What is ERP inventory management?
ERP inventory management, short for enterprise resource planning inventory management, refers to an integrated approach to business planning and operations. With an ERP inventory management system, businesses can manage all their finances, logistics, operations, and inventory in one place.
Sounds pretty great, right? There’s lots of potential value in using an ERP inventory management system, but is it the right solution for your business? Read on to find out.
Typical features of an ERP inventory management system
As you might expect, ERP inventory management systems are designed to empower businesses to manage not just inventory, but all business operations from a single location. Some of the standard features of an ERP inventory management system include:
- Stock tracking and management
- Sales and purchase order management
- Multi-channel order fulfillment
- Warehouse management and stock transfers
- B2B eCommerce functionality
- Payment gateway functionality
- Integrations with eCommerce, accounting, shipping and other operational tools
- Intelligence reports and analytics
And that’s just scratching the surface! No two ERP systems are exactly the same, but their shared purpose is to centralize and streamline all facets of a business’ operations.
Benefits of ERP inventory management
The potential advantages of ERP inventory management are far-reaching:
There are huge time-saving implications of using an ERP inventory management system. Managing operations using a centralized system not only cuts down on double-handling but also allows for automation of daily tasks. This translates to increase production and more accurate output in less time.
Every business owner knows that efficiency equals cost savings. Rather than paying for segmented resources or systems to handle different parts of the business, ERP inventory management systems handle many working parts simultaneously, reducing overall workload and minimizing expenses.
Supply chain transparency
A growing number of businesses are using shipping providers or 3PLs to outsource their shipping and logistics requirements. An ERP inventory management system enables you to integrate with external partners to ensure all systems communicate with each other. Stock, order and shipping information is therefore synced across the entire supply chain.
Accurate data collection and reporting
With key updates on stock, orders, and customers in a single location, ERP inventory management enables quality data collection. Most systems will also allow you to create and save custom inventory and sales reports to track business performance and plan for growth.
Enables business expansion
ERP inventory management systems are designed to reduce manual labor, by automating and streamlining processes – all of which goes hand-in-hand with growing a business. If scaling up locally or expanding internationally is on your radar, an ERP inventory management system can provide the space and freedom you need to grow.
Which types of businesses are ERP inventory management systems suitable for?
Generally speaking, ERP inventory management systems are best suited to medium or large businesses. This is because ERP systems are built for handling complex inventory and sales order processes, which usually apply to larger companies. Small businesses may not be able to justify the higher cost of an ERP inventory management system compared to a standard inventory management system, especially if the additional functionality and capabilities aren’t needed.
That said, ERP systems are made for efficiency and business growth, so they can offer plenty of value to businesses of all sizes. Ask yourself these questions:
- Will my business be expanding soon?
- Does my business have complex workflows?
- Do I need more advanced automation capabilities?
- Is my current inventory management system falling short?
If the answer to any of the above is yes, it may be worthwhile utilizing a robust supply chain management system with the capability to streamline and automate your end-to-end business processes.