Business Sponsored

3 Myths About Inventory Optimization

Image courtesy of Pexels

The digital revolution in business has come for the warehouse. After decades of being relatively left behind, new and innovative business strategies are being used on a regular basis to revolutionize the ways in which companies store and process their inventory. Many companies are leaning towards the newest warehousing approaches. They are trying warehouse and inventory ideas that involve big data, algorithms, and a general weariness towards holding a large amount of inventory on hand. These approaches had led to the propagation of a number of myths about how warehouses can most effectively operate. Quashing these myths is essential for companies to effectively handle their operations in this stressful time.

Warehouses are unnecessary

The hottest trend in the world of inventory optimization software is the reduction of warehouse space completely. Several new approaches to inventory management have hinted at this obsolescence of the warehouse. Just-in-time inventory is an exciting new field of inventory optimization software that has been embraced in recent years. The idea behind this approach is to make sure to keep the manufacturing and distribution process as closely connected as possible. Products should be manufactured, stored for only a few days, and shipped out to the consumer. This approach requires a complete reliance on technology and a close connection with regular customers. In many cases, just-in-time inventory management involves significantly downsizing warehouses to cut costs over a long period of time.

Made-to-order manufacturing processes emphasize this point even further. They reduce the already depleted warehouse approach of just-in-time manufacturing. With this approach, many individuals and companies do not even have warehouse space. They produce materials, package them, and then put them on a truck and send them out to the buyer.

Computers can do it all

Companies are increasingly trying to remove the human element from inventory optimization and warehouse management. They view human beings as prone to mistakes and poor work performance. Removing the human element removes a source of experience and flexibility that computers simply cannot provide at this point. Human beings have seen what can go wrong with inventory optimization. They have experienced a number of order failures and poor planning when it comes to implementing orders. People know how they can make severe mistakes and what to do in order to avoid those mistakes. Companies always need to invest in human beings at every level of their business.

No extra position is needed

The rise of digital operations has led to a decrease in the hiring of specialized positions. Many companies are now assuming that one person with a computer can do a wide variety of jobs. There are new suites of software that attempt to replace everything that an employee was previously doing. They may even be guided by AI which seems to learn on the job and respond like a human employee. Companies have been acting as though this is the way that they are updating different positions. They have been replacing individuals with technology in a wide variety of sectors.

This approach is misguided. Individuals in a company need special tasks to perform. If they are brought in to do a particular job, they need to be given the space and latitude required to do that job correctly. By giving a person one job, that person can do a significant amount of research and talk to experts in the field who can help them perform their job at the highest level. If they are given multiple jobs, there is a considerable chance that one of these jobs will fall by the wayside.

One particular job may be more difficult than the others or maybe mostly ignored by management. As a result, it will not be done as effectively as the company wants it to be. Inventory optimization is the same as any other approach. There is a relatively high chance that inventory optimization will be ignored in many companies. This field is still relatively new and can be ignored by companies that have already invested significantly in warehouse technology. If a person has been given the task of optimizing profits and inventory, they will always focus more on the profits than the inventory.


Any company that is looking to significantly change its inventory approach needs to avoid the myths listed above. They need to look at some of the fundamentals of inventory management and embrace experts who know what they are doing and can share their knowledge with the rest of the company. Most importantly, they need to find ways to marry technology and experience in the crafting of their inventory approach. Focusing on one concept over the other is likely to end in failure for the company and a number of problems with orders. Minimizing failure is essential to having a competent, respected approach to inventory optimization

About the author


Sumeet Manhas

Sumeet is professional writer who loves to research of unique topics and express his thoughts by content writing.