Inventory visibility: what it means and why it matters

Every business needs inventory visibility. Find out why – and how a warehouse management system can help.



If you run a business selling goods, you don't need us to tell you the importance of inventory management. No inventory, no customers, no profits.

But how about the importance of inventory visibility? This is an area of inventory management that's sometimes misunderstood and often neglected.

Inventory visibility isn't just about what you can see on your warehouse shelves. It's also about your inventory records – whether these exist on spreadsheets or a warehouse management system (WMS) – and how this corresponds to what's on your shelves.

From one point of view, the argument for inventory visibility is easy to make. It helps you fulfil orders and give customers what they want. Simple, right?

It's a topic, however, that's more complex than it initially appears – and the benefits of which are perhaps wider-ranging than you might think.

What is inventory visibility?

Inventory visibility means more than just being able to physically see your inventory. In a business context, in fact, it's a phrase often used to refer to good inventory visibility – a view of your inventory that's accurate, detailed and up-to-date.

Inventory visibility tells you the inventory you have, its location and its status (on the shelves? On the way to the customer? Returning to sender?)

It gives you this information in detail. With a WMS, you can see immediately how many of each item is available, which have been ordered and shipped, expected delivery dates and stock levels.

This last point is invaluable for timely replenishment. You can immediately determine which items need restocking, helping you avoid costly stock-outs, returns and lost custom.

An example

Let's say you have 1,000 purses in your warehouse. Inventory visibility gives you a granular account of the order status and location of those purses.

Without inventory visibility, you might know that 500 purses are available. With inventory visibility, you know where they are, when more are arriving and which are being fulfilled.

And when you invest in a WMS, you get this inventory visibility in real time. When a customer buys a purse or a member of staff picks, packs or ships it, the change in status is immediately logged – and immediately accessible to the people who need to see it.

Why does inventory visibility matter?

Customer satisfaction depends on one thing: getting what you paid for. Without inventory visibility, that's surprisingly hard to achieve.

After all, you'll be hard-pressed to fulfil orders accurately and on time if you don't know:

• What inventory you have
• Where it is
• How much of it is available to sell
  
  

Inventory visibility lets you identify low stock before you run out, avoiding all the lost custom and customers that stock-outs entail.

Conversely, it helps avoid overstocking. You know, in detail, what you have in stock. So, there's no need to fritter money away on excess stock or oversized buffers. At the same time, you avoid the storage and insurance costs that excess stock creates.

Customers get the answers they want more quickly. This improves customer retention. After all, if you can't tell a customer whether an item is in stock, they're likely to look elsewhere.

Last but not least, inventory visibility is often closely related to reporting – especially when you use a modern, cloud-based WMS to monitor your inventory.

Rather than paying a third-party consultant, your WMS can generate actionable insights with just a few clicks.

At the end of the day, inventory visibility gives you detail. It's the difference between knowing you have something in stock and knowing that you have 37 items ready to ship, 10 arriving tomorrow and two on their way back to the warehouse.

That means you can stock the right products in the right place at the right time – and get them to the right customers on time.



How to improve inventory visibility

So, that's what inventory visibility is and why it matters. How can you make it better in your warehouse or warehouses?

 1. Have a single source of truth

Your first port of call is to have a single reliable record of inventory. This could be an enterprise resource planning (ERP) system, a WMS or an inventory management platform.

Whichever you choose, this record should act as a single source of truth for stock levels, locations, transit status, availability to sell and more.

2. Keep tabs on stock movement, not just stock levels

The next step is to ensure you're monitoring inventory whenever it moves. This gives you a clear picture of your inventory – whether it's received, put away, picked, packed, shipped or returned.

3. Harness the right technologies

One of the benefits of a WMS for inventory visibility is that it can be integrated with other technologies like barcode scanners, RFID tags and voice-picking systems. These all improve accuracy, reduce human error and contribute to overall inventory visibility.

4. Prioritise accuracy, too

Inventory accuracy is just as important as inventory visibility.

After all, software can only do so much. If your inventory is incorrectly counted, your inventory visibility is compromised. So too are the conclusions you draw from it about replenishment, product development and supplier relationships.

5. Integrate your systems

If your company deals with different systems – some combination of eCommerce sites, physical stores and warehouses, say – you should make sure to connect them so they can share inventory information.

6. Know what you're aiming for

Another way to improve inventory visibility is to define your key inventory metrics – clear and quantifiable measurements of success. These metrics could answer questions like:

• Does the inventory in our system match the inventory on our shelves?
  
• How often are there stock-outs?
• How quickly is inventory moving?
• How long is our current inventory expected to last?
  
  

These metrics can be tracked with a WMS – and, like the inventory itself, accessed and viewed immediately from any location and on any device.

How we can help

At Minster WMS, our CORE and EDGE warehouse management systems give you real-time visibility over stock levels, locations and availability. For you, that means useful insights that fuel better replenishment decisions.

Our procurement tools can flag critical and excess stock, use sales patterns to support demand forecasting and help you set purchasing rules for different products. That means you can respond more quickly to low stock without tying up unnecessary cash in oversized buffers.

Minster WMS can also raise and monitor purchase orders based on stock levels and forecast demand, helping turn inventory visibility into action rather than simply giving you more data to look at.

So, if you're looking for a cloud-based WMS that gives you a clearer view of your inventory – and helps you act on it – get in touch with our UK experts to book a free demo.