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Sage barcoding and Inventory Optimisation

What is inventory optimisation?

We have previously discussed in detail how inventory management can be achieved with Sage barcoding. However, even if you don’t currently use Sage barcoding, you probably already have inventory management practices in place, that are being implemented into your supply chain to enable you to manage your stock. In this latest blog we are going to dig a bit further into inventory management and investigate inventory optimisation, what it is and how can you utilise it.

Inventory optimisation is a method of balancing capital investment constraints and service-level goals over a large range of stock-keeping units, whilst taking demand and supply volatility into account. Sounds pretty complex right, but to put it into simpler terms, inventory optimisation is the implementation of processes to help you achieve the right levels and variety of inventory to meet your target service levels, whilst tying up a minimum amount of capital. You may recall that in a previous blog we investigated the costs associated with inventory, so how can this be achieved?

Inventory optimisation is achieved by accounting for both supply and demand volatility. By having the right stock control solution in place, planning for volatility is achievable for all businesses. Inventory optimisation is the next level of stock management for warehouses and supply chain managers and buyers.

Inventory optimisation with Sage barcoding will make you more competitive

Today we live in a world of disruptive technology, the rapid changes in the IoT, digitalisation, globalisation, and advanced technologies are shaking up industries and causing many to rethink the way they currently do business. Alongside this, consumer habits and behaviours are also changing and evolving rapidly, where consumers are looking for instant gratification and are more likely to look for elsewhere if stock is unavailable or they need to wait for delivery.  New technologies allow for the sourcing of more competitive and better products from all over the world, what do you do if your company or organisation isn’t at the heart of it all?

The simple answer is, failing to optimise your inventory means that you will fall behind your competitors. Complex and intricate global supply chains, where every aspect of an organisation is linked, leaves opportunities for failures, but those who are ready and can account for uncertainties will be a step ahead of their competition and more importantly, in a better position to meet consumer demand.

Big companies like Amazon and eBay already have advanced stock control systems in place for optimising the supply chain, allowing them to source products from all over the world and deliver to their customers – sometimes within only a few hours. Not only this, but they will also have the internal capabilities set up to monitor inventory levels and manage the movement of stock from warehouse to warehouse due to their stock control systems. But this is far from reality for many small- and mid-sized warehouse businesses (SMBs) who are still trying to calculate order quantities, safety stock and reorder points in Excel. Manually managing the supply chain often results in rough estimates for inventory quantities, which in turn can lead to excess inventory (that will eventually become obsolete) or, alternatively lack of stock and consequently poor service levels for their customers.

However, by utilising Sage barcoding technology you will be able to predict seasonal demands, track diminishing and new trend products, as well as set minimum and maximum stock level alerts. In previous times consumers would be willing to wait for the right product to come into stock, but in today’s competitive market and with the wide availability of next day delivery, you are more likely to lose that customer to another competitor if you aren’t able to deliver. After all, your competitor is just a click away.

Key elements of inventory optimisation

Determining exactly how much stock you need to order and when it needs to be ordered, means you can optimise your inventory to meet the demands of your customers. However, it is more of a science than a simple ordering system. Optimising your inventory with Sage barcoding technology takes seasonality and promotional campaigns into account, as well as monitoring supplier lead times and schedules. By staying on top of these fundamental trends and always having an insight, you will have much better control over your inventory, warehouse levels and will minimise the amount of capital you are tying up in stock. However, there are also other key elements that you need to consider such as Demand Forecasting, Inventory Policy and Replenishment.

 

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Demand Forecasting

There are different ways of forecasting demand, from qualitative forecasting, when historical data is not available for a product, to time series forecasting, for products with historical data which involves the comparison of two periods of time. While time series analysis, can be highly effective for identifying seasonal fluctuations and cyclical patterns, it can steer you in the wrong direction if used in isolation. Successful demand forecasting often relies on looking at both qualitative and time series forecasting. Looking at estimates of seasonal and demand trends should be an ongoing process of testing and learning. With Sage barcoding technology, you can analyse seasonal peaks and troughs through time series analysis, as well as identifying new trends to help you get a real insight into your warehouse.

Every product has a life cycle. When a product is first introduced to the market it will have no historical demand, therefore you will not have any historical data to compare it to. Therefore, you will need to look at estimates of trends for the product from market analysis, reviews and comparative analysis. From the introduction, most products move into to a positive trend of growth, where the demand is continually growing until the product reaches maturity and demands becomes stable. After reaching maturity, most product demand eventually becomes more irregular and finally moves into a negative trend of decline, where consumer demand is falling and the product becoming obsolete. The product lifecycle is a general rule of thumb and by no means a set lifecycle for all products in all industries, and can also be subject to change due to the revival of trends.  But to accurately forecast your demand, it is a good idea to know where your inventory is in the product life cycle and how it is moving through it.

