There is no such thing as a perfect inventory system, so mistakes will always happen. Sometimes the wrong item will be shipped to a customer or multiple items will be shipped to a customer. But, those mistakes will happen far less frequently if you’re using an automated management system. If you’re using a manual inventory management system human error can cause many mistakes, especially during busy times of the year like the holiday season. Incorrect orders can harm your brand’s identity, and it can also cost you a lot of money.
When orders are sent incorrectly you will need to send out the correct item. That means you are essentially doubling your cost on that item because you have to pay for the item itself and shipping on top of what you’ve already paid to send the incorrect item. Sometimes you can recoup some of that cost if the customer sends back the incorrect item and you are able to resell it.
But more often than not the customers will not send back the incorrect item, and you will end up eating the cost for that item as well as the shipping cost for it. If that happens once and awhile as a result of a random mistake that’s not really going to have a big impact on your bottom line. But, if you have a manual inventory management system and human error causes that to happen over and over again, those costs will really add up and could have a big impact on your bottom line, especially if you’re selling high dollar items.
How an Automated Inventory Management System Helps Eliminate the Cost of Lost Inventory From Incorrect Orders
Switching to an automated inventory management system will cut down on the amount of incorrect orders that go out because the system is designed with multiple redundancies to catch mistakes like an incorrect item being sent out or an item being sent to the wrong address. You will use less labor hours and have better accuracy with automated inventory management system.
The damage that incorrect orders have on your brand reputation can also end up costing you a lot of money. If your business develops a reputation for sending the wrong items or for sending items out very slowly, that will influence whether or not more customers choose to buy from you. Customers want to feel confident that you are taking their orders seriously and that they can count on getting the right item in a reasonable amount of time. If you can’t deliver on the promise of getting them their items on the first try customers won’t take a second chance on your business. And those customers could tell their friends and family to avoid your business as well and share their experience on social media. Bad reviews on social media or negative mentions can tank your brand identity with future customers.
There’s no way to prevent every mistake, however businesses that use an automated inventory management system have less product loss due to incorrect orders and manage to make their customers very happy by getting them the correct items on time.
Automated Inventory Management for SAP Business One and Macola Software
An automated inventory management system can help eliminate the cost of lost inventory due to incorrect orders. Contact us today to learn more about improving your order accuracy using an inventory management system.