How Does Better Inventory Management Aid Order Fulfillment?

Technology solutions can help distributors to better manage their inventory, which in turn improves order fulfillment and increases customer satisfaction.

Barcoding and radio-frequency identification (RFID) technology support inventory management by making the picking process more efficient. Inventory should be organized with barcoded storage locations and item numbers, which can be especially helpful for distributors with multiple warehouse locations. Systems that provide availability information across all locations allow distributors to fulfill orders more quickly.

RFID has become more popular in the past few years, but barcoding remains the preferred tracking method. There are barcoding applications that interface with NetSuite software and allow users to more efficiently process information and input data. Users can scan an item number and location, and the system automatically inputs the information, as opposed to manual data entry. These apps fit into the overall ERP system and provide more accurate data input and faster information processing.

Distributors can also implement fulfillment metrics, which can help them to better manage their operations. Here are three metrics to consider:

• On-time delivery: On-time orders / total orders shipped.
• Order fill rate: Orders filled complete / total orders shipped.
• Order cycle time: The number of days between the actual ship date and the order date.

These are just a few examples out of the many metrics distributors can implement; distributors need to determine their own priorities and develop metrics to track them. Building metrics into an ERP system provides greater visibility into the data, which aids in decision-making. Cloud ERP systems can help track and analyze these metrics.

Telltale signs within your existing system will show whether it’s time to upgrade to a cloud ERP solution to improve order fulfillment. Systems that use different software for different processes, for instance, are very limiting. The front- and back-end systems should not run separately, as an article on the NetSuite website explains. For example, accurate sales data should be used to support inventory management. If your system can’t support that kind of data-sharing, you should consider a cloud ERP upgrade.

Another sign your system is due for an upgrade is if it’s difficult to access information about the business. It should be quick and easy to pull data about average sales margins and other key performance indicators. Businesses need access to data to get a full picture of operations and make decisions based on the best information available. If information is stuck in silos and stored in spreadsheets, it means your system could benefit from an upgrade to aid order fulfillment.

Also, all financial data should be in a single database. If accounting is a long and difficult process, your system is holding your business back. Accounting staff should not need to reconcile financial information on different systems. A cloud ERP solution combines all financial data into a single system, which helps to improve efficiency.

The NetSuite website outlines three additional key benefits of upgrading to a cloud ERP solution.

1. Real-time business intelligence: You can customize your data to suit the needs of individual employees. This helps with decision-making by ensuring the right information is in the right hands.
2. Accelerated business processes: Whether it’s order management or procurement, a cloud ERP solution can speed up business processes. Customers appreciate it when their needs are handled quickly, efficiently and accurately.
3. Integrated suite: Having an automated, integrated suite will cut down on errors and inefficiencies caused by manual processes.

Staying up to date on technology is vital to surviving in today’s distribution industry. Cloud-based ERP systems that support effective inventory management make it easier to handle order fulfillment and better meet customers’ needs.