 

Business and Marketing Concepts, 4 Stage of Product Life Cycle Chart on Black Chalkboard.

 

Another key factor to be aware of is seasonality. For example, a product where demands peak mainly in the summer, such as suntan lotion or sunglasses cannot be forecasted purely based on the previous year’s demand. Other factors need to be considered such as the predicated weather trends, the steady trade from holidaymakers, new products on the market and new competitors, as these factors will also influence the market.

To be able to effectively analyse the demand and manage your inventory levels to meet these demands, the right stock control solution can help you to find and analyse this information making it easier for you to optimise your inventory management.

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Inventory Policy

Another key factor in inventory optimisation is Inventory policy. Inventory policies are the guidelines and policies set for your business to ensure that your inventory is correctly controlled and cost and losses and shortages are minimised or prevented. Inventory policy may seem similar to forecasting demand; however, your inventory policy is the black and white of your warehousing and stock levels.

Your organisation will need to consider at what minimum stock level you will set your reorder points and what your order quantity will be when you hit that point. This will help your business to insure minimum stock levels are kept, to be able to cover a sudden peak in demand or supplier disruptions, which can simply sometimes be unforeseen.

However, even if your inventory policy is set and working, if you have multiple warehouses for your stock, it can be difficult to keep track of all items. Advanced functionality like our PSS Sage barcoding multi-location capability allows you to optimize your inventory and distribute it to the correct location, in the correct quantity. Making it easier to locate all of your inventory at any time, and helping you to fulfil your consumer demand.

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Replenishment

Last but certainly not least is stock replenishment. Stock replenishment uses your inventory policy and the minimum stock levels set to turn them into actual orders. For example, a typical replenishment model will choose the minimum stock value as the reorder point, and the difference between the minimum stock level and the maximum stock level as the target quantity to order. By implementing the right stock control solution, you won’t have to worry about doing this manually, as replenishment rules can be automated.

Replenishment is a crucial element to having the right stock, in the right places, at the right time. This is the foundation of inventory optimization. These calculations can be done in Excel and be manually entered into your ERP, but if you have a few hundred items in your inventory (or more!), it’s almost impossible to correctly track everything manually.

With a Sage barcoding stock control solution, your replenishment can be automated you only need to take action when the system alerts you. All you need to do is implement the right solution and watch the success unfold.

Choosing the right barcode stock control solution

Choosing the right barcode stock control solution can be a minefield and if you are currently already using a stock management system, how do you know if it is time to start looking for a better solution? Think about this, a customer places an order with your company, they receive an order confirmation which shows a summary of their order and delivery date. Sounds good so far, but when happens when there is a problem and due to old, outdated software or processes, and you need to inform your customer that an integral piece of their order is out of stock. This is not only frustrating for you and your customers, but it can also be detrimental to your operations and data accuracy. This begs the question: Do you have the right barcode stock control system?

Consistent inventory mistakes due to a lack of or inefficient stock management are not just an inconvenience, it costs you customers and revenue. But this doesn’t have to be the case for your business! With the right barcode stock control solution, this challenge can be avoided. Before you choose a stock control solution, it might be useful to ask yourself a few questions.

Business challenges

Are your operations inefficient?

Are your employees taking long periods of time to find inventory? This is the biggest sign that you need to be considering a barcode stock control solution. This can either be physically looking for stock in the warehouse or having to trail through stacks of spreadsheets to find out where the stock might be. Either way, your operations need improving.

Time savings is one of the main reasons many businesses choose to implement inventory software. With the right barcode stock control solution, you should see a decrease in the amount of time it takes to place orders, receive products, and pick, pack and ship products to customers, improving your operations as a whole.

 

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Is your productivity as good as it can be?

Inefficient operations and processes will inhibit your employees’ ability to get their job done properly. A key element when choosing a barcode stock control solution is that it is user-friendly, so your employees can be trained on how to use the new software quickly and effectively.

A better trained and more importantly, the better-managed workforce can save your business time and money in the long run. With fewer hurdles in their way and with little need to correct manual mistakes, your productivity will be on the increase.

By implementing a streamlined and intuitive barcode stock control solution, taking on temporary staff during your busy periods will be simple. With minimal training required on how to use the system, there will be less disruption to your business.

 

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Is your data is consistently inaccurate?

