SMEs (Small and Medium Enterprises) are the substantial pillar for economic growth and keep expanding their production to thrive in today’s competitive environment. However, with production increase, they face significant challenges with respect to inventory management and failure to deliver the services to their customers. Today, effective inventory management is of supreme importance for running a successful business and surviving the competition in the market. Having said that, the decision-makers in SMEs spend a lot of time on operations, but with the adoption of the best inventory & storage management tool in place to control the inventory, helps maximize on the best results. Here we tried exploring the challenges that SMEs face when it comes to inventory management and discuss some solutions that can help them overcome these difficulties.
Optimum use of space
One of the biggest challenges that SMEs face when it comes to inventory management is the optimum use of space. As businesses grow, they often outgrow their existing warehouse facilities and need to find a new, larger location. This can be a major challenge, especially for SMEs who may not have the resources to invest in new warehouse space. Additionally, the cost of rent and utilities for a larger warehouse can be a significant financial burden for small businesses.
Lack of flexibility and width of distribution.
Another challenge that SMEs face is the lack of flexibility in their warehousing operations. Many SMEs rely on a single warehouse location, which can limit their ability to respond quickly to changes in demand for their products. For example, if demand for a particular product suddenly spikes, an SME may not have the ability to quickly ramp up production and get the product to market in a timely manner.
Lack of automation
A third challenge that SMEs face is the lack of automation in their inventory management operations. Many SMEs still rely on manual processes for receiving, storing, and shipping goods, which can lead to inefficiencies and mistakes. This can be particularly problematic for SMEs who need to manage complex supply chains and meet tight delivery deadlines.
So what can SMEs do to overcome these challenges and improve their warehousing operations? Here are a few practical solutions:
1. Utilize third-party inventory management solution: For SMEs who are struggling with lack of space or the costs associated with owning a warehouse, utilizing a third-party inventory management solution provider can be a cost-effective solution. These solution providers like 20Cube Logistics can offer a range of services, including storage, order fulfillment, and shipping, which can help SMEs streamline their operations and focus on other aspects of their business.
2. Implement a multi-location warehousing strategy: For SMEs who need greater flexibility in their warehousing operations, implementing a multi-location warehousing strategy can be a solution. This strategy involves having a partner which has a global presence and can help SMEs respond more quickly to changes in demand ensuring enough capacity to meet the needs of their customers.
3. Automate operations: Another solution for SMEs looking to improve their inventory management operations is to implement automation. This can include the usage of management software incorporating digital logistics. MyHub+ by 20Cube Logistics is a great solution to digitalise processes, manage inventory levels, track shipments, and streamline order fulfillment processes. Automation can help SMEs save time and reduce the risk of errors, which can improve their overall operational efficiency.
4. Invest in technology: With increased competition, the SMEs unquestionably need to invest in technology to enhance their inventory operations. There are multiple inventory management tools available but need to look into those that can be customized based on their unique requirements and are affordable. For example, the most wanted inventory tools for inventory management systems are notification alerts, dashboards, reports, barcoding and mobile, and system integration that help having control over the inventory lying in the warehouse. In addition the use of technologies such as cloud computing, artificial intelligence, machine learning, internet of things, and data analytics are all used to better maintain inventory levels and offer real-time data with valuable insights into their operations and help make informed business decisions. The most advanced methodologies use predictive analysis to understand what inventory will be needed based on the past demand and other relatable factors.
In conclusion, inventory management can be a major challenge for SMEs, but with the right partner in place like MyHubPlus, can be a critical aspect of business success. Whether it’s utilizing third-party inventory management solutions, implementing a multi-location warehousing strategy, automating operations, or investing in technology, there are practical solutions that SMEs can use to improve their warehousing operations and achieve business goals with a hassle free experience in logistics and supply chain management.
Contributed by: G V S K Vedant, Sales, Hyderabad, 20Cube Logistics.