Any good CPG company knows that its products are its lifeline. Creating and delivering packaged goods to customers is what keeps them in business. Being able to move products into and out of processing centers and knowing what’s in stock is challenging, especially if there are literally millions of items to handle. Not being able to see what inventory items are on hand creates barriers to growth, excess waste, and even poor leadership decisions.
These visibility limitations create frustrations as companies increasingly look for ways to implement more efficiencies and save money while costs are soaring. Delays in delivery due to poor inventory planning often leads to poor customer opinion and even bad press. Let’s explore some of the options that CPG companies are using that help them break through these visibility limitations so they can continue to grow and innovate.
Updating Inventory Management Software
If your company is still using the same software that you’ve had since 1999, this is your sign that it’s time to update your systems. Too many companies rely on outdated technology when managing inventory. By updating processes and implementing newer inventory management software, businesses can gain more insight into their inventory than they’ve ever had before.
This is so important for CPG companies that need to have adequate stock on hand to fulfill customer orders and of course stock stores with food and toilet paper. Modern software helps to remove the guesswork and ensure more accurate ordering, planning, and accuracy. The reports produced by these systems allow leaders to make fast decisions if they need to increase or decrease stock based on customer trends.
Asset Tracking in CPG Inventory Visibility
Most CPG companies are managing multiple different types of inventory. Not only do they need visibility into their finished goods, but they also need to track raw materials, work in progress, and inventory related to operations. Tracking the right assets at the right time helps these companies make strategic decisions around planning and budgeting. Asset tracking makes companies more accurate and efficient which ultimately leads to lower costs and better customer service.
Software and better fulfillment processes are both crucial to improving asset tracking long term. Using the right software can give better insight into warehouse bottlenecks, dwell time, and even transfers between bottlenecks. By tracking where the stock lives and how it moves around a warehouse, it can show businesses if they have areas that need better processes or simply better staff training.
Creating Better Cross Functionality to Boost Inventory Visibility
Imagine a company’s marketing department gets a really great idea for a promotion and before they even checked to see how much inventory was on hand and how fast they could get more of it, they went ahead with the marketing plan. Thousands of extra customers see their promotion and decide to buy the product as a result. But the warehouse has no idea this has happened until thousands more units of a product starts to fly off the shelf. They run out without knowing what’s going on and customers get notifications that their shipment is delayed.
Inventory is more than an operations problem. It’s a whole company issue. When one part of the company isn’t in sync with the rest of it, inventory management fails to meet business goals. But when teams communicate and act cross functionally, the bottlenecks created by one team can be addressed and mitigated. For example, when communication between marketing and the warehouse stays fluid, they can have more open visibility into inventory in a way that aligns with marketing goals.
Using Accurate Data Analytics
Good companies rely on good data to make daily decisions. Companies that have the right facts analyze that data more effectively in a way that helps to improve inventory visibility. These businesses rely on mobile scanners in warehouses, accurate auditing, and good inventory management oversight to produce real time data they can use. If they notice a bottleneck in one area of the business, they use that information to make adjustments more quickly.
Bad information creates unnecessary risk in the business, leading to problems with order fulfillment, and the potential for dissatisfied customers. When products are consistently available, CPG companies are better able to handle products for promotions, and strengthen customer trust. By analyzing the data, these businesses have concrete numbers to work with and can ultimately make decisions that lead to continued company growth.
