Multilocation inventory management can be a tough task for any growing manufacturer with production sites spread across multiple locations. But seeing sales reports read sweeter when there is steady growth makes it a sight worth striving for in the manufacturing business world. However, success brings challenges and one of the main obstacles that operation global manufacturing businesses will encounter is managing stock in multiple locations.
The difficulties in managing stock across multiple locations require extra storage, proper tools, and a production schedule that works around the clock to avoid risks of suffocating the stock room. This could be a tough hill to climb without smart manufacturing software that can pinpoint and solve precise issues. In today’s modern world, where manufacturing businesses are expanding globally, mastering multilocation inventory management is key to staying ahead of the competition. Let's dive into how multi inventory management can be mastered with some tips and tricks.
Why do businesses need multi inventory management?
As a business expands, it may find itself requiring multiple sites or locations to handle its operations. With this expansion comes the challenge of managing inventory across those locations. It's not an easy task, especially if the business has an incredibly wide range of products and services. Multi location inventory management becomes necessary in such cases.
Inventory isn't just about counting products on hand; it also involves tracking their movements from one location to another. A business needs to know where each item is at any given time so that it can manage inventory effectively. This is where multi inventory management comes into play. By tracking inventory across multiple locations, businesses can ensure they have the right amount of stock in the right place at the right time.
Big hitters in the retail industry have been using multi location inventory management for years now because they understand its importance in improving customer satisfaction and increasing profits. Managing inventory over thousands of meters squared requires precision and efficiency, which can only be achieved through a robust system that monitors stock levels in real-time. For any business looking to expand or improve its operations, investing in multi inventory management is essential for success.
1. Sync with manufacturing
One of the biggest challenges for multi-location inventory management is syncing with manufacturing. With multiple manufacturing sites due to the skilled labor rent costs, it can be difficult to ensure that each site has direct access to the same information. Manufacturing businesses find themselves constantly struggling with keeping production line moving smoothly and ordering materials in a timely manner.
Manufacturing routing is an essential element when it comes to syncing with manufacturing. Without proper routing, national lines would not have a clear understanding of what needs to be produced and when. By having this information readily available, businesses can streamline their ordering process and reduce wait times for materials. Ultimately, syncing with manufacturing is crucial for any business that wants to maintain efficient operations across multiple locations.
2. Outsource manufacturing
Outsourcing manufacturing has become increasingly popular in recent years, as companies domestically and globally look for ways to manage production without investing hefty resources. Contract manufacturing allows for a limited set of companies to totally manufacture their products globally, while others opt to outsource certain parts of their production process. By doing so, they can free up internal resources and focus on core competencies such as marketing and sales.
When it comes to multi-location inventory management, outsourcing manufacturing can provide several benefits. It enables businesses to streamline their supply chain by reducing lead times and minimizing the risk of stockouts. Additionally, outsourcing can allow for better control over production status and purchase materials by leveraging the expertise of experienced third-party manufacturers. Despite some potential drawbacks such as quality control issues or communication challenges, many businesses find that the advantages outweigh the risks when it comes to outsourcing manufacturing.
3. Potential to lower costs
Multi location inventory management has the potential to significantly lower costs for businesses. By holding inventory in multiple locations, companies can reduce shipping costs and order fulfillment time. This is especially important for businesses that have a high volume of orders or customers located in different geographic regions.
With multi location inventory management, businesses can strategically place inventory in secondary warehouses closer to their customers. This reduces delivery infrastructure costs and allows for faster deliveries, which can ultimately satisfy customers and increase sales. However, it's important to note that the effectiveness of this strategy may vary depending on the specific business and its operations. Higher costs may be incurred if proper planning and execution are not followed.
4. Retailer or reseller inventory
When it comes to multi-location inventory management, retailers and resellers have different options for managing their inventory. Retailers typically own the inventory they sell, while resellers may sell part of their inventory on consignment through a consignment inventory agreement. As a pro tip, it's important for both retailers and resellers to track inventory across all locations to accurately manage stock levels.
One helpful tool for tracking inventory across multiple locations is using a free manufacturer inventory spreadsheet template. This template can be customized to fit the needs of your specific consumer business model, making it easy to keep track of stock levels and sales data. Whether you're a retailer or reseller, properly managing your inventory is key to ensuring customer satisfaction and maximizing profits.
Challenges of multi-location inventory management
Multi-location inventory management means syncing inventory management across multiple facilities to bring products closer to end customers. However, this process comes with a few challenges that need to be addressed. One such challenge is storage capacity. Managing large numbers of goods ensuring that they are available when needed can often lead to occasional overstock, which requires buffer warehouses or transit warehouses.
Having buffer warehouses and transit warehouses is a good option for managing occasional overstock, but it also comes with common drawbacks. One of them is the need for seamless communication between all logistics facilities. Without proper communication, there is a higher risk of bottlenecks occurring which can delay the movement of goods and result in a higher delaying cost. Additionally, duplicate orders may be placed due to poor inventory control.
