Inventory and Shipping Software: What Is It and How Does Impact Costs?

Inventory management isn’t easy—and neither is shipping. So when you start to think about the two of them together, the complexity only increases. Unfortunately, that’s the reality for most businesses that have to deal with the last mile.

The right software ecosystem can make a big difference in terms of helping businesses, but how do you figure out exactly what that ecosystem looks like? After all, there’s a range of different inventory and shipping software options out there that run the gamut from small, free ecommerce solutions to behemoths like NetSuite—how are you supposed to determine what’s right for your business based on your specific needs and initiatives? 

We’re here to help. In this post, you’ll find a rundown of inventory and shipping software’s ins and outs, as well as a quick guide to how the right software can reduce costs and enable smarter delivery and inventory operations.    

Challenges in Delivery and Inventory Management

Delivery and inventory management have distinct challenges that can take work to overcome at an operational level. 

Delivery management

Getting the right goods to the right place at the right time means utilizing your delivery capacity effectively—but in order to do that, you first need visibility into what that capacity actually looks like. You need to be able to schedule a doable number of stops per truck per day (something that varies depending on what you’re delivering at any given stop) while ensuring that drivers are able to deliver on time. 

All the while, you need to keep the customer informed of what to expect, and you need to track deliveries in real time in order to manage exceptions as they arise. One of the biggest challenges in delivery management is bridging the gap between planning and execution, and that’s something that depends to a large extent on visibility. 

Inventory management

Do you have the right inventory to hand when you need it? Do you know when that inventory is going to arrive? How do you minimize the footprint of your warehousing operations without running so lean that you risk stockouts and delays? 

It’s a delicate balancing act—one that requires a lot of things to go right every day. Like with delivery management, the devil isn’t just in the details, it’s in gaining the visibility to actually see the details. 

Inventory and shipping

None of these challenges exist in a vacuum. A big part of the ability to effectively manage the last mile of your supply chain comes down to making sure you actually have the inventory you need to ship from the locations you need to ship it from. By the same token, inventory challenges are also partially transportation challenges: is everything moving into and out of the warehouse doing so at the right time? 

The upshot here is that these processes need to be closely aligned if you’re going to get them right. That means ensuring that you either cover them both with the same system, or make sure that the systems you’re using are interoperable and built for flexibility. 

What’s the Right Approach to Streamlining Inventory and Delivery Management?

There are competing philosophies here, but the real answer to how you administer these different aspects of the supply chain will depend on your business needs. 

A smaller ecommerce outfit with a relatively straightforward logistics chain can probably get away with a single solution for inventory and shipping—something that makes it easy to track what you have in the warehouse and get items shipped to the right place as orders come in. 

For larger operations—or businesses dealing with big and bulky items (furniture, appliances, pallets of food and beverage, building materials, etc.) all-in-one solutions might be less workable. Instead, you might opt for separate inventory and delivery management solutions that integrate closely with one another. 

Here are a few advantages of that approach for businesses with more complex fleet operations:

• More specialized route optimization: Generating delivery routes that work for delivery runs involving different service times on site, installations and other services, skill-level differences, etc. can be difficult without the right tools. It’s tough to find route optimization capabilities that can quickly and accurately deal with a wide range of different use cases outside of specialized last mile delivery software. 
• Easier driver integration: When you have a separate last mile delivery solution, you can usually house your driver management news within that software. This means that drivers are more closely connected with dispatchers and can share updates more quickly—improving visibility across the board in the process. 
• Smoother integration across the entire fulfillment and supply chain: Even if you’ve got shipping and inventory housed under one roof, you still have to connect those solutions to whatever you’re using for the first and middle miles (to say nothing of your point of sale, ERP, etc.). When each function is clearly delineated and is set up for easy connectivity across the board, each part of the technology stack can add value to the others. 

Of course, all of this is a matter of finding the right solutions—for both inventory and delivery management. To do that, you need to look out for the features and capabilities that will help you reduce costs across both areas.  

How Can Inventory and Shipping Software Reduce Costs?

To find inventory and shipping software that will actually help you reduce costs, you need to know what cost areas to target. To that end, here’s a rundown of some of the ways that the right technology can help you reduce logistics costs:

• Shrinking your inventory footprint: When you can reduce the square footage of warehouse space you need, you can reduce costs. To make that happen, you need to find ways to decrease the lead times for getting product out the door. That can be done a number of different ways, but speeding up your delivery routing and scheduling can be a huge part of it. 
• Decreasing manual data entry and communications: Phone calls are anathema to efficiency. So are spreadsheets and manual data entry tasks. Smart software with automated functionality for delivery tracking, customer communications, and data sharing can be a big help in this regard. Read our latest ebook, No Spreadsheets, No Phone Calls: Building a Smarter Last Mile, to learn more about this topic. 
• Reducing person-hours for planning and execution: For a lot of businesses, routing can be incredibly time consuming. So can inventory tracking, return management, and other tasks—many of which go a lot more quickly when you have the right software. These saved person-hours can be reinvested in more value-additive or strategic tasks. 
• Fewer exceptions and disruptions: Again, when you have delivery and inventory plans that you can actually execute, there are fewer disruptions that cause money in the short and long-term. When your inventory, delivery planning, and delivery execution are closely aligned, there’s a reduction in unplanned returns, less damage to undeliverable items, and fewer costly redelivery attempts.

Curious to see what the delivery portion of what we’re discussing would look like in proactive? Check out this self-guided product tour: https://www.dispatchtrack.com/thanks-product-tour