In an ideal world, your inventory records would be at 100% accurate 100% of the time, however, this is not easily achievable with the possibility of human error through manual stock management. The easiest way to achieve accurate inventory records is through the use of barcodes.

Our inventory management solution integrates seamlessly with your Sage accounts. Mobile technology enables your warehouse operatives to update your Sage stock records from anywhere in your warehouse. Giving your back office staff access to real-time information, allowing them to give up to date information to your customers as well as having as greater control over purchasing and management of your stock levels. Holding high levels of stock for low demand items or consistently running out of stock for high demand items does your business little good. Too much inventory ties up your cash flow and takes up valuable warehousing space, while too little inventory can be a missed opportunity if customers decide to look elsewhere.

 

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Software features that are critical for your operations

Inventory categorisation: This feature is essential if your business has to track inventory for high volumes of products, especially similar products that vary in size or colour. Without inventory categorisation, your warehouse operatives could spend a large portion of their time looking for the right product.

Sales/purchase orders: This one is a no-brainer. You need to have a stock control solution in place that will track your inventory from point of order to delivery and everything else in between. With the right barcode stock control solution, you will be able to achieve just that and stock levels will adjust dynamically as your inventory levels change.

A barcode scanner:  To run an efficient operation, you need access to data at your fingertips. Our stock control solution acts as a centralised hub via electronic identification to help quickly and efficiently scan items that are received, sold and transferred. Having real-time knowledge of back-ordered or out-of-stock items is extremely valuable. It can give your business a competitive edge as you can plan in advance for seasonal peaks, set minimum stock levels and provide your customers with real-time up to date delivery information.

Can your business afford not to have a stock management solution?

As we mentioned in our previous blog, there are many costs associated with inventory management. Inefficiencies and unproductive employees cost your business time and money. By implementing the right barcode stock control system, you can save your business far more money than what you’ll spend upfront, however, make sure you know what you’re looking for. At Bit Systems, we are the Sage software experts and we can help you figure out what the best solution for you. You might be surprised how quickly it can pay for itself.

Do you think that the right stock management solution could help your business to provide customers with a more efficient experience from start to finish? Chat to us to find out more.

We’re featured in Vida Unique

Here at Bit Systems, we’ve been really busy helping many different organisations from varying industries and sectors with streamlining their operational processes with our stock management, manufacturing and logistics software solutions.

It’s pretty obvious when our clients work with us how passionate we are about how our stock management solutions integrate into your business. We love it, even more, when we see you maximise your business potential and more importantly, gaining those financial rewards in return.

So we thought, why not raise our profile a little bit more and we have recently worked with Vida Unique, a modern lifestyle and business magazine to discuss how to run a more efficient business with barcoding stock management, manufacturing and logistics solutions.

Check out our article here.

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The benefits of Sage Barcoding for your Business

Barcodes can often be the most forgotten aspect of any product that a retailer sells. It’s easy to under-appreciate barcoding, the zebra-like aesthetics and the seemingly insignificant numbers, however, these aspects alone pack a powerful punch when it comes to stock and inventory management and they are ones that your business can easily benefit from.

We come into contact with barcodes daily, they are practically on every item we purchase, and yet, most of us have little idea what they’re fully used for, other than scanning an item at a checkout. However, by not exploiting barcoding technology, your business could be missing out on the many benefits of Sage barcoding, which can be easily integrated into your inventory management strategy.

Before we look any further into the advantages of Sage barcoding, it is good to get an understanding of what a barcode is and why it is so commonly used.

 

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The Barcode

Universal Product Code (UPC) is a barcode terminology that refers to the tracking of trade items in a store. A typical barcode consists of a unique 12-digit identification number that is assigned to each individual item of stock or category. These numbers are assigned by GS1, which develops and maintains the global standards of the shared language used between businesses when using barcoding.

Our Sage barcoding labelling software enables you to quickly generate GS1 compliant product labels, shelf edge labels or pallet labels ready to use when you are. You can even benefit from using both linear and 2D codes that incorporate a range of Sage fields such as product code, description, supplier code and standard prices.

 

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Why Sage barcoding is imperative for inventory management

Barcoding and inventory management go hand in hand. As imperative as this is to warehouse logistics and operations, the thought of the practicalities of integration alone can be enough to stop some organisations from considering this option. It is perceived by many warehousing organisations that use integration between their warehouse and their accounting solution would be a time consuming and tedious process. However, with Bit Systems PSS solution your warehouse and Sage accounting solution can be linked and integrated quickly and effectively, transforming your stock and inventory management processes into a seamless operation, that comes with key and beneficial features.

