What is an Inventory Management System?

July 27, 2020

Fleet managers are constantly looking for ways to optimize their fleets. Inventory management systems are powerful tools that can help fleets improve their efficiencies.

You may think “why do we need an inventory management system?” If you do not have a reliable and organized system to track thousands of parts from a myriad of different manufacturers, you inevitably will have assets that are unaccounted for that will cut into your profits.

When fleet management software is utilized to manage a fleet’s parts inventory, it’s service department will keep running efficiently through better organization, real-time visibility of parts on hand, and cost-saving opportunities.

What is an Inventory Management System?

An inventory management system (or inventory system) is the process by which you track your goods throughout your entire supply chain, from purchasing to production to end sales. It governs how you approach inventory management for your business. There are many different types of inventory management systems. It can optimize the entire spectrum spanning from order placement with your vendor to order delivery to your customer, mapping the complete journey of a product.

Inventory management systems use a combination of technology (hardware and software) and processes and procedures that oversee the monitoring and maintenance of stocked products, whether those products are company assets, raw materials, supplies, or finished products ready to be sent to vendors or end consumers. They streamline data entry while increasing record details for analytical reporting. They also can improve data entry time and assist in generating reports. It’s not just for large organizations, there are Inventory management systems for small businesses.

Some inventory management systems allow you to generate estimates for service work, convert it into work orders, and schedule work out on the shop calendar. The transparency provided by this software has a big impact on the bottom line of a business. Through accurate tracking of goods, businesses can minimize waste, analyze trends, and make better investment decisions.

Features You Need In Your Inventory Management System

Tools for Tracking and Scanning

Good inventory management services have a system for identifying every inventory item and its associated information, such as barcode labels or asset tags. They also have hardware tools for reading barcode labels, such as handheld barcode scanners or smartphones with barcode scanning apps.

Another option, aside from barcodes and scanning, is to use geofencing and asset trackers. Geofencing is one of the many useful ways fleets can utilize GPS devices installed in their fleet vehicles. With geofencing, you’ll receive alerts when something leaves the perimeter during unauthorized times. You can also receive real-time updates on assets no matter where they are.

Inventory Optimization

With inventory optimization, your fleet can maintain just the right amount of inventory for each product, without over- or under-stocking any item. It’s especially useful if you deal with products that experience a seasonal rise and fall in demand.

Stock Notifications

With stock notifications, you receive alerts and notifications when there’s over- or under-stocking beyond a defined threshold. This helps you to place orders or offer promotional discounts to clear out extra stock. The purpose of the inventory is not to sit on a shelf but to be sold.

Report Generation

Report generation lets you view sales history in the form of a list of your most popular products. This feature also enables you to manage items in your inventory that have not reached the sales levels you expected, for example, by offering discounts on them.

Multi-Location Management

Multi-location management lets fleets manage multiple warehouses and point-of-sale (POS). All locations can be integrated into a single inventory management system. Multi-location management combined with fleet route optimization can greatly improve the efficiency of your fleet.

Stock Returns Handling

Stock returns handling helps manage returns more effectively by reducing time-to-return through automation of the entire process.

Material Grouping

Material grouping helps fleets group inventory into predefined categories and ensure they’re always updated about quantities of components and specifications that make up their product stock, and manage their reordering schedules as required.

Purchase Order Records

Create a single view of purchase order records. You can easily identify which products are in demand, both perpetually and seasonally, and prepare to meet your customers’ needs.

Strategies for Improving Fleet Inventory Management

Decide on Physical Organizational Structure

Fleets should categorize manufacturers into sub-groups such as electrical, hydraulic, pneumatic, hardware, and more. They should also maintain an alpha-numeric order for all parts and clearly label bin locations. Fleets can also improve their inventory management system by securing inventory to reduce confusion regarding lost or misplaced items.

Develop Parts Entry Procedure

A great strategy for improving fleet inventory management is to develop a parts entry procedure. To do this, follow the recommended procedure by your fleet management system so that there is uniformity with all of your parts records.

Part number, description, manufacturer, unit of measure (UOM), part type, vendor, quantity on hand, and barcode information should always be entered to avoid confusion regarding details of a specific part. Consistency in a part entry is especially important for companies with multiple locations. For example, if “Part #102” in “Yard A” looks identical in your system as “Part #102” in “Yard B”, it can cause confusion and issues.

Having a 1-to-1 entry allows you to easily view and utilize inventory from all companies and all yards in real-time.

Determine Valid Reorder Points to Manage On-Hand Quantities and Reduce Costs

This is an especially useful strategy for improving fleet inventory management. Fleets should establish minimum and maximum barriers to the parts records of routinely used items to avoid overstocking or running out of something essential.

Track expenditures

You should develop usage information unique to your fleet’s specific needs to aid in reducing your service department’s operating costs.

Procedural Refinement

Fleets should facilitate and maintain a healthy dialogue between management and staff to determine what practices are working and what are not, as well as ways to improve organization. Be sure to evaluate costs by researching new vendors or inquiring about further discounts. Lastly, determine the true necessity of items and quantities being ordered.


There are many different ways fleets can be optimized. For access to cutting edge technology to help you do it, check out the products available on our website.

Explore fleet tracking blog posts by category.

