With the significant disruption in the supply chain this past year, many companies are looking to invest in technologies that will automate replenishment, management and optimization of their inventory. They want an app that squeezes every bit of cash out of inventory without affecting service levels, so they can manage orders easily without either overstocking or running out of stock.
This goal is possible when you invest in technology that automatically replenishes inventory from multiple vendors based on actual usage data, not on complicated algorithms or predictions. The advantage of an automated replenishment system is that quantities, usage and demand are constantly monitored, taking the task out of human hands and automating the process. Selecting the right automated replenishment system can:
- Increase visibility and monitoring.
- Execute replenishment based on actual usage, not on forecasts.
- Increase flexibility in dealing with unpredictable demand.
- Optimize alternative sourcing strategies.
- Enhance network flexibility with integration to ERP systems.
- Data analytics with increased reporting capabilities.
But not all apps are created equal. Due diligence on any software under consideration, plus the company that provides it and their expertise in inventory management, is key in selecting the right app for your organization. Here’s a checklist of must-have features for inventory replenishment:
Dashboards – Having real-time visibility into data is vital. Any replenishment app you consider should be able to provide critical data at a glance such as total inventory value, inventory turns, category/supplier allocation, and the number of stock-outs that month, whether they’re in a stockroom or service truck. It should also provide the ability to set customizable alerts to notify you when action is needed to keep inventory levels optimized.
Ease of Use – The app must be user-friendly, while being easy to implement, access and navigate. It should also allow you to place orders easily and quickly.
Usage-based Replenishment – Meeting a fluctuating demand for product is difficult with software that aggregates past orders to make assumptions about future demand. A usage-based replenishment app allows you to optimize inventory quantities and prevent overstocking.
Supplier Independence – The app should not require you to “partner” with specific suppliers; instead, the user should be able to order from multiple suppliers. An app that can integrate data from multiple vendors and enable the user to order, track and replenish inventory from all those suppliers will be much more valuable.
Online vs Offline Data Input – While some apps tout the importance of operating online, many companies with service trucks know that their techs often service remote areas without Wi-Fi, which renders the app unusable at that time. The app should be usable no matter where trucks are and staff should be able to scan and work, even in rural areas.
Configurability – The app should allow you to customize with your industry or company terminology and to configure reports so data is displayed to your preferences. Users should be able to choose barcode label sizes and formats (QR codes vs linear barcodes) and add images or descriptions to part numbers.
Kitting - The app should provide the ability to pre-assemble kits under one SKU for specific needs. For example, service truck technicians spend less time at the job site when all the needed parts for the repair job are pre-assembled into a kit. Manufacturers can order kits that have all the necessary components for a specific task on the assembly line.
Work Orders – A good replenishment app should give you the ability to create work orders for a number of uses, e.g. grouping the consumption of parts, kits and labor that are used by a contractor to install or repair something at a customer; grouping together items used for a phase of a project for reporting purposes; or documenting what maintenance was done on an asset, such as a machine, service truck or forklift. The ability to create work orders, plus add photos of work done and collect signatures when customers sign off on the work is valuable in any app you consider.
Optimized Inventory – The app should not only provide you the ability to replenish inventory easily and quickly, but to optimize inventory levels so you save cash and reduce carrying costs. The app should allow users to track on-hand quantities and usage at your site or your customer’s point-of-use, providing valuable data to know just how much inventory is needed, and no more.
Track Serial and Lot Numbers Plus Expiration Dates – It’s critical that the app be able to assign and track serial and lot numbers. Any company that deals with products that degrade over time must be able to manage lots to use their oldest products first. And companies that must track their inventory for their end customers, such as the medical equipment or hose assemblies for the oil and gas industry, must be able to generate and track serial numbers and expiration dates.
With lead times still extended, and demand uncertain, many companies are rightly looking into software and apps that can help them better manage those fluctuations and gain the visibility they need. Make sure you’re doing your due diligence to get the right solution.
Rock Rockwell is CEO of eTurns, a point of use inventory management app that automates inventory replenishment.