If you are not using a barcoding strategy to manage inventory, you may find that you need to set aside time for close down periods in order to perform a full stock take. While this may be standard practice for many warehouses, it can lose your business valuable trading time. Also, with manual stock-taking, the more stock to manage, the larger the opportunities for data entry errors, which can lead to inaccurate levels of reporting. With Sage barcoding, it significantly reduces the risk of these types of errors occurring.

With our Sage barcoding solution, your accounting solution will be turned into a powerful and centralised inventory management solution. This will enable your workforce to efficiently and simply capture stock transactions through a single system that automatically updates Sage in real-time. This is a return will help to drive your efficiency, performance, eliminate the duplication of tasks and reduce your stock count time by up to 90%.

 

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Benefits of Sage barcoding

When performing stock transactions, there are a number of stages where there is room for human error. This can be at the point of counting, the collation of stock quantities received on the sheet, as well as the inputting of the data into your accounts software. This can then lead to anomalies that may not be caught until after the stock transactions have been posted, which can lead to a “looking for a needle in a haystack” scenario. Time spent trawling through data can mean a waste of both resources and money for your business. This can be avoided by utilising a barcoding system to manage your inventory.

Cutting out a number of stages through the use of automation helps produce a more accurate and efficient stock transaction procedure. This also gives the supervising team more time to analyse the data as well as the ability to make business-critical decisions using Sage, as it now acts as a centralised hub for your data.

Our Sage barcoding solution processes stock movements and adjustments quickly and effectively. There is no need to double-check the data for errors, as it doesn’t require manual input because it integrates with your stock within Sage. By integrating the two solutions Sage becomes a centralised hub for your data storage, inventory levels and analytics of your stock.

 

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Leveraging the benefits

By using UPCs and barcode scanning abilities on your products, it will not only speed up your operations but will also improve accuracy. Our Sage barcoding solution is scalable, so it can grow with you as your business develops and expands. With the added functionality of being able to cater for your business if you expand to additional warehouses by managing multi-location sites, you can benefit from greater flexibility today.

Integrated Retail Epos Solutions

The need to knows of Retail EPOS Solutions

Most modern retail businesses will have retail EPOS solutions already in place, but is your solution offering you value for money and helping your business to grow? Have you ever considered an epos solution that synchronises and integrates with your accounting solution and the opportunities it could open for your business?

When you review and evaluate the different aspects that are needed to run a successful retail business, it can sometimes be tricky to identify what’s working effectively and more importantly, what isn’t when using a standalone EPOS solution. An integrated retail EPOS solution can give you a complete view of your processes, promotional success and user management control, that a standalone system wouldn’t be able to offer.

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A company and solution go hand in hand

Before you even start to consider a new retail EPOS solution, you need to be aware that your investment in a new solution should be more than just the product you’re receiving. You need to choose a supplier that can not only provide retail EPOS solutions for you but can support and work with you post-integration to work with your requirements and needs.

Bit Systems do not believe in a ‘one size fits all’ approach, because business requirements and specifications differ from company to company. Bit Systems work with our customers to identify what your business requirements are, so we can offer a more tailored solution and make sure your business really benefits from a holistic integrated system.

 

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Things to consider when choosing retail EPOS solutions

There are many factors to consider when choosing a retail epos solution and we understand that the amount of information and solutions available can seem overwhelming. The first question you need to ask when considering a new EPOS solution is how a new epos solution would benefit and help to grow your business?

Identifying where your retail operations need improving, and then aligning those issues with an epos solution that can help you to overcome those issues, helping to maximise sales and increase customer satisfaction, means that you are most definitely onto a winner. An integrated EPOS system can help to streamline your processes and reduce administration, which in return will increase convenience for your customers, improving their shopping experience, which then leads to an upturn in sales.

I’m sure most retailers would also see the benefit of having a responsive and intuitive user dashboard, with custom menus designed specifically for your business, not only benefiting your till operatives when trying to find the information that they need, but also improving your customers experience when at the point of sale or when just asking about a pricing or stock enquiry.

 

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Access to live data with retail EPOS solutions

One of the key benefits of having integrated retail epos solutions is being able to access live data at the point of customer contact. This means not having to wait for the customer or stock information, and having accurate and up to date data, reducing your customer waiting and queuing time. By integrating your EPOS solution with your accounting solution, your data will be up to date, accurate and won’t inhibit your customer journey when they are in store.

