In the food and beverage industry, market conditions and business models are ever-changing. Upon launching your own business, you are right to focus on building market share and creating sustainable business models. However, once the beginning stages are over, it’s time to think about scaling up, expanding markets, and increasing sales and customers. To achieve this, businesses must have software that quickly adapts to the needs of an expanding organization.
Inventory management is one area where “scaling” really counts. This might include expanding into new geographies, building an online presence, expanding new products and partners, or creating stronger alignments with suppliers and customers. In this article, we will discuss how to choose an inventory management solution that is flexible, scalable, and designed to help solve some of the biggest challenges many food and beverage distributors face today.
What is Inventory Management?
By definition, inventory management is the systematic process of product ordering, storing, and controlling. For optimal growth and efficiency, businesses must have the right quantity of products at the right time and place - all at the correct cost.
The first component to consider when choosing an inventory management system is the extension from the point of origin (the distribution center) to the end-user. Picture the consequences of overstocking due to the anticipation of future demand, only to end up with dead stock that will soon become outdated, or the opposing side - not having enough inventory. Next thing you know, a customer orders a particular product that you no longer have. Today’s inventory management systems are equipped with advanced technology, most notably their ability to scale. This enables real-time updates of stock and inventory to help with these challenges.
What is a Scalable Software Program?
In business, to “scale” means to grow or expand effectively. Moreover, in the software realm, a scalable system is one that doesn’t have to be redesigned to maintain high levels of performance when workloads increase.
These scalable software programs provide a plethora of benefits to a food or beverage distributor. For instance, if a distributor is just getting started, they should select a scalable inventory management system that provides only what the company needs at that time.
However, as the distributor starts to grow, the inventory management system must mature with it. Scalable software programs must prepare for future expansion by leaving the door open for ever-changing requirements and business environments.
Evaluate Your Current Software
Is your current software really configured for scalability? The leading food and beverage companies today are leveraging cloud-based software platforms with capabilities that expand to meet current and future needs.
For instance, say a distribution is using excel spreadsheet to track their inventory and they are constantly dealing with overstock or under stock. They are most likely dealing with an inventory management that doesn’t align with what’s really on the shelves. A company in this situation is probably losing money and customers.
Choosing The Right Software
While predicting the future is never an easy thing, it’s essential to identify any technology gaps and review the future plans that will set you on the right path. Some questions to ask include:
- What am I using right now, and how is it working for us?
- What are our current solutions’ limitations?
- What will you need one to five years from now?
Work through these questions honestly to get a clear picture of the company’s current inventory management needs and what you think you’ll need in the future.
The Right Products at the Right Time
As you can see, if you don’t have an automated inventory management system in place, it will be difficult for distributors to expand and gain more market share. Moreover, food and beverage distributors will always be held back by the number of people it takes to manage all of the manual inventory processes.
With a cloud-based, automatic and accurate inventory management software, distributors can effectively reduce costs, minimize waste, meet customers’ expectations, and predict future demands. These efforts combined will help maximize profits while minimizing inventory investments. In this on-demand business world, the ability to easily scale your business is a must-have for any distributorship.