How a Cloud-Based Inventory Management System Works

Traditional inventory management can be one of the most painstakingly repetitive tasks for businesses. It is time-consuming, prone to errors, and can divert resources of the business that could have otherwise been used to generate a positive ROI, like building your brand, marketing, and R&D. 

With technology revolutionizing the supply chain landscape today, it is an absolute necessity for companies to move from traditional inventory management to modern cloud-based solutions.

The benefits of a cloud-based inventory management system 

Introduction

Cloud-based inventory management systems let you manage and control your inventory online, from any device, without needing to rely on location-specific systems for crucial data. 

Unlike legacy systems, cloud-based solutions eliminate the need for manual tasks, while improving efficiency, cutting down costs, and saving time. Companies that use paper-based tracking are bound to face mistakes and mishaps which can translate to a tremendous loss in sales depending on the situation.

Cloud-based inventory management software comes with powerful Artificial Intelligence and Machine Learning capabilities that could make accurate estimates about optimal inventory management based on existing data. Traditional inventory management on the other hand requires intuition, extensive business experience, and acumen to yield a reasonable prediction.

Since cloud-based solutions offer a range of features in a single centralized platform compared to traditional systems, businesses can perform their supply chain processes seamlessly. Coupled with improved data integrity and reduced risks, cloud-based inventory management software is a must-have in your tech suite. 

Key features

• Cloud architecture 
• Inventory optimization and tracking 
• Order management and fulfillment 
• End-to-end visibility 
• Real-time updates and syncing 
• Automated reordering
• Forecasting
• Report building 
• Secure data storage
• Accessibility across multiple devices

The benefits of a cloud-based inventory management system for your business 

Centralized data visualization and reporting 

Your inventory may be siloed in many channels – in stores, distribution centers, or offshore warehouses. Instead of having a bird’s eye view of the inventory you just have a keyhole view of a subset of it. By the time you do get an estimate of the stock levels this value may now well be obsolete.   

Cloud-based inventory management systems can give you an accurate snapshot of your inventory in real time, allowing you to track changes and take precautionary action as necessary. As a result, establishing one clear picture of your inventory allows you to better manage your fulfillment performance.

Analysis of historical data provides additional insight into your sales and inventory. Over time, this can help to improve forecasting, facilitate more informed decision-making, and contribute to a more resilient supply chain.

Powerful automation options

Cloud-based inventory management systems give you the luxury to harness the power of the latest iteration of Industry 4.0 tools such as Artificial Intelligence (AI) and Machine Learning (ML). By leveraging data that has already been collected, patterns and trends can be identified to construct accurate models which can be used to create forecasts.

Demand estimations allow for automatic inventory purchasing, avoiding over-purchasing, which can lead to excess storage costs and waste.

Manual labor can make up approximately 40-60% of a business’s operating budget. Automation allows workers to focus their efforts in other areas, allowing a business to cut down on inventory-related labor and manual maintenance costs. 

Higher data security 

Localized data storage is ultimately only as secure as the location in which it is stored. Even with proper backup, in the case of data loss, it can be time-consuming to reintegrate inventory information – during which time stock levels will likely have fluctuated, affecting your revenue. 

Cloud-based inventory management systems eliminate the need for manual backups on storage devices as all data is updated on the cloud  in real-time. Usually, cloud providers have multiple servers at their disposal, meaning that if a given server is under maintenance, you can easily access your inventory data and seamlessly sync it across devices instantaneously. 

The cloud prides itself on being highly secure due to its homogenous architecture. With numerous security features such as end-to-end encryption technology, built-in firewalls, and consistent security updates, the data in the cloud is highly resistant to hacking, virus infection, or access by unauthorized personnel.

Reduced error levels 

A cloud-based inventory management system requires little to no human supervision, allowing for the elimination of many of the traditionally inevitable issues related to human error.

The efficiency and productivity of human labor can be affected by a plethora of variables and it is inevitable to make mistakes when employees work around the clock. However, with the incorporation of systems that are backed by error-free algorithms, common mistakes like duplicate entries or misplaced items can be avoided with cloud-based inventory management.

This cuts down errors to a minimum. Since the data is shared seamlessly across many tools in the same platform even when a data mismatch does occur, it can be easy to pin down the source of error with a few clicks and make the necessary changes which will get updated across the entire system. 

Conclusion on cloud-based inventory management software and tracking solutions

Cloud-based inventory management software allows you to streamline your workflow, automate tasks, gain real-time insights, manage products across all channels and seamlessly access your data from anywhere.

To get started with cloud-based inventory management systems, download the white paper on MRO optimization today.