Use NetSuite to improve your inventory management
Managing your inventory is a critical aspect of your overall supply chain. Poorly managed inventory processes can leave you in the dark when it comes to knowing how much stock is on your shelves, making accurate shipping estimates or planning for purchase orders. NetSuite inventory management helps you track your inventory, optimize safety stock, reduce costs and more. Below is an overview of how NetSuite can help.
What is NetSuite?
NetSuite is the world’s No. 1 true cloud enterprise resource planning (ERP) solution. Organizations of all sizes use NetSuite’s full suite of tools to manage their business. However, the solution is especially useful for distribution and manufacturing companies, with modules that effectively manage all aspects of the supply chain. Additionally, NetSuite includes built-in business intelligence tools to provide insight into your business’ performance in real time.
A little about inventory management
Part of the supply chain, inventory management is the process of ordering, storing and delivering assets. Those could be raw materials for future manufacture or finished goods ready to sell to a consumer. Optimal inventory management is about balance in order to minimize costs, increase customer satisfaction and maximize profit.
Inventory management tracks goods as they are purchased from suppliers, traces their status and location within the warehouse and their shipment to customers. However, there’s a lot that goes into tracking, storing and purchasing product. That’s where NetSuite as an inventory management system comes in.
Why NetSuite for inventory management?
You can run your entire business on NetSuite, but as a modern cloud-based solution, it’s especially adept at managing stock items regardless of their physical locations. NetSuite’s inventory management tools help you better understand when to reorder stock, plan for product demand, how much is on your warehouse shelves, where it is, how to find it and how to efficiently get it to your customers.
The top four features of NetSuite’s inventory management software include functionality for:
- Cycle counting
While overstocking can drive up your carrying costs, stockouts can lead to missed revenue and decreased customer satisfaction. NetSuite combats this by automating the process and determining preferred stocking levels, supplier lead times and reorder points. Suggestions are provided in the order items list, and rules can be set to take action once a threshold is met.
While NetSuite can help you automate the replenishment process to avoid stockouts, understanding those optimal stocking levels would be difficult without reliable and regular inventory counts. Inventory counting not only helps to prevent stockouts but also overstocking by facilitating better demand planning. NetSuite’s Inventory Count tool automatically prompts items to be counted and allows you to categorize inventory based on volume of transactions, its value, or both.
Additionally, you can reduce your overhead by minimizing the amount of safety stock you have to maintain. While these processes are automated, you can also enter periodic stock counts in order to ensure the amount of inventory you have is as accurate as possible.
Not only can you trace an item’s entire lifecycle within NetSuite, but you can also define products as being lot or serial tracked. All related information for each item is captured and identified, while you can view your inventory by lot or serial number on the detail screen. While there, you can drill down and see all related transactions.
These days, many companies have multiple warehouses in various physical locations. This is efficient for shipping and delivery purposes, but can sometimes create headaches when tracking and storing items. This isn’t an issue for NetSuite. Locations can be hierarchical, can have sub-locations and can be broken down into bins. With location and bin identified, any item can be stored in any location with a high-level view of your inventory across the board.
Benefits of NetSuite for inventory management
Using NetSuite inventory management tools to improve your business processes allows you to run your organization on one cloud platform. NetSuite is optimized for manufacturing and distribution, and includes modules for full supply chain management from start to finish.
Having one system to manage your entire operation comes with benefits, including:
- Real-time data visibility: Up-to-date data is viewable across your organization at all times, meaning your employees have an accurate picture of how your business is performing – no syncing necessary. You can also set up alerts to proactively notify you when inventory levels have dropped below a certain number, where a product is within the supply chain and more. The Supply Chain Control Tower feature allows you to proactively monitor your inventory, demand and supply across your global supply chain while still having the ability to drill down and filter results.
- Reporting: NetSuite comes with both pre-built reports and the ability to customize your own. Criteria such as time period, specific accounts, transaction fields and more can be applied to tailor your results. Information supplied is in real time.
- Cost reduction opportunities: Aside from improved warehousing processes and product tracking, NetSuite can help you identify costs related to supplier pricing, variances, shipping logistics, processing and more.
- Service improvements: Order management tools include the ability to set up rules that optimize delivery plans for product shipments and reduce lead times.
Planning a NetSuite implementation
While NetSuite implementations are usually considered more straightforward than other ERP projects, creating a detailed plan is still critical. We recommend planning around these areas for the best chance at success with your project:
- Project planning: Use a methodology. Terillium follows a five-step methodology of initiate, analyze, configure, deploy and optimize.
- Change management: Ensure you have buy-in from your team before proceeding with the project.
- Data conversions: Understand your data and prioritize time before the implementation begins to clean up, organize or fix errors.
- Testing: Don’t go live without making sure all functions operate properly, major business processes work and using testing as a tool for user training.
- Training: We at Terillium have a best practice that contends a comprehensive model of training all end users personally instead of department heads only ensures all users are trained properly.
- Support: Even the most successful implementation won’t preclude you from issues arising later. Have a support plan for after go-live by knowing who to contact and how and communicating the strategy to your team.
NetSuite inventory management demo
An important factor in choosing an inventory management system is considering the price. NetSuite pricing is determined by the cost of the software plus implementation costs. Software costs are based on three factors:
- User licenses – how many people in your organization will need access to NetSuite
- Base software – core functionality necessary to run your business in NetSuite
- Additional modules – any tools not included as part of the base software
A user license price is a flat rate per license. You can add licenses later if you need them.
While every edition of NetSuite includes the inventory management module, related tools like the warehouse management system module are common add-ons. Since NetSuite is a true cloud solution, no infrastructure is needed to run your solution, therefore eliminating equipment costs.
Choosing a NetSuite partner
Once you’ve chosen NetSuite as your inventory management system, next is another important decision: selecting a NetSuite partner. Similar to choosing a software solution that fits your business, your partner should as well. A good partner should fit not only your technical needs, but also your business objectives and company culture.
NetSuite partners offer a variety of services, such as licensing and implementation, training, establishing new subsidiaries or locations of your business, adding functionality and more.
You can’t engage a partner too early, but you can wait too long. Starting your work with a partner at the beginning of the process provides you with a source of knowledge in order to build a strong roadmap for your project. Additionally, choose a NetSuite partner with the right qualifications and a toolbox for success. A good NetSuite partner should have:
- Relevant experience in your industry
- Staff certified consultants and with substantial technical and functional experience
- Trusted advice and expertise
- Effective team communication and project management
- A proven methodology
- The ability to establish measurable milestones and goals
- Leadership skills to navigate your project
- Ability to prepare, plan and execute your project
- Be able to build your internal team
- Expertise to train your team and provide support
Terillium as a NetSuite inventory management partner
Terillium is an ERP consulting firm with more than 25 years of experience in the industry. We are an official Oracle NetSuite Partner and Solutions Provider for implementations, system assessments, special projects, training, NetSuite support and more. Our more than 170 full-time consultants are U.S. based and average more than 20 years of ERP experience. To learn more about how NetSuite can transform your inventory management, contact us to request more info.