How to Use AI for Intelligent Inventory Management
Artificial Intelligence (AI) is highly demanded practically in every industry. The greatest example of the successful usage of top-notch technology is the retailers and other e-commerce companies, especially, their inventory management system. AI provides powerful insights for organizations like trends identified from large volumes of data analyzed so that business owners and their warehouse teams can better manage the daily tasks of inventory management.
Improved decision-making, reduced costs, eliminated risks, optimized warehouse work, increased productivity are just a few benefits of the implementation of AI technology. According to the statistics, in 2020 about 45.1% of companies have already invested in automation of the warehouse and 40.1% in AI solutions.
5 Ways To Use Artificial Intelligence For Inventory Management
It’s estimated that AI can add $1.3 trillion to the global economy in the next twenty years if the technology is used in supply chain and logistics management. It’s because AI can make supply chain management more efficient at all stages.
Nvidia, IBM, Amazon, Facebook, Microsoft, Salesforce, Alteryx, Twilio, Tencent, Alphabet are a few big names among the companies that have already leveraged the benefits of AI. The following are 5 ways that AI is revolutionizing inventory management