This includes real-time access to:

  • Customer balances
  • Customer credit limits
  • Inventory data
  • Pricing
  • Customer price-lists
  • Promotions and loyalty scheme data
  • Barcoding

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A centralised hub for information

Within the fast-paced retail environment, retailers need retail epos solutions that are secure and reliable and by investing in an integrated EPOS solution, you will be working from a single database, storing your data in a single system, so you can ensure consistency throughout your business. This seamlessly shared source of knowledge empowers your front-facing staff to know that the information they are working with is accurate and up to date at any time, reducing issues surrounding miscommunication. This central hub of information can also be used across multiple locations, to enable stock levels at each store to be updated.

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Valuable sales and inventory information

In-store customer experience should not be the only benefit of an integrated EPOS solution. Your EPOS solution should be able to provide you with important sales data, to enable you to focus your attention on improving your demand forecasting and stock replenishment.

Detailed reports will give you a bird’s eye view of your business – including which products are selling fast and which products are slow-selling, allowing you to make more informed decisions. By using these detailed reports you should be able to track profitability by a terminal, by product and by the department, helping you to improve scheduling, operational efficiency and profit.

By analysing these kinds of reports, you will be able to assess and answer commercial questions, such as are your marketing activities working? What are your peak selling hours? Do you need to increase staff during those peak times? Can you streamline your opening hours to increase revenue?

Further to this, these reports can also help with your inventory management, you can use predefined system alerts to help you operate at the optimal stock level. This will lessen your stock holding, and help break down inventory costs.

 

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What really matters?

However, the most important factor for any retail business is customer satisfaction and meeting the demand of your consumers. To allow your business to make the best decisions in regards to your customers, you need to have accurate and reliable data. By choosing the right epos solution for your business, you can put your staff in the best position to meet customer demands effectively and efficiently.

By choosing a solution that offers user-friendly interfaces that can be specifically configured to suit the needs of your staff and business, you will be able to accelerate your transaction processes, improve accuracy and help to meet your customer satisfaction levels.

By choosing a modern integrated solution, you can use the data collected to develop meaningful and customised marketing campaigns to target your customers with the right incentives at the right time, helping to boost repeat custom.

If you think that an integrated EPOS solution could benefit your business further, we look forward to hearing from you.

Sage warehouse management strategies

Do you have your warehouse management under control?

For those in the warehousing industry who carry non-perishable stock, it can be easy to overstock and carry extra inventory to help meet consumer demands over time. However, while this can benefit organisations in some circumstances, what if demand for stock fluctuates and you are left with not only leftover stock but more importantly your valuable cash being tied up?

If your warehouse pushes high volumes of stock in and out, then you need to be able to manage not only your costs but every level of the supply chain. A Sage warehouse management solution can help you to do just that.

 

Issues with carrying excess inventory

If you find yourself carrying an excess of inventory over the course of time, there will naturally be an effect on profitability and cash flow. Carrying high levels of stock at different pricing can reduce the amount of available cash flow and can incur high carrying costs and these are not the only inventory costs that you need to be aware of.

If you are holding high levels of stock for a product with low demand, you are in a position where you are holding stock that didn’t necessarily have to be there in the first instance. Without having a solution in place such as a Sage warehouse management solution, you may not have the capabilities to manage your stock levels, freeing up working capital and can run the risk of stock items becoming obsolete over time.

Detailed planning and more intelligent procurement processes can help to avoid costly mistakes and oversights. With a Sage warehouse management solution, there are strategies you can put in place to help increase inventory efficiency and eliminate manual data handling.

 

 

Reducing supplier lead-time with a Sage warehouse management solution

By having the right warehouse management software solution in place, managing the operational demands of your warehouse is simple. You can reduce supplier lead-times by knowing in advance when stock needs to be replenished, as you will be able to view real-time stock levels, giving you more flexibility when reordering and reducing your inventory carrying costs.

 

 

Centralising inventory control

By investing in an integrated Sage warehouse management solution and integrating your Sage accounts, you can have all of your data, analysis and real-time tracking of your stock in one central location, optimising your operations and reducing the risk of human errors from occurring. You can create more accurate reports, have safe stock levels for high demand items and streamline your distribution capabilities through business intelligence to maximise distribution between multi-location warehouses.

Reducing excess stock and eliminating obsolete inventory can reduce inventory issues, however, to really stay ahead of your competitors, it is essential to increase your warehouse visibility and to have the systems in place to assist with smarter planning. A Sage warehouse management solution can give you the perfect procurement tool to enable you to spend more time running a successful business and maximise your profitability.

The science behind impulse buying with Sage retail

How can Sage retail solutions help you?

