Inventory Management Software Save Costs, Increase Efficiency, and Simplify the Auditing Process
As reported by iBenchmarking Warehouse Performance, less than 30% of the warehouses owned and/or operated by the United States are efficient. While the shipping and manufacturing industries are increasing their efficiency, much more could be done.
The Effects of Holding onto Extra Inventory
Companies are tending to hold onto extra inventory. In fact, the amount of inventory on hand, or the “days inventory outstanding,” has actually increased 8.3% over the past 5 years. It’s interesting to note that there are also 6.8% more warehouses located in the United States than there were 5 years ago.
As a result of this, a considerable amount of capital is sitting in warehouses. This translates into about $1.1 trillion being tied up with inventory as well as accounts receivable and accounts payable. Furthermore, retailers in the United States are literally holding onto roughly $1.43 in inventory for every dollar’s worth of their sales.
Inventory Tracking Methods and Systems
Over half, or 67% of warehouses, are planning to manage their inventory by utilizing mobile devices. Around 30% of the warehouses in the United States already have a warehouse management system installed. When considering that there are approximately 600,000 warehouse in the country, this can make a difference in how well these facilities are operating.
Warehouse Management Systems Can Reduce Inventory Tracking Errors
Recent statistics have shown that errors can be decreased significantly by using a typical warehouse management system. In fact, it’s been shown that these errors can be decreased by up to 70%. When warehouses utilize a warehouse management system, it can also increase inventory accuracy by roughy 20%.
Warehouse Management Systems Can Reduce Transportation Costs
Transportation costs are also an area that can be impacted by using a warehouse management system. It’s been demonstrated that these systems can potentially save companies between 10% to 20%. Given that the costs associated with transporting goods have recently risen over 10% of an order’s overall cost, this savings can make a difference.
Warehouse Management Systems Can Reduce Overall Operating Expenses
On average, it can usually cost 27% less to carry inventory when it is stored in an automated environment. Data shows that a company can experience up to a 35% reduction in operating expenses when they have a warehouse management system in place.
Warehouse Management Systems Assist with the Auditing Process
When you need to keep track of inventory to ensure you have enough supplies or for auditing purposes, what type of inventory tracking system do you use? Since this is particularly important for government inventory management, you want to have the most efficient and effective property inventory management software. Furthermore, this can also streamline the process when you can automate the audit process.