Why switch from Excel to inventory planning software
It makes sense for every retail business, everyone involved in supply chain planning to make the change and switch over to some process automation, the more the better. The more you delegate to the machine, the more creative you could be about your business strategies, your product, your partnering, your choice of vendor and customer, your time. Each planner runs into this. All the routine labour that comes with demand and inventory planning for your specific model of business.
You would never predict all the situations you have to account for and the methods you will have to use to account for them. So, custom, complex, smart, automated software solutions are the next logical step. It’s the change you’ll have to accept to be able to move forward in the modern world of the supply chain.
Every retail planner deals with the same range of pains when it comes to predictions and inventory planning. Wherever you have to make predictions about something, and/or stock up accordingly, be it planning for grocery stores, machinery, or production, selling fishhooks or automotive parts, or airline seats, you have to deal with spreadsheets.
Put into a bullet list of pain points, it would look like this:
It could be a lot better, and it’s creating an error, taking away from sales or tying up capital.
Accurate demand forecasting is something most planners rely on increasingly. It’s the source of all the subsequent decisions made. Doing it manually will produce barely the same results, likely less accurate, while making you spend loads of time just crunching those numbers, copy-pasting, deleting, writing formulas, double-checking, and filtering.
…which, multiplied by regular repetition and the random human factor turns into a whole task.
Sometimes you even have to create a platform from scratch and a logic to follow when doing inventory management. And sticking to it forever ends up taking a lot of your time.
Using the pre-developed forecasting models, applying them here and there, certainly passes for template work, but those are still not able to fill most strategic gaps, doing which is what will take most of your time and effort.
You are always stuck at a level of details, trapped in the vicious circle of repetition, detailed data processing, you will only have enough resources to be the cog in your own machine, which is not a good long-term business strategy for anyone.
This one requires no commentary, but to say it’s tedious is to say nothing at all.
It could be just one, but more likely it’s an overwhelming number of datasheets, in a succession, that also needs to be spread and updated among all of the team members.
… doing it without a systematic approach is basically stone-age methods.
Consciously accounting for every outlier, promotion or special event every time. Chalking this up to the previous point as the areas of most tedious labour and ones most susceptible to human error, making them a minefield of setbacks and time-consuming tasks.
That’s one side and one number of reasons to make the transition but the flip side is even tastier.
You can’t keep wasting all of that time and still think you’ll keep up with the game when literally everyone is automating. This is like the next step after the invention of word-processing software for personal computers, which is when you should’ve stopped using actual paper.
The reasons include a range of different dimensions, but we’ll be able to weave the biggest ones into this article.
Truly vast is the range of positive benefits. First of all, comes
- Automating the whole process.
Having to remember fewer steps is a huge improvement. The process of multiplying trends, calculating safety stocks, removing outliers on the timeline, dancing around the lead times and supplier restrictions, etc., can be abandoned. You could get out of the routine you’re so used to and see a wider horizon of better tasks you could be performing instead.
- Doing it in a completely transparent way
Apart from proprietary technology, which can sometimes be a secret, the whole process is open and clear for everyone. That allows you to involve a lot more people into planning than previously. You don’t need the hard-labouring Excel expert and everyone else using their sheet – everyone could be equally proficient and on the same page all the time.
Have your instruments meet your intentions.
- Able to seamlessly pull data, process data and output actions.
Requiring only confirmation or some minor amendments from the decision-maker to keep the ball rolling.
- Saves time, human error and adds machine precision to each calculation
…therefore outmatching any possible human results by far.
Let the machine take a great number of factors into account, do most of the dirty work and save you tremendous time and resources.
- Provides you with next-level intelligence
…opening up the doors to larger-scale strategic planning.
This one speaks for itself, basically. Instead of swimming in rows, having to paste values, pieces of tables, move blocks of text around, come up with formulas and macros, double-check everything for typos or errors if something goes wrong, what about scaling it up and shifting your business strategies based on data, that’s been reliably processed for you in seconds?
- Can account for patterned situations much better
There are some situations humans would be much slower to pick up and act on. Using machine learning and smart algorithms, demand planning software can have a much better eye for such things.
You could waste your time brainstorming trends every time, OR you could have the machine trace patterns and predict them for you in advance, based on probability and statistics.
Demand planning tools like Streamline have an extensive toolset, pre-set to account for:
- Trend outliers
- Lead time and order cycle
- Product shelf life (for pharmacies and fresh food retail)
- Supplier availability (events like the Chinese New Year, etc.)
- Supplier min and max lots
- Price elasticity
- Container load and rounding
- Inventory transfers between stores
- Material use in finished item production
- Forecast by SKU/Location/Channel
- Allows you to calculate KPIs precisely, on a larger scale, automatically.
…not just the usual ones, only faster and better, but also giving you some numbers you didn’t think to collect before.
Stuff like inventory turnover rate, released capital from utilizing stock, ROI you’re getting from using paid software and implementing different planning strategies etc.
Calculating KPIs is not something to be overlooked, because you need points of reference to measure your growth. And it can be something that’s often overlooked entirely, sometimes because it’s a pain in the neck.
Every demand- and inventory-planning process needs flexibility while it also requires precision and extensive accountability.
Exploiting an individual and their time and talents to achieve something like this is not necessary anymore, so you can allocate your creative human resources elsewhere important. Which is why you should do the switch as soon as possible. Leaving only the question of which solution to implement, which you can get help for, from the solution vendors.
Too much manual work in Excel?
Try Streamline free
- 99+% inventory availability.
- Up to 99% forecast accuracy.
- Up to 98% reduction in stockouts.
- Up to 50% reduction in excess inventory.
- 1-5 percentage points margin improvement.
- Up to 56X ROI in one year. 100% ROI in the first 3 months.
- Up to 90% reduction in time spent on forecasting, planning, and ordering.