Supply chain professionals from diverse industries shared their current inventory management efforts, challenges, and future plans in our newly released annual Digital Inventory Report.
For complete details, download the full report. You can also read on for a snapshot of the data and insights gathered and presented in the report.
The information contained within the report comes from the experiences of those professionals tackling today’s most challenging and troubling inventory management issues. You can probably relate to many of them. While the report does not aim to solve problems, it shares how companies are adapting and what they are doing to stay competitive in a difficult business landscape.
Why Inventory Management Should Be Digital and Automated
Digital means leaving paper and its isolated data and the inherent inefficiencies of manual processing. Digital technologies like mobile barcoding increase speed, transparency, and timeliness. In fact, mobile technologies are a leading factor helping companies realize those benefits and more.
Our survey reported that 83% of respondents currently use barcode scanning as part of their inventory management. Companies that want to stay competitive need to deploy digital processes as it relates to their inventory management, especially in a world of uncertain supply chains.
Barcode scanning is only one type of digital inventory management tool available. Of those surveyed, 58% stated an intent to invest even more in projects focused on implementing better inventory control.
Let’s take a closer look at the current state of inventory management and where it’s going, based on the input of those who are shaping the field today.
Who We Surveyed
Participants came from different departments in companies of diverse sizes, across a variety of industries.
- Company profiles were evenly split. About 1/3 of the companies had revenues between $200M and $1B; 1/3 reported revenues less than $200M and slightly less than 1/3 had revenues over $1B.
- Respondents came from IT, operations and logistics, and finance departments with IT making up nearly half.
- Not surprisingly, manufacturing and distribution made up more than half of the industries represented, though others included life sciences and wellness, aerospace and defense, and food and beverage.
Survey Results: The State of Inventory Management
Priorities varied from one company to another. Nearly everyone (89%) agreed that data security is extremely important to inventory operations. Technology integration and connecting multiple applications is a focus for nearly half of all respondents. Cloud migration remains mostly split, with nearly half having no plans to move to the cloud while 31% are already operating in the cloud and another 20% are actively planning their move.
What Automation Technologies Are They Using?
Barcode scanning represents the most common solution used at 83% of those surveyed. 58% are using mobile devices to capture data. Interestingly enough, nearly half of the companies are also using a warehouse management system (WMS). A WMS offers next-level inventory automation and complexity but at significantly greater cost, which may not be a fit for every organization. However, a WMS “lite” solution can provide core WMS functionality at a fraction of the resources.
Inbound warehouse and production and manufacturing comprise the primary areas of focus for most companies. 78% currently use mobile automation in their businesses. Of those using mobile automation, 26% have gone fully mobile while the remaining 52% are partially mobile, using it in select areas of their operations. This is clearly a growth opportunity for companies who aim to gain a competitive advantage in their markets.
The data shows more than 75% of companies recognize the importance of mobile automation, although more than half have only achieved partial automation. Technology integration, getting the different systems to work together, may be a factor here along with, of course, budgets. Even so, it’s evident mobile automation is the way of the future for inventory management, especially as companies address today’s pressing challenges.
Prioritizing Inventory Management Challenges
Although surveyed independent of each other, inventory management professionals all agreed on the biggest challenge: too many challenges.
The wide range of challenges facing businesses has, unfortunately, created an additional challenge – prioritizing where to focus first.
- Over/understocking is a serious issue that impacts revenue and the customer experience.
- Inaccurate inventory data disrupts decision-making.
- Incorrect picking and shipping negatively impact revenue and customer service problems.
Of course, there are many more problems. Some of the most acute challenges facing companies include: 1) a lack of trained staff, 2) organizational complications, and 3) inadequate ROI and budget calculations.
In the Digital Inventory Report, respondents painted a picture of an industry facing intense pressure to meet both customer demand and business needs. For example, one of the greatest overall challenges faced is surging customer demand (67%) which began during the pandemic and continues.
You can download the report to review the full range of obstacles and which ones are most predominant and pressing. Perhaps more importantly, you can see how fellow inventory managers are responding.
What Survey Respondents See for the Future of Inventory Management
The critical challenges have driven and inspired, or perhaps forced, new approaches and ways of thinking about inventory management. For example, 62% of our respondents have integrated some degree of mobility into their day-to-day operations. Of those using mobile technology, 59% plan to expand the use of mobile devices and related software applications like digital inventory systems.
Managed services for inventory technology is another area of interest. The managed services approach delivers software, hosting, and maintenance through a scalable monthly cost in a software-as-a-service (SaaS) model. This provides advanced enterprise-level mobile technologies without the need for technical expertise or internal resources to manage them.
Mobility, robotics, and cloud software are only a few of the other technologies companies are investigating as a way to adapt. In fact, more than half of the companies surveyed plan to invest substantially in new supply chain technologies, regardless of business size.
For complete details and to see how businesses are planning to adopt digital technologies to stay competitive and meet customer needs, download the full report today.