The Right Stuff: Managing Inventory to Enable Agility for Manufacturing and Distribution Companies

Inventory is the lifeblood of any manufacturer, brand owner, or wholesale distributor. Managing inventory well is the key to success: driving sales, profitability, cash flow, and customer loyalty. When a manufacturing or distribution business is first getting started, it may be able to get away with minimal inventory management systems and processes. The owner can tell how much of an item they have by simply looking or asking a trusted employee, who remembers where they put everything and knows about how many are left.

However, at some point, it becomes too much to remember it all. Inventory may exist in multiple locations: at various suppliers’ sites, on inbound shipments, across various distribution centers, at channel partners’ sites, at customers’ sites, and in transit between all of these. At that point, the lack of systematic processes catches up, causing major problems. If there is extreme volatility in demand and supply on top of that, it can become an existential threat for the company. Putting the right inventory management systems and processes in place is essential for a company to survive in times of disruption and thrive in normal times.