Safety

Accountability

Efficiency

Reporting

Rewards

What is an Inventory Management System?

July 27, 2020

Fleet managers are constantly looking for ways to optimize their fleets. Inventory management systems are powerful tools that can help fleets improve their efficiencies.

You may think “why do we need an inventory management system?” If you do not have a reliable and organized system to track thousands of parts from a myriad of different manufacturers, you inevitably will have assets that are unaccounted for that will cut into your profits.

When fleet management software is utilized to manage a fleet’s parts inventory, it’s service department will keep running efficiently through better organization, real-time visibility of parts on hand, and cost-saving opportunities.

What is an Inventory Management System?

An inventory management system (or inventory system) is the process by which you track your goods throughout your entire supply chain, from purchasing to production to end sales. It governs how you approach inventory management for your business. There are many different types of inventory management systems. It can optimize the entire spectrum spanning from order placement with your vendor to order delivery to your customer, mapping the complete journey of a product.

Inventory management systems use a combination of technology (hardware and software) and processes and procedures that oversee the monitoring and maintenance of stocked products, whether those products are company assets, raw materials, supplies, or finished products ready to be sent to vendors or end consumers. They streamline data entry while increasing record details for analytical reporting. They also can improve data entry time and assist in generating reports. It’s not just for large organizations, there are Inventory management systems for small businesses.

Some inventory management systems allow you to generate estimates for service work, convert it into work orders, and schedule work out on the shop calendar. The transparency provided by this software has a big impact on the bottom line of a business. Through accurate tracking of goods, businesses can minimize waste, analyze trends, and make better investment decisions.

Features You Need In Your Inventory Management System

Tools for Tracking and Scanning

Good inventory management services have a system for identifying every inventory item and its associated information, such as barcode labels or asset tags. They also have hardware tools for reading barcode labels, such as handheld barcode scanners or smartphones with barcode scanning apps.

Another option, aside from barcodes and scanning, is to use geofencing and asset trackers. Geofencing is one of the many useful ways fleets can utilize GPS devices installed in their fleet vehicles. With geofencing, you’ll receive alerts when something leaves the perimeter during unauthorized times. You can also receive real-time updates on assets no matter where they are.

Inventory Optimization

With inventory optimization, your fleet can maintain just the right amount of inventory for each product, without over- or under-stocking any item. It’s especially useful if you deal with products that experience a seasonal rise and fall in demand.

Stock Notifications

With stock notifications, you receive alerts and notifications when there’s over- or under-stocking beyond a defined threshold. This helps you to place orders or offer promotional discounts to clear out extra stock. The purpose of the inventory is not to sit on a shelf but to be sold.

Report Generation

Report generation lets you view sales history in the form of a list of your most popular products. This feature also enables you to manage items in your inventory that have not reached the sales levels you expected, for example, by offering discounts on them.

Multi-Location Management

Multi-location management lets fleets manage multiple warehouses and point-of-sale (POS). All locations can be integrated into a single inventory management system. Multi-location management combined with fleet route optimization can greatly improve the efficiency of your fleet.

Stock Returns Handling

Stock returns handling helps manage returns more effectively by reducing time-to-return through automation of the entire process.

Material Grouping

Material grouping helps fleets group inventory into predefined categories and ensure they’re always updated about quantities of components and specifications that make up their product stock, and manage their reordering schedules as required.

Purchase Order Records

Create a single view of purchase order records. You can easily identify which products are in demand, both perpetually and seasonally, and prepare to meet your customers’ needs.

Strategies for Improving Fleet Inventory Management

Decide on Physical Organizational Structure

Fleets should categorize manufacturers into sub-groups such as electrical, hydraulic, pneumatic, hardware, and more. They should also maintain an alpha-numeric order for all parts and clearly label bin locations. Fleets can also improve their inventory management system by securing inventory to reduce confusion regarding lost or misplaced items.

Develop Parts Entry Procedure

A great strategy for improving fleet inventory management is to develop a parts entry procedure. To do this, follow the recommended procedure by your fleet management system so that there is uniformity with all of your parts records.

Part number, description, manufacturer, unit of measure (UOM), part type, vendor, quantity on hand, and barcode information should always be entered to avoid confusion regarding details of a specific part. Consistency in a part entry is especially important for companies with multiple locations. For example, if “Part #102” in “Yard A” looks identical in your system as “Part #102” in “Yard B”, it can cause confusion and issues.

Having a 1-to-1 entry allows you to easily view and utilize inventory from all companies and all yards in real-time.

Determine Valid Reorder Points to Manage On-Hand Quantities and Reduce Costs

This is an especially useful strategy for improving fleet inventory management. Fleets should establish minimum and maximum barriers to the parts records of routinely used items to avoid overstocking or running out of something essential.

Track expenditures

You should develop usage information unique to your fleet’s specific needs to aid in reducing your service department’s operating costs.

Procedural Refinement

Fleets should facilitate and maintain a healthy dialogue between management and staff to determine what practices are working and what are not, as well as ways to improve organization. Be sure to evaluate costs by researching new vendors or inquiring about further discounts. Lastly, determine the true necessity of items and quantities being ordered.


There are many different ways fleets can be optimized. For access to cutting edge technology to help you do it, check out the products available on our website.

Take a look at related posts.