Accurate and reliable data are essential to any profitable business operation. Among all the aspects of business operations, inventory represents a significant portion of assets. Data associated with Inventory Management is indispensable for companies as it helps in predicting future costs and possible growth avenues. Every year companies spend trillions of dollars for efficient and effective Inventory Management. In order to achieve that every company must keep track of its physical inventory to update stock orders which requires the periodic stock count of its warehouses. This process involves a team of individuals roaming the warehouse manually checking for inventory. To understand the significance of this activity we can take a cue from the fact that some companies even stop operations to carry out a full physical inventory check.
Even with all the efforts and after utilisation of available resources, inventory accuracy is never guaranteed. The main reason for the low accuracy can be attributed to the manual labour involved in the process.
The personnel involved have to go to each and every good in the factory to update the inventory database.
On the other hand, managers need to accurately and timely know the inventory status and where it is located in order to make effective operational and financial decisions.
Companies that carry a significant amount of inventory are continually looking for better ways to improve the overall efficiency of their inventory checking process.
INVENTORY MANAGEMENT — CURRENT CHALLENGES
“In 2016, the U.S. National Retail Federation reported that shrinkage averaged around $45.2 billion annually”.
“In 2013 Walmart lost $3 billion in revenue because of mismatches between its inventory records and its stock”
The above scenarios are real-life examples of failures in inventory management. These are MNCs and big government agencies who were not able to track their inventory accurately and ended up losing big. However, we cannot blame them entirely for the loses as the technology enabling inventory management is constrained by various factors.
Currently, to take inventory, employees have to aim a reader at each RFID tag to read and record the stored information. Even with RFID tech, taking inventory is still labour-intensive requiring humans to walk the long aisles of massive warehouses and stores. It can take a single large retail store for three months to perform a complete inventory review. Although RFID tags were intended to revolutionize supply chain management, these tags have often proved unreliable as they are not error-free. The overall magnitude of the task of taking inventory in all warehouses and stores in the world is simply gigantic. The cost of labour involved in the process, the time to take inventory, errors, and the cost and difficulty of correcting those errors are some of the major concerns of a company.
If that was not enough rental of elevated work platforms required for manual checks, risks for participating personnel, interruption of logistics activity/normal operation adds to the woes of the company. Also with manual inventory tracking, mismatches often go undiscovered until exposed by a customer complaint which can stain the public image of the company.
AI FOR INVENTORY MANAGEMENT
AI has the power to eliminate the need for manual inventory checks, allowing businesses to allocate resources and manpower elsewhere thereby increasing the possibility of better-operating profits. It can facilitate managers with an accurate real-time view of product levels which can help them in scheduling the future stock orders.
Companies can leverage the power of AI to automate purchase orders while ensuring that inventory levels are always optimized. When inventory drops below a certain standard, AI technology can repurchase orders without any need for manual intervention, increasing operational efficiency. With AI, businesses will be able to order the right amount of products at the best possible price, ensuring that no money is wasted on inaccurate or extraneous orders. Through automation, AI significantly removes the chances of human errors.
Industry today should embrace AI to obtain much-needed agility to create a significant impact on the way businesses operate.
AI POWERED DRONES — OUR SOLUTION
ParallelDots gives you an AI-powered standalone drone that will fly around your warehouse, capturing products information from shelves while simultaneously updating the WMS database. The drone logs information into the database which can be analyzed for future stock orders and to avoid shrinkage. This will simplify year-round identification and correction of stock-taking errors.
All of this done in real time with minimal human intervention. It promises to overcome the impediments of the manual system. Drones provide a safer alternative to traditional, labour-intensive methods involving reach trucks, forklifts, man-cages and scissor-lifts. It can be easily deployed, without requiring any adaptation of the warehouse infrastructure.
Some of the main features and benefits are listed below,
- Autonomous Solution
- Reads each label five times more quickly than when inventory checks are carried out using RFIDs
- Accepts all barcode formats
- Integrates with all WMS and ERP software
- Reduces risks and difficulties associated with inventories
- Increases productivity by improving inventory level accuracy
- No more rolling stock counting
- Savings in personnel costs or operations downtime
- Staff can be redirected to handle other high-value activities.
Want to reduce the workload related to inventory management? Click here to schedule a free demo.