.

Most customers check out the desired products online before making an in-store purchase. For this reason, the online store inventory should reflect what is in the walk-in store.

Take, for example, a product description in our catalog. Customers feel let down when they visit stores to pick out of stock items. They will lose trust in us for disappointing them, wasting their time and money by coming to our store. Lack of inventory visibility will cost us sales and repeat business.

Inventory management software (IMS) is a great option for businesses. It provides real-time tracking of the inventory and integration with back-office systems.

How Does an IMS Benefit A Business?

The right inventory management system indicates an accurate number of products available. Reports consist of both online and in-store. It also facilitates rapid adaptation to any shifts in demand. Smooth operations enable easy hustle-free movement of products from other locations.

Proper inventory management also helps us identify the best performing products. This makes the decision-making process is easier for everyone involved.

Enhancing Inventory Visibility at Distribution & Fulfillment Centers

Suppliers, manufacturers, and third-party logistics (3PL) providers should all have inventory visibility. It makes it possible to determine how fast a product moves over time.

This allows adjustment to the inventory level depending on demand. It makes it easy to perform quality control assurance and manage resource allocation.

Warehouse management systems (WMS) assist suppliers, manufacturers, and 3PLs to enhance visibility. They can gain control over warehouse operations using one interface. A good example is shipfusion. Integration measures include procedures such as monitoring;

• Product quantities
• Cycle counting
• Picking
• Packing

The WMS will use data collected to enhance warehouse efficiency and recommend improvements.

Improving Inventory Visibility in Transit

Getting delivery right the first time is essential to minimize unnecessary returns. Inventory visibility makes it possible to track products in real-time while in transit.

The Transportation Management Systems (TMS) design is to manage transport operations. They allow real-time visibility of the shipping process, tracking, and updated reporting.

In the United States, TMS is a software system that manages transportation operations. This can be;

•   Real-time visibility of the shipping processes
•   Tracking status
•   Updated reporting.

A good TMS should;

• Automate transportation margin management
•  Refine internal business processes
• Provide analysis into transport costs
• Measure important business performance indicatorsü  Optimize transportation by consolidation tactics and strategies that point out low-cost carriers.

Shipfusion sets your business on autopilot and combines flexible, reliable fulfillment with powerful, real-time technology. Shipfusion has multiple fulfillment centers across the US and Canada– making it easy to manage your eCommerce business. For more information on how to set your business on autopilot, contact one of our fulfillment specialists today.