If you want to truly grow your organisation, you have to be prepared for the growing costs of doing business. While your ERP system will give you a powerful solution to improve processes and strengthen the lines of communication with customers and suppliers, you also have to take a look at operations to get a better understanding of where you can reduce costs.
It’s critical to look at forecast demands to trim funding on the costs of carrying inventory, but manufacturers also can’t afford to have too little stock on hand or else their clients will turn to competing firms.
Inventory management is an opportunity to streamline costs
Being able to properly understand inventory expenses can give organisations the opportunity to get a leg up on others in the industry. An article for CIO magazine stated that optimising your warehousing costs is made easier by adopting an ERP solution that allows top executives to collaborate on holding the right amount of stock.
“The best way to do this is to keep inventory as low as possible by implementing systems that allow you to treat your warehouse as a node in the link between your supplier and customer, and not as a home for goods,” according to the magazine.
ERP systems can also decrease the costs of inventory management by providing insights on slow moving stock, said CIO. This data will give decision-makers the opportunity to change their orders in a way that allows them to meet demand while conserving money.