A subset of supply chain management, inventory management helps enterprises track the various aspects and stages of a product or inventory — such as the inventory level, orders, sales and deliveries. An inventory management system also generates work orders, receipts and bills of materials, amongst others, for the smooth and efficient operation of the business.
In simple terms, inventory management is the process through which a business determines what supplies to order and how much of each to order at any given time. You can track your stock from when you buy it until you sell it.
Supply chains rely on a centralized inventory as it is the hub where all links in the chain are connected. A business needs to have adequate inventory management to prevent the accumulation of surplus goods at the business; at the same time, it needs to fulfill the requirements of clients.
As a critical supply chain component, inventory management encompasses a variety of distinct aspects — such as the control and supervision of purchases made from both suppliers and customers, the control of the amount of product that is available for sale, the maintenance of storage facilities, and the fulfillment of orders.
Fulfilling a customer's expectations is a crucial part of customer experience. It encourages clients to remain loyal to a brand and assures their continued patronage of the company. It is therefore essential to meet customer commitments and deliver orders timely if an enterprise is serious about expanding its business.
Explore GEP’s inventory management software to learn more.