Up to 60% of shoppers succumb to occasional spontaneous shopping sprees and purchases. But the question is, how can retailers trigger spending habits? In today’s blog, we are going to look into the science behind impulse buying a bit further and it’s the association with Sage retail.

A tried-and-tested marketing tactic that many retailers have relied on for decades is impulse buying. Traditional strategies have seen strategically placed low-cost items placed around ePOS systems. These well-placed, point of purchase displays are great for catching the eyes of consumers and triggering actions such as being reminded that they need a new pair of socks or realising that the chance to purchase a new chocolate bar that is on promotion that cannot be missed.

We can’t deny the fact that we are living in a digitally driven world and we definitely cannot shy away from the fact that e-commerce continues to drive consumers online. However, against the concerns that brick-and-mortar retailers will soon see a fade in impulse buying, we want to assure you this isn’t the case. You may ask why that is? Brick-and-mortar retail stores will always have one advantage over online stores, the control over in-store customer experience, for example, sales assistants offering samples of new perfumes or colognes or supermarkets offering a sample of a new dessert or beverage. But how can a Sage retail solution help you maximise on those purchases?

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Why is impulse buying popular?

Like most behaviours, we are conditioned in certain ways and this lives in our unconscious mind. Without getting into biology too much, there is a part of our brain that acts as a vault for automatic skills, information processing, dreams and intuition. You know that ‘gut feeling’ you get – it comes from your brain. So how does the brain use its vault? When we are shopping, we get a true ‘high’ when we acquire new things or even when we are window shopping imagine trying on new clothes or shoes. There is a release of dopamine which boosts your moods and gives shoppers a feeling of satisfaction. You’re probably thinking, why is this important but we’ll get into that a little bit later.

With a Sage retail ePOS solution, you can have these features instantly pop up at the point of purchase to enhance those consumer triggers. Innately, our drive to save time and money dates back to hunter-gatherer ancestors. Survival depended upon hoarding daily essentials and whilst we don’t face this threat today, that biological drive is still present. This is also a way in which retailers can position their products or service offerings as time and money savers.

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How a Sage retail ePOS solution can trigger these impulses further?

Human behaviour tells us that people will divert from the traditional shopping lists but they are more likely to do this in-store versus online. Great news for retailers! However, it can be difficult to inform customers while they are browsing the most relevant promotions for them. With a Sage retail epos solution, you can pre-program your ePOS solution so that if a customer buys one product, then they are offered a promotion that is complimentary alongside that product. With a Sage retail ePOS solution, you can get automatic updates, pricing and promotions sent directly to your tills to encourage those spontaneous purchases at the point of purchase.

By choosing an ePOS solution that has a dynamic and intuitive user interface, that integrates directly into your Sage Accounts, your staff will become more dynamic and flexible. They will be easily able to navigate through sales, up-sell and promotions and make your customers shopping trip a seamless and positive experience. Not only will your sales transactions be more efficient, but you as an organisation also get complete transparency over your stock levels, promotional uptakes, fast-selling products and more importantly non-selling products to help you improve your customer experience and profitability even further.

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There are many benefits that come with having an integrated ePOS system. If you would like to know more about how our ePOS solution works, give us a call to see how it could make a difference to your business.

Breaking down Inventory costs

Managing a warehouse is a complex and multi-levelled process. If you are currently managing a warehouse, you will already be familiar with the different costs involved and how ordering and selling inventory go way beyond the purchase price of each item, and that these additional costs need to be managed to ensure that your business remains profitable.

There are many aspects that need to be managed when it comes to inventory processing, and being able to identify and quantify each of these aspects are cost-saving opportunities. However, difficulties can arise when you are unable to differentiate between them or even worse, be unable to identify them in the first place.

There are many different types of costs associated with inventory management, but for today, we are going to explore the three major ones.

Inventory Costs – What are they?

 

Carrying Costs

Warehouse inventory involves capital that you may not even realise has a direct link or association with your stock. You need to consider where your stock will be stored, the utilities involved for your premises e.g. lighting, heating, air conditioning, as well as insurance and staffing. Typically, the greater the amount of inventory the greater the carrying costs and these costs can slowly erode the value of your inventory if the carrying costs have not been identified.

There are also other costs that are associated with carrying inventory. If you are managing a warehouse, you generally have a good idea of what your stock movements, are and which items of stock are fast-selling and which usually hang around in stock for longer. However, holding stock over a long period increases the risk of inventory shrinkage and obsolescence.

Inventory shrinkage simply means your total item stock count has shrunk over time and this can occur for several reasons such as damage, misplacing of goods, stolen items and waste. Obsolescence is when your stock becomes outdated or no longer of use; this particularly important for perishable good and expiry dated items.

