Proper inventory management is crucial for steel producers. It prevents excessive holding costs, minimizes production bottlenecks, frees up cash flow, and ensures they always have in-demand products in stock.
If you’re relying on outdated software, it could be slowing you down and causing you to miss vital opportunities.
Consequences of Using Low-Quality Inventory Management Software
Steel production is incredibly complex and runs continuously, and holding raw materials can create a costly headache even for the biggest organizations. Proper inventory management ensures that stock isn’t held too long and workflows run smoothly. Without it, you may notice issues such as:
Reduced Cash Flow
Holding an excessive amount of raw materials ties up your capital and warehouse space. You need that money and space to focus on materials you can actually process, and products that will actually sell.
Effective inventory management ensures you’re only buying what you need, whether that’s raw materials you’ll use right now, or materials needed to cover an anticipated demand.
Degradation
Steel is not as immediately perishable as other raw materials, but it still rusts and warps, and if it’s held for long periods, it may experience chemical degradation. The result is that you pay for stock you never use, spend money holding it, and then eventually have to dispose of it.
Reduced Production
By failing to adequately track workflows, your software could cause operational bottlenecks or lead to a shortage of raw materials. Either way, production grinds to a halt, and you lose money for every second you’re not actively producing.
Unhappy Customers
Your customers expect the products they need to be available when they need them. If you don’t have the materials to produce what they require on demand, you could be forced to constantly shift your focus toward different grades or sizes, creating havoc on the production floor and disappointing your customers.
Benefits of Reliable Inventory Management Software
Inventory management software such as RealSTEEL™, developed in coordination with industry experts, tracks raw materials in real time. As soon as they enter your warehouse, the materials are recorded, along with their dimensions, grades, quality, and other key attributes.
It also integrates demand forecasting, which studies historical sales data to predict future trends and ensure you’re adequately prepared. The result is that you’re not loading up on raw materials in the hope that demand will increase; you’re anticipating it and preparing for it, saving you storage space and money in the process.
It also means you can secure prices early and guard against the rapidly fluctuating price of raw metals.
Inventory management software integrates into a broader ERP system that also incorporates customer relationship management features. You can upsell and cross-sell, but more importantly, you’ll have a direct line to your customers and their needs, allowing you to react quickly if they have an uptick in business. You’ll always be ready to meet their needs, but don’t need to assume the risk that comes with buying and holding excess raw materials.
RealSTEEL™: Inventory Management You Can Trust
Standard ERP systems simply don’t cut the mustard in steel manufacturing. They’re tailored toward the general, not the specific, so they often fall flat when dealing with the many challenges faced by steel producers.
RealSTEEL™ is different. We developed this software in coordination with industry experts and tailored it specifically to steel and metal producers. It is a complete software solution for your business, one that helps with everything from inventory management to financing, production, and more. To learn more about RealSTEEL™, contact us today. To see it in action, simply request a demo.