To effectively manage these issues, businesses must invest in inventory management software that helps track inventory levels across multiple locations in real-time. This software prevents errors and ensures customer receiving accurate orders while reducing the high price tag associated with manually managing multiple facilities. With the right tools in place, businesses can streamline their operations and optimize their logistics facilities for better productivity and profitability.
Multilocation inventory with smart manufacturing software
Multilocation inventory management can be a nightmare for manufacturing businesses trying to manage stock and production scheduling across multiple sites. It's all too easy to lose track of where materials, finished products, purchase orders, and sales orders are in the entire order fulfillment process. That's where Katana smart manufacturing software comes in. The all-in-one solution tackles inventory production on a single visual platform that includes support for multilocation inventory management.
With Katana, stock moves between locations separately so you don't have to worry about totally losing track of your inventory. When an order comes in for manufacturing, the software creates a manufacturing order that lets you quickly make sure you have everything you need to fulfill it. If any locations are running low on materials or finished products, they're reduced automatically from the available stock transfer options.
The production schedule is updated automatically based on the availability of materials and floor-level control of production scheduling software functionality. This means that you can sync accounting, e-commerce platforms like Shopify and WooCommerce with efficient material purchasing plans to lower costs, improve efficiency, and most importantly grow your business as fresh markets lay ahead. Start using Katana today for on-demand access to multilocation inventory management that eliminates constant tedious calculations altogether. Check out our video explaining Katanas multilocation features!
Maximizing Profits with Multi-Location Inventory Management
Multi-location inventory management is the process of managing goods across multiple warehouses due to the need for speedier deliveries, enhanced customer satisfaction and lower costs managing goods. Good news is that multi-location inventory management software streamlines product distribution and cuts costs. Multiple warehouses facilitate a smooth supply chain, which results in quicker deliveries and greater customer loyalty. E-commerce retailers have adopted this flexible organization criteria adapted to specific regions, where customers can order online and receive their product from the warehouse closest to them.
Consulting firm McKinsey has found that companies distribution costs decrease when they open warehouses in different regions of the country or city brings down the miles companies travel to deliver orders. The management software gives full control over the streamlined operations, making it easier for companies to manage their inventory levels. Small warehouses located nearby make it easier for a company to deliver orders on time, resulting in an enhanced customer experience that fosters future sales.
The multi-location inventory management setup also has a positive impact on reducing a company's carbon footprint by lowering emissions from polluting gases emitted during transportation. A McKinsey study mentioned that having a facility located close to customers reduces the miles companies travel and lowers emissions while fostering green logistics. Micro-fulfillment centers are being set up in many cities across America as well as other countries around the world as an effective way of cutting delivery times while lowering costs associated with long distances traveled between warehouses and delivery destinations.
How to master wholesale order management with the right software
If you're in the business of bulk selling, efficient wholesale order management is critical to your success. The right inventory management software can help you streamline your operations and avoid common pitfalls. To master wholesale order management, choosing the right software is key.
The top 10 well-integrated wholesale order management software options provide a range of features that can help businesses learn how to effectively manage their inventory. These systems are designed to automate many aspects of the ordering process, including tracking sales and shipments, managing inventory levels, and processing payments. By using these tools, businesses can improve their efficiency and accuracy, reducing errors and minimizing delays.
Integrating manufacturing software with your inventory management system is also crucial for effective wholesale order management. With this integration, businesses can track materials used in production and better plan for future orders. This not only streamlines the ordering process but also helps manufacturers optimize their production processes for maximum efficiency. By utilizing powerful manufacturing software alongside their inventory management system, businesses can take control of their supply chain and achieve greater success in bulk selling.
Frequently Asked Questions
What is multi-channel and multi-location inventory management?
Multi-channel and multi-location inventory management is the process of keeping track of inventory across multiple sales channels and physical locations. It helps businesses avoid stockouts, reduce overstocking, and improve fulfillment efficiency.
What are multi-location inventory management KPIs?
Multi-location inventory management KPIs are key performance indicators used to measure the effectiveness of managing inventory across multiple locations. These metrics help businesses optimize their inventory levels, reduce waste, and increase profitability.
How do I manage inventory that moves back and forth?
To manage inventory that moves back and forth, establish a system to track the movement of items in and out of your stock. Utilize inventory management software to keep accurate records and ensure you always have enough product on hand.
What are the benefits of multiple location inventory software?
Multiple location inventory software allows businesses to efficiently manage inventory across multiple locations, reducing stockouts and overstocking while improving order fulfillment and customer satisfaction. It also enables real-time tracking of inventory levels, reducing the risk of errors and improving overall inventory accuracy.
How to manage multi location inventory?
To manage multi-location inventory, you need to have a centralized inventory management system that allows real-time tracking of stock levels across all locations. This enables efficient stock replenishment and reduces the risk of overselling or stockouts.