By integrating our PSS software with your existing Sage Accounts, our advanced functionality can help you to avoid these issues by easily keeping up to date with stock rotation. For items that are not limited by expiry dates, you may face other issues such as seasonal or fashion trends, where the cost of your inventory is tied up and cannot be reinvested elsewhere.

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‘Sold-out’ Costs

There are many ways to try and reduce the costs of carrying inventory and many warehouses utilise the just-in-time stock approach. Though this method can be successful in reducing costs, there are many risks associated with this. The just-in-time approach does not account for the spike in sales such as seasonal trends and more often than not can leave you with out of stock items.

Out of stock items can have major implications on your business, leaving you with empty shelves or warehouse space, as well as reducing customer confidence and satisfaction. However, by integrating inventory management solutions such as PSS 50 or PSS 200 to your Sage Accounts you could prevent these issues. From order processing through to receiving goods, dispatching and stock taking, our Sage inventory solution makes your process efficient, accurate and eliminates human errors.

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Ordering Costs

In addition to the purchase cost of inventory, there are other costs to consider such as the procurement of the inventory, for example, the delivery, the labour of transporting and transferring stock, as well as the overall management of the stock process and the downtime costs for manual stock takes. By not having the right systems, these processes can be left open to human error. The question is, how much control do you really have over your stock inventory processes? Our Sage integrated inventory management solution can help you take back control.

 

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Reducing Inventory Costs – What are the best practices?

Having an insight into your warehouse is vital but knowing how to manage it and how to assess the hidden costs is even more important. Real-time data can help ensure that your procurement is linked to demand, order processing, and is tailored to your customer needs.

Greater automation can help reduce staffing costs and human errors and give you real-time oversight of your inventory levels.

 

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Get in touch today to find out how we can help you maximise this powerful inventory management solution.

Inventory Management Trends 2019

Inventory Management is an ever-changing and adapting industry. In today’s agile environment it can be hard to manage the changes in customer demands as well as keeping on top of industry news and trends. There are many recent trends that you may have already heard about and it’s definitely a good idea to keep an eye on them as they develop. Let’s look into a few of the inventory management trends that could help transform your warehousing and logistics operations.

Advanced sales forecasting

There are many reasons as to why customers are unlikely to use your services again. This doesn’t solely come down to your products or customer services, its one step back from that. It’s the availability of your inventory. Have you ever considered, at what point long delivery times or the sold-out stock becomes a deal-breaker for you and your organisation? With the rise in online giants such as Amazon, offering next day delivery, customers are increasingly becoming more demanding for immediate availability of stock and will not tolerate waiting for items that are currently out of stock.

Advanced sales forecasting ensures that you have the right products on your shelves or in your warehouse when your customers need them and reduces the risk of having out of stock items. This means higher customer satisfaction levels and in turn, means higher sales numbers. However, the advanced sales forecasting can become almost impossible if you do not have an accurate demand forecast to work from. By integrating PSS 50 or PSS 200 into your Sage Accounts you can know your stock levels and trends at any given time to assist you with advance sales forecasting.

 

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Digital twin technology

A digital twin is a trend that is becoming increasingly more popular. A digital twin is a technology that replicates a product, process or service in a digital format. It is a bridge between the digital world and physical reality, using sophisticated technologies to gather data such as working conditions, real-time status or position. We have already explored the importance of how Sage stock control can help to shape your warehousing data, but how can digital twin technology help to improve your inventory management even further?

Let’s take the example of your car for a moment. If you have a modern car, chances are you have a real-life example of digital twin technology right before your eyes. In the past, you would know if there was a problem with your car if your car broke down. However, in today’s world, we are well aware of an issue with our cars from warning lights, errors and signals. These messages provide indicators to what is wrong with your vehicle or inform you that action needs to be taken, sometimes even before an issue has even occurred. Pretty handy right? So, imagine the same process but in relation to your warehouse. Digital twin technology can provide a glimpse of your existing and predicted inventory, as well as show you where to locate your stock. This can reduce the cost of stockouts, delivery and manual labour. For successful inventory management, pair this concept with our PSS software and you will be able to optimise your stock levels and reduce lead times as you will already be aware of low stock levels, and inventory movements before any issues occur.

 

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User Interfaces

Warehouse Managers seldom have time to wade through reams of data to find the answers they are looking for. Therefore it is important to have an inventory management system with a simple and intuitive user interface that presents data in a logical format. By using an inventory management solution such as PSS 50 or PSS 200, warehouse managers and employees can focus on the job in hand, as the simple and engaging interface, that involves little training, presents the data that you need at the touch of a button.

