One challenging aspect to the supply chain operation of your business is managing the inventory. Not having enough items on hand can slow or shut down production, cause order delays or missed sales. This can put you in the unfortunate position of dealing with angry customers.
Conversely, excess inventory takes up too much warehouse space. Add to that funds tied up instead of being used in other areas of your business. Perhaps getting a better handle on what you keep in stock requires vendor-managed inventory services.
Here are three things to consider about the advantages of using a program that forecasts the inventory needs of your business.
1. Lower Costs
Your business suffers when assembly lines get shut down because critical parts are out of stock. Managing vendor inventory can reduce costs associated with rush orders by ensuring you avoid stock-outs.
2. Reliable Data
Good software is synonymous with good vendor-managed inventory services. This enables you to make accurate forecasts to fill customer orders with real-time views of your actual demand. The result is a business that improves overall performance in the sales and supply chain departments.
3. Improves Efficiency
Reducing costs and using reliable data translates to improved efficiency in several ways:
• Shorter supply chain
• Fewer data errors
• Consistent inventory
Selecting a Vendor Inventory Management Partner
Before you sign up for vendor-managed inventory services, make sure you have an experienced partner. This service should have a clear understanding of your products and how your operations work to accurately forecast your inventory needs.
