Automation for inventory management has become more accessible over the past few years, leading to a sharp uptick in usage across a wide range of sectors.
Towards the end of 2019, the inventory management market was expected to double by 2025, while the software market that powers inventory automation was expected to reach $5 billion by 2026. That figure is likely to be much higher in the wake of the pandemic as businesses battle supply chain and staffing issues.
As inventory automation becomes commonplace, it’s easy to forget what it means for your business and the benefits it can bring.
What is inventory management automation?
Inventory management automation is the practice of using technology to manage inventory levels. However, inventory automation is more than just tracking how much stock you have in the warehouse.
An automated inventory management system offers enhanced warehouse visibility and a level of control that can open up a wide range of opportunities for businesses of any size. It allows companies to manage their stock levels in real-time without wasting time and resources on manual stock level checks.
Automated inventory management also offers greater accuracy compared to manual methods. If you’ve ever had a customer order an item that says “in stock” only to realise it’s unavailable, you’ll know the frustration of manual inventory management. You remove many of these issues that can harm your brand’s reputation by automating things.
Automated systems can also track product analytics to help businesses identify slow-moving inventory and reorder the best sellers before stock runs out.
Why is inventory automation useful?
As we briefly mentioned, inventory automation is more than an easy way to keep track of stock levels. It offers a range of benefits to help businesses function smoothly, save money and reduce wastage.
Let’s take a look at some of the benefits that inventory automation can bring.
Reduced human involvement
The pandemic forced us to take radical action and revolutionise traditional working conditions. Businesses were forced to adapt to reduced staffing levels as employees were forced to isolate or move to a work-from-home role. In some cases, companies discovered that it wasn’t just possible to function with a smaller staff; it improved processes and increased profit margins.
Introducing automated inventory management allows businesses to reduce personnel, which can help make your workplace safer and slash staffing costs.
Reduced human error
Humans are far from perfect, no matter how hard we try. Human error is generally considered an inevitability and can have widespread repercussions if not caught early. Something as small as miscounting inventory or forgetting to update the systems can mean the difference between an easy sale and a reputation-damaging customer complaint.
Automating inventory management removes human error and ensures your inventory reports are always up-to-date and accurate.
Reduced costs
Staffing and real estate costs are two of the most significant expenses any business will encounter. Inventory automation helps to reduce both of these expenses by allowing companies to manage their inventory more efficiently without needing a large team.
Inventory management software tracks stock levels in real-time and automates basic stock management processes. This also helps businesses to see which products aren’t performing as well.
Businesses can make data-driven decisions about their product line by tracking poor performers and optimising their warehouse spaces. This reduces the number of wasted resources, which translates into saving money.
Increase scalability
Automated inventory management solutions will benefit any business, but it’s especially beneficial for growing businesses. Optimised warehouses, reduced staffing costs, and simpler inventory management give companies plenty of breathing room to expand.
Increased scalability also allows businesses to quickly react to market changes and stay ahead of the curve. This is especially useful for companies that respond to seasonal changes and high-volume events like Black Friday sales.
How is inventory automation used in the apparel industry?
The apparel industry is one of the fastest moving markets, constantly adapting to new trends and seasonal changes. It’s an incredibly tough game to play, and even the biggest names can get it wrong from time to time. Inventory automation can help reduce the risks and keep your business running smoothly.
Improve inventory forecasting
One of the most significant risks in the apparel industry is an item going out of style before clearing through your inventory. Discounting those items can help, but discounted products mean reduced income. Ideally, you want to clear these items at full price to receive maximum profit.
Inventory management systems can provide insightful analytics that identify slow-moving styles. This can help guide your marketing team’s efforts and influence decision-making for similar situations in the future.
Automated stock tracking can also guide purchasing decisions by ensuring that you’re only reordering fast-moving lines. This can help build relationships with suppliers because you won’t need to make as many returns.
Reduce out of stock inventory
The last thing a business needs is a fast-moving garment running out of stock, especially if that item is available through your competitors. Out-of-stock items can frustrate your customers and drive them to take their business elsewhere.
Automated inventory solutions reduce the risk of missing sales due to lack of inventory. As the system tracks stock levels in real-time, you can purchase additional stock with plenty of time before your current inventory runs out.
Offer competitive pricing
It can be challenging to offer prices that compete with fast-fashion outlets, but inventory automation can help you stay competitive.
As we mentioned, inventory automation can help businesses reduce their outgoings. Lower staffing costs and a well-managed inventory can result in substantial savings you can pass on to your customers.
Increase customer satisfaction
Preventing out-of-stock items and keeping costs down isn’t the only way inventory automation can improve customer satisfaction.
As with any other industry, customer satisfaction is a key metric for successful businesses. Minor mistakes can have major effects on customer service rates, so it’s vital to keep mistakes to a minimum.
Automated inventory management systems use barcoding to identify and track items. Each item has its own barcode, which can be especially helpful when dealing with different sizes of the same design. The barcoding system substantially reduces the risk of buyers receiving the wrong products and increases overall satisfaction.
Save time and effort
Using paper pick tickets to pull orders may be a tried and tested inventory management solution, but it’s far from perfect.
Tickets need to be passed through various departments to complete an order. Not only is this a lengthy process, but it’s also far from reliable. As the order progresses through each department, the opportunity for mistakes increases.
Automated inventory management makes the entire process quicker and easier, because everything is handled digitally across multiple devices. You can even automate the entire process, so the second you receive an order, your product pickers get a notification telling them precisely what to look for.
Simplify your processes with Workhorse
With so many benefits for businesses and customers alike, automating your inventory management is essential for companies looking to maximise efficiency and stay afloat in a tough, fast-moving industry.
Workhorse offers affordable and simple inventory management tools for the apparel industry. Our modular, pay-as-you-go platform is flexible enough to fit any business and any budget.