An inventory management solution with a well thought through user-interface can also have additional benefits to your business, such as reducing the cost of training new employees. For example, many warehouses have seasonal peaks, where temporary workers need to be brought in to help cover the spike in activity. With our PSS solution, there will no longer be a need for long training sessions and you can have your temporary staff up and running in next to no time.

 

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Expanded functionality

In order to manage their warehouse more effectively, Warehouse Managers are increasingly looking for inventory management solutions that do more than just record stock movements and inventory levels.

For example, if you stock products that are perishable and you need to track expiry dates for stock rotations, or if your items have serial numbers that you need to track for product warranties or rebates.

Choosing an inventory management solution that reduces administration time and tracks expiry date or serial numbers just by scanning a barcode, can help to improve your warehouse efficiency and give your warehouse managers more time to develop new procedures, manage the warehouse better, and enable you to provide an even better service to your customers.

 

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Are you ready for more information?

If you are, then feel free to get in touch. We have a lovely team on hand who have more details for you. Let us help you find the best ways to manage your inventory and use data to improve your business.

How Sage stock control shapes your data

Companies, especially in the logistics and warehousing industries, are flooded with data. The question is, what is the best way to handle and use this data to improve your business? With Sage stock control, you are provided with a software solution that analyses your data for you in one centralised hub.

Data can hold many different meanings for different organisations, as all businesses depend on it for different reasons. Data can be both structured and unstructured and can be processed and analysed manually, but when the volumes become too large to be processed using traditional database and manual techniques, Sage stock control is the perfect solution for you.

If you work in the warehousing industry, you may be accustomed to various volumes and different paces of data movement that exceeds manual processing. In some scenarios, the volume and movement of data may even be exceeding the capacity and limits of your existing software and applications. If you are in this position, you may be experiencing signs that you need a new stock control system.

Unfortunately, the real importance of handling data and data analysis within organisations, which can be crucial for business success, is often overlooked and under-appreciated. However, identifying that data plays a vital role in improving operations, increasing profitability and making faster and more efficient business choices is one thing, learning how to do it is another.

With a Sage stock control solution, you don’t have to worry about interpreting and digesting high data volumes, it is a complete solution that does it for you. We’re going to delve a little deeper into the main components that influence data analysis and how Sage stock control maximises these to drive efficiency of your warehouse management.

Data is heavily influenced by volume, velocity, variety and veracity.

Volume:

This specifically refers to the size of data that your warehouse is capturing. With Sage stock control, you don’t have to worry about how much data you need to manage. By simply integrating PSS into your existing Sage software, you can process various volumes simultaneously and eliminate the need for manual data processing. Additionally, PSS enables you to get critical business information almost instantly at the click of a button.

Velocity:

This refers to the speed in which data changes. This kind of data analysis should be at the top of any warehouse management practices due to stock continuously coming in and going out. By utilising a software solution like Sage stock control, you will never have to worry about ‘keeping on top of your stock management again’. This complete solution updates your systems in real time each time stock is ordered, despatched and delivered.

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Variations:

If you are a warehouse or organisation that holds various forms of stock, then naturally the variety of data sources associated with each item of stock will vary too. That doesn’t sound too complicated until you have to continuously monitor, track and store each item. Now imagine trying to do that manually or with a limited software solution that in essence is causing more issues than it is adding value. PSS can help you to manage batch serial numbers, expiry dates and multiple bin and warehouse locations from multiple sources, simply and efficiently.

Veracity/Pinpoint Accuracy:

The uncertainty of data accuracy can single-handedly be the failure of any warehouse or logistics company. The real value of true data accuracy is the ability to analyse trends in real-time and extract critical data you need for management and operational purposes.

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How does gaining control over these influential aspects benefit your organisation?

By having greater control of your data volume, velocity, variety and veracity, you can improve your operational efficiency and performance as well as maximising conversions and profits. Sage stock control allows you to gain a clear insight into your inventory transactions as well as having access to metrics to help measure and analyse your data. Analysing real-time data not only helps you to manage cash flow but also helps to identify stock movement trends such as seasonal peaks and troughs to help improve your stock management.

The most important factor for any warehousing or retail business is for you to implement a stock management solution that you can control. With the technology continually advancing, it would be easy to implement an overcomplicated solution that is challenging to control. With Sage stock control, the power is in your hands. With seamless integration into your existing Sage accounts, the biggest question you will ask yourself is why you didn’t implement a Sage stock control solution earlier.