Imagine you’re shopping for boots for an upcoming ski trip. You find the perfect pair, complete the purchase, and get a confirmation email that says the boots should arrive the day before your trip.
But as you’re packing up your gear, you get another email. This time, the news isn’t good: Your size is actually out of stock, so the ski trip will be long over by the time the boots finally appear on your doorstep.
This type of scenario is frustrating for customers and bad for business. And while holding onto extra inventory might seem like the solution as a business owner, that puts you at risk of accumulating dead stock that lingers in your warehouse, wasting money and taking up space.
What you really need to prevent costly overstocking and stockouts is a holistic view of your inventory, from the supply chain to the customer’s door. Here’s why — and how — to get the inventory visibility your business needs.
What is inventory visibility?
Fulfillment issues like the one above happen when a business’s inventory management system doesn’t provide real-time visibility across all its channels. Inventory visibility is like having a live, interactive map of every product and its stock levels. But it goes even further than that, providing insights like:
- Sales trends: Knowing which boots are flying off the shelves and which are collecting dust helps the business anticipate demand and keep the right pairs in stock.
- Potential problems: The shop knows if a particular size is running low, a shipment is delayed, or the popular limited-edition boots are about to sell out.
- Past performance: With historical data on sales patterns and customer preferences, the shop can make smart decisions about which items to stock up on for next season.
Having good visibility into your inventory doesn’t just apply to the finished goods you have ready for sale, and it’s not just for retailers. Visibility is also vital for the parts, components, and raw materials used to manufacture or assemble those finished goods.
No matter what type of business you run, inventory visibility in your supply chain and internal operations is a must for effective inventory control, timely order fulfillment, and a customer base that keeps coming back for more.
7 benefits of good inventory visibility
Accurate, real-time inventory visibility gives you the insights you need to optimize your entire operation. Here are some of the biggest benefits.
1. Reduced costs
Improving visibility makes overstocking, stockouts, and dead stock a thing of the past. When you find the sweet spot of “just right” inventory levels, it’s easier to minimize storage costs and prevent lost sales.
2. Improved efficiency
Knowing exactly where each item is and when it’s needed leads to faster order fulfillment and smoother production planning. And since time is money, becoming more efficient has a big impact on your bottom line.
3. Happier customers
When your inventory data is accurate and up to date, you send fewer “we’re sorry” emails — and the positive customer impact is undeniable. Fulfill orders more quickly and accurately, and build customer trust and loyalty by informing shoppers about product availability and realistic delivery times.
4. Data-driven decisions
Having access to real-time data and historical trends leads to more informed choices about purchasing, production, and distribution.
5. Increased agility
No more wondering why competitors are always one step ahead. With a clear view of your inventory, you can easily adapt and adjust strategies, responding quickly to changes in demand, supply chain disruptions, or emerging trends.
6. Waste reduction
Good inventory visibility helps you closely monitor inventory levels and expiration dates, making it easier to minimize waste from spoilage or obsolescence.
7. Enhanced collaboration
Improve communication and collaboration across departments, suppliers, and fulfillment centers by sharing real-time inventory data. Foster transparency and strengthen relationships.
Common inventory visibility challenges
The benefits of inventory visibility are clear, but achieving it does have its challenges. Here are some common hurdles businesses face:
- Inaccurate data: Manual data entry, inconsistent tracking methods, and outdated systems can lead to errors and discrepancies.
- Siloed information: Inventory data scattered across multiple systems creates a fragmented view, making it hard to get a complete picture.
- Lack of real-time updates: If your inventory management system doesn’t update in real time, you face inaccurate stock information and missed opportunities.
- Limited tracking capabilities: Basic systems often lack the ability to track inventory across the entire supply chain, including goods in transit or at external locations.
- Lack of visibility into 3PL inventory: It’s often challenging to access and integrate real-time inventory data from third-party logistics (3PL) providers.
- Human error: Manual processes are prone to mistakes, which impact inventory accuracy and lead to costly consequences.
- Poor communication: Ineffective communication between departments, distribution centers, and partners often leads to misunderstandings and delays.
- Rapid growth and change: Your existing inventory management system might work for the business you have now, but systems and processes need to scale as you grow.
- Lack of standardization: It’s harder to achieve visibility when your processes and terminology are inconsistent between departments or locations.
- Cost constraints: Upgrading inventory tracking technologies and systems saves time and money in the long run, but the initial investment can be steep.
6 tips for improving your inventory visibility
Ready to reap the benefits of good inventory visibility? Here’s how to make it happen.
1. Embrace technology
Comprehensive inventory management solutions like Fishbowl offer real-time tracking, automated updates, and insightful reporting — all the tools you need for maximum visibility. Look for features like barcode scanning and real-time data synchronization across all sales channels and warehouses.
2. Centralize data
If you want good visibility, you have to break down information silos. Integrate inventory data from all sources — your online store, physical locations, and warehouses — into a single, centralized system. Eliminate discrepancies and get a unified inventory view.
3. Track everything
Finished goods aren’t the only things you need to track. Get eyes on raw materials, components, and work-in-process (WIP) inventory. This end-to-end visibility helps you anticipate production needs, identify potential bottlenecks, and improve supply chain management.
4. Automate as much as possible
Automating key processes like stock updates and replenishment reduces the need for time-consuming manual data entry and the risk of human error. With the right platform, you can set up automatic alerts for low stock levels, approaching expiration dates, or unexpected delays to avoid stockouts and keep customers happy.
5. Analyze and adjust
Don’t just collect data — use it. Regularly analyze inventory data to identify trends, anticipate demand, and optimize stock levels. Use historical data to forecast future needs, and adjust purchasing and production strategies accordingly.
6. Collaborate with partners
Share your inventory data with key suppliers and partners to improve communication, streamline deliveries, and prevent supply chain disruptions. With strong collaboration, you keep everyone on the same page and working toward a common goal.
Get a 360-degree view of your inventory with Fishbowl
Inventory visibility improves every part of your operation, from the supply chain to the fulfillment center. And Fishbowl makes it possible.
Fishbowl is the all-in-one inventory management solution designed to help you control stock, warehouse operations, manufacturing workflows, and more. The platform also integrates with QuickBooks to promote financial visibility.
Are you ready to gain end-to-end visibility of your inventory? Schedule a demo today.