What is inventory management? 

Inventory management includes all processes involved in tracking, controlling and managing stock. Put simply, it's managing the flow of a product from the manufacturer, to the supplier, to the end user. Tracking such data assists businesses with customer demand & service, resource and financial management.

What is warehouse management? 

Inventory and warehouse management are sometimes used interchangeably when discussing managing, ordering and moving stock within a business. While they both work in conjunction to monitor product levels, track products and more, they are two different functions of business management. 

Warehouse management includes the various processes involved with maintaining a business' warehouse, including controlling the storage of products and their movement within the warehouse. 

A warehouse management system (WMS) are the processes, usually in the form of a platform or software, that allow a business to control operations throughout every stage until the goods are moved out of a warehouse. This management system aims to optimise warehouse functionality including organising products, managing staff, controlling available resources, picking and packing orders and auditing productivity and processes.

The importance of warehouse and inventory management 

Inventory and warehouse management strategies play an important role in improving business operations, reducing costs and importantly, satisfying consumers.

Effective warehouse and inventory management can: 

1. Collect accurate data 

Accessing data from inventory management software provides insight into accurate and real-time sales data, allowing a business to better understand their customer groups, identify supply and demand changes and more. 

2. Assist marketing efforts 

Inventory management also lends itself to marketing purposes, where an understanding of what items customer groups and individuals are purchasing, as well as the likeliness of demand, can help tailor marketing and advertising efforts.

3. Improve customer service 

These management functions are also crucial to uphold a high level of customer service. The ability to track production of products, quantities and when an item is out of stock greatly improves the customer's experience when purchasing. Customer experience is increasingly important to build brand trust & loyalty, especially if your business is offering identical or similar products to your competition.

4. Enhance financial management 

An automated inventory management system can store accurate data to improve overall financial management, including gaining an understanding for the costs to ship an item, how much new stock will cost, when it will be needed and the resources required to perform these activities.

Standards helping inventory and warehouse management 

Standards can help a business fine-tune their inventory and warehouse strategies. For example, ASTM E 2132:2017 addresses inventory verification which includes either physically or electronically confirming the existence, location and quantity of assets.  

There are also Standards that help define effective inventory management within specific industries, including CLSI QMS21 1ED:2016 which determines purchasing and inventory management processes to ensure the appropriate equipment needed for laboratory services, such as instruments, consumable materials and more are available. 

To implement a warehouse management system, VDI 3601:2015 defines the task and performance areas that define an IT system as a WMS and VDI 3629:2005 refers to the basic organisational functions in warehouses including block warehouses, rack warehouses and high-bay warehouses. 

Standards can also help create a productive warehouse, for example, the set of ISO 8611 Standards defines best practices for pallets for materials handling - including performance requirements within Part 2 and maximum working loads in Part 3. 

When Standards are used to streamline processes, a business can benefit from increasing operational & financial efficiencies, customer confidence and brand affinity.

Prioritising inventory and warehouse management 

Taking the time to establish efficient and effective inventory and warehouse management strategies can greatly benefit your business. From creating a seamless customer journey, to assisting with financial management and even improving marketing efforts, both are core management strategies any business should invest time and resources in to.