In the past decades, the process of managing inventory has changed significantly. Manual inventory management used to be a standard practice for all businesses. Nowadays, many companies in the eCommerce sector, hospitality industry, and other markets use powerful tools to help them manage inventory. These solutions have numerous advantages compared to managing inventory on paper sheets. However, they also have cons. In this post, we’ll share more about manual vs automated inventory management. We’ll also shed some light on the different tools included in inventory management systems. If you’re interested in this topic, perhaps you’ll be interested in warehouse process flows or restaurant technology.
Key takeaway: Although fewer and fewer businesses use manual inventory management, it’s still a practice that’s suitable for certain small businesses. Automated inventory management, along with its additional features like predictive ordering, demand forecasting, alerts, and real-time tracking, has become the go-to approach for most businesses.
Manual VS Automated Inventory Management and Predictive Ordering
What Is Manual Inventory Management
Manual inventory management means tracking inventory by hand. The process can be done on paper sheets or digital spreadsheets. The manual data is then entered into any digital systems the company uses.
What Is Automated Inventory Management and Predictive Ordering
Automated inventory management tracks inventory levels in real time. That means the tracking process is synchronized with order management systems, sales software (POS in case of restaurant businesses), accounting solutions, and other pieces of technology used by the business. Since automated inventory management systems are far more innovative compared to manual inventory tracking, they offer various additional advantages. For example, they have alerts for low stock levels and upcoming expiration dates. This can be particularly useful in the restaurant industry as businesses deal with a lot of perishable items. Automated reordering and predictive ordering based on demand forecasting are other features included in some inventory tracking systems. An automated inventory management system needs to be combined with other technologies, such as barcode scanners or inventory counting apps.
Manual VS Automated Inventory Management
There are both pros and cons for both the manual and the automated approach to inventory management. Business owners need to analyze the needs of their company in order to decide which one suits them better.
Pros of manual inventory management:
- It is a simple and efficient option for small businesses.
- It doesn’t require large investments in hardware or software.
- It can easily be switched in the future to automated inventory management.
Cons of manual inventory management:
- It’s labor-intensive and not suitable for medium or large enterprises.
- The chance of miscalculations or other types of human error is higher.
- The lack of real-time tracking can result in inventory problems.
- Tracking and analyzing inventory shrinkage, losses, or other trends is much harder.
Pros of automated inventory management:
- The accuracy is guaranteed by real-time inventory tracking.
- Discovering waste, analyzing food costs, and calculating restaurant profit margin is much easier.
- Automated inventory management can be scaled across multiple locations.
- These systems have various additional features such as predictive ordering, demand forecasting, and alerts.
Cons of automated inventory management:
- The initial investment in terms of cost, training, and setup can be large.
- Like any technology, automated inventory management requires a stable internet connection and good technical proficiency and support.
BlueCart’s Endless Aisle for Inventory Management
Our platform helps thousands of businesses with their inventory management needs. BlueCart’s Endless Aisle for wholesalers and hospitality businesses is an excellent solution that helps both suppliers and their buyers. From small catering businesses to large restaurant chains, various food service companies can benefit from our platform’s features. They include automated inventory management, predictive ordering, a user-friendly endless aisle experience, order history tracking, and more. Businesses in the hospitality niche market can use BlueCart’s inventory management features to avoid overstocking and understocking. In addition to these inventory-oriented tools, BlueCart also allows food service businesses that buy wholesale products to calculate the profitability of their menu items. That’s done thanks to BlueCart’s recipe creation feature. It’s integrated with the inventory management tools and assures smoothness. Furthermore, BlueCart’s platform can also be integrated with various third-party software solutions.
The platform also gives multiple B2B marketing options to specialized and broadline distributors. They can use BlueCart’s Endless Aisle as part of their wholesale marketing strategy. Furthermore, suppliers can also use the platform to automate and optimize other business processes such as delivery route optimization, invoicing, order management, and more.
Frequently Asked Questions about Manual Inventory Management VS Predictive Ordering
BlueCart has resources and information on various topics such as restaurant data analytics and top seafood dishes worldwide. Below we’ve answered common questions regarding manual and automated inventory management.
What Are the Different Inventory Management Methods?
There are several inventory management methods. Among the most popular ones are first-in, first-out (FIFO), last-in, first-out (LIFO), par level system, perpetual inventory, and just-in-time inventory (JIT). FIFO is the most widely used method in the food and beverage industry. That’s because the sector deals with a lot of perishable goods. Having a par level inventory system is suitable for food service businesses that have a fairly constant demand. Furthermore, it can be a great system for supplies such as napkins, minibar stock, wholesale cleaning supplies, and other non-perishable items used by hospitality businesses.
How to Transition from Manual to Automated Inventory Management?
In order to switch from manual inventory management to an automated system, business owners need to properly research the market. Finding out the optimal solution in terms of functionalities and price is a must. For some businesses, that might be a full-scale solution that also helps with other processes. Others might opt for a system that specializes in automated inventory management for their industry. Make sure to choose a solution that offers excellent customer support. You’ll need this expertise during the process. There are multiple additional tasks such as migrating existing data, setting up barcodes, and establishing inventory management protocols.
Can AI Manage Inventory?
In recent years, AI-powered solutions have been at the center of many innovations. Technically speaking, AI can manage inventory. However, these tools are only as good as the data they are fed. Furthermore, they are not immune to making mistakes. That’s why businesses rarely rely fully on AI to manage inventory. Instead, they might choose wholesale ordering software or inventory tracking tools that have certain AI-powered features. That way, it’s still your hand on the wheel, but the car is easier to drive. Large-scale enterprises that process a lot of data can integrate AI more broadly and efficiently.
BlueCart: From Predictive Ordering to Calculating Profitability
With a variety of tools and functionalities, BlueCart is among the best food inventory management solutions. Our platform is specifically designed to help businesses in the hospitality sector manage inventory. BlueCart’s Endless Aisle for restaurants is also a great tool to easily order in bulk and find vendors to partner with. Furthermore, BlueCart also has features related to calculating the cost of goods sold, profitability on menu items, and other important metrics. Sign up for BlueCart as a buyer and try all the tools our platform offers for food service businesses. If you operate a wholesale company, make sure to schedule a demo and see how BlueCart can be used to boost wholesale sales and streamline distribution processes.