Inventory management is all about loading, unloading and managing inventory in the warehouse. It seems so simple but it is not. Managing inventory requires a tremendous amount of time, effort and people. The problems surrounding managing inventory in the warehouse includes spoilage (if it is food), dead stock, storage cost, stock-outs, employee errors etc. The existing systems that keeps track of inventories are mostly outdated. This keeps people working in the warehouses at check.
Much effort and time is required to assemble data about the products which are often times misplaced and unable to find. The more organised a warehouse is, the easier it is to track and ship them. But, this is close to impossible with the current technologies and a better technology is mandatory to solve these problems.
Hopefully, there’s a technology which help us eliminate the above mentioned problems and simplify the process of managing inventories. It is Blockchain. Its use case goes beyond finance and is suitable for inventory management. Any transaction recorded in the Blockchain is immutable (not erasable) and there’s no chance of fraud. The decentralised record keeping system makes everything in the network transparent so that the parties involved in inventory management can work with integrity.
Here is the list of problems faced in the current inventory management system and the solutions with Blockchain.
Problems in inventory management:
– The high cost of inventory
– Stock Outs
– A high amount of working capital
– Shipping wrong inventory items
– A high amount of obsolete inventory
– Employee errors
– Lack of optimization
Solutions with Blockchain:
– Real-time inventory management
– Accurate forecasting
– Keeps track of production and sale
– Better risk management
– Competitive edge
– Business Effectiveness
Managing inventories, especially in a large warehouse, one cannot generate more revenue always, but the room for reducing cost is available. With Blockchain in place, there’ll be complete transparency in the network which develop trust among the involved parties and help users track the exact path of an item including from its origin.
By seeing everything in real-time, it is much easier for the employees to manage excess inventory, clearing stocks, managing stock outs and help reduce employee errors. The inaccuracies can be easily calculated which helps in reducing the cost and maximising the revenue, which is what a potential business always strive to achieve. Lower costs also serve as a competitive advantage, so your business will always be more efficient than the competitors.
Also, by keeping track of the sale cycles and production on a daily basis which is always easier on the Blockchain, businesses can benefit by looking on it and plan necessary changes and implementations.
A Solution to the Real World Problem
Chipotle, american chain of restaurants, has been facing problems with inaccurate management of inventory and stock. As a result, people got sick after eating contaminated food served in Ohio earlier this year. The centre for disease control and prevention has confirmed that it is because of a bacteria, “Clostridium Perfringens”, which causes food-borne diseases. This occurred because the food was stored in an unsuitable temperature.
“A report says that this is Chipotle’s seventh outbreak in the span of last 3 years.”
Now, they’re training their employees to ensure daily checks to maintain food safety. This problem, however, can be solved by leveraging technologies to find contaminated food. Smart IoT devices deployed in the warehouse where the food items are stored, will monitor the temperature and will detect any food items which are contaminated and not safe for consumption. This data is then posted on the Blockchain for all the relevant parties to see. This way, we can eliminate the problem.
So, are you going to eliminate the problems in managing inventories and maximize efficiency? Then embrace Blockchain with us.
We develop Blockchain which solves real-world problems in inventory management ranging from small to large warehouses. We also expertise in the development of smart contracts, ICOs, Crypto Exchanges and more. Let’s talk!