What you don’t know can cost you. For many B2B or B2C businesses, the focus on high-volume or warranty returns and the successful remarketing and sale of inventory is a time-consuming, challenging part of day-to-day business. But did you realize that a large portion of the hurdles you face are probably connected to how detailed and accurate your analytics and reporting systems are?
In fact, if your inventory reporting and analytics capabilities fall short, it can be exactly what fuels your inventory challenges. You are not alone in this struggle, according to a recent report from data-informed.com, which found that only 11% of supply chain companies have the capability to evaluate a potential “what-if” inventory situation, and only 24% of companies have the ability to analyze potential changes and industry trends and the impact they would have on profitability.
The best strategy requires that you become proactive rather than reactive so you can identify and reduce many time-consuming issues that occur in your supply chain, lower costs in managing your inventory effectively, and release yourself from the stress and time it takes to deal with unforeseen inventory chaos.
Plus, access to the right reports allows you to spend more of your time and energy on the important aspects of growing your business, rather than putting out fires.
In-depth Reporting and Analytics Can Save You Money
No company is immune to the myriad of challenges its supply chain can present, and sometimes a lack of information can cost your company a tremendous amount of revenue and resources.
Think this cannot happen to you? Think again. Even giants like Nike, the mega athletic footwear and apparel company, has experienced huge inventory issues, all owed to a lack of a good analytics and reporting system in place.
Back in 2000, without the correct, detailed reporting and inventory analysis to support adequate forecasting and planning, Nike experienced a devastating backlog in overdue deliveries of their popular Air Jordon sneakers.
This is an example where poor inventory control can virtually slash a company’s revenue. Nike lost approximately $100 million in sales, and the company’s reaction was to implement a new, highly detailed analytics and reporting system so history would not repeat itself.
How This Example Applies to Your Business
Your company is not Nike, and your inventory is probably vastly different, but this need for analysis and reporting spans all industries — including yours. Essentially, the information you receive about your inventory must be accurate and thorough in order for you to take appropriate action.
Detailed, easily accessible reports provide immediate answers to your questions about the status of your assets, eliminates uncertainty, supplies auditable results, and helps you instantly calculate ROI. In essence, it lays the foundation for further analysis of your entire operation.
You may think that simply knowing the description, location, and number of items in the warehouse is enough, but it is not. You should have much greater details available, like the ability to track work in progress for each item, whether the product is being tested as part of a warranty return, or is being remarketed on an e-commerce site.
If you are wasting resources trying to manage inventory without quality reporting, it is probably costing your company valuable time and revenue. A smart solution is to enlist a qualified 3PL provider, one that provides the very best in dynamic reports that fill in all gaps of information you currently struggle with.
What to Look For in Reports and Analytics
Not all reports are created equal. You need a customized solution, preferably one that simplifies selling across marketplaces by automating tedious, day-to-day tasks involved in inventory management, allowing you to operate more strategically.
- Seek a 3PL provider that offers reverse logistics software that manages the flow of product for you as it moves through the reverse supply chain, but with a focus on data metrics from the time a product is received until its final disposition.
- Your reports and tracking should tell you where inventory is at any time. Your 3PL provider’s system should allow you to log on through an online web portal and track your inventory in real time during all stages of process, no matter where it is in the supply chain.
- Look for a provider that can quickly and accurately provide status reports, which include: product received, tested, posted for sale, and awaiting shipment. They should have the ability to provide more in-depth technical reports for tested product, which include: quantity, condition, serial number, defect (if applicable), and included and/or missing accessories. Sales reports should be easily created so you can quickly see your return on investment. The best 3PL providers can also break down these reports by individual item, model number, and category or price point for analysis.
- Your service provider should adhere to Lean manufacturing principles. Adherence to Lean proves your provider has thoroughly vetted the value stream of all its processes from the perspective of the end user — you. In addition, an ISO 9001:2008 certification further validates that your provider upholds the highest standards of compliance in the business. Also, DoD 5220.22-M and NIAP EAL4+ mean your provider complies with the most effective data-wiping standards.
Reporting and analytics are of vital significance in today’s fast-paced B2B and B2C sales environments. Combining quality analysis of current and historical data, risk mapping, and scenario planning can support your risk management strategy and save your company time and money. Not only do your end-customers take for granted that they will be able to track their purchases online, you should also expect your third-party service provider to deliver quick, accurate, and accessible status reports on the progress of your inventory.
The quality of reporting is frequently what sets one 3PL provider apart from another. Top-of-the-line reporting and analytics hold the key to evaluating the effectiveness of your sales strategy and provide fool-proof evidence that you are in compliance with any environmental and government regulations. The more you learn about your assets as they move through the reverse logistics process, the better you will be able to leverage the information to your advantage.