Having an optimum inventory is the idlest thing every company wishes for. To achieve this, manual methods of managing inventory level isn’t just enough. Which is why companies need to have a Re-Order System in their ERP.
A reorder system analyzes the flow of stocks in and out of the inventory. Once the analysis is done the system fixes a reorder point. After the point is fixed it turns easy to maintain the inventory at an optimum level. Knowing the reorder point is extremely important as overstocking can lead to unnecessary expenses and understocking can lead to loss of sale.
Let’s understand some of the benefits a Re-Order system has:
- Costs like storage cost, carrying cost, delivering cost, logistic cost, etc are involved when maintaining an inventory. This is why ordering at the right time helps an organization save a lot of finances.
- Know when a stock has to be re-ordered before it gets exhausted, this prevents losses and ensures smooth operation.
- The report contains details about every item and every location. Decisions regarding which item at which location needs to be restocked can be taken using these reports.
- Always the best solution for maintaining stock levels that have different types of products.
- It takes time to refill an inventory, with the reorder system companies can order items well in advance.
- The system is responsive to fluctuating demands.
- Companies can tackle unforeseen circumstances like delayed delivery, unexpected sale or changing trends.
Like Joseph Brandt says “Control the inventory – Control the profits”. Having a re-order system lets you have full control over your inventory level. It is like having a guarantee that a company will never get out of stock. This system makes everything simple and ensures that the company doesn’t go through unnecessary losses. With inventory always at the required level businesses can deliver an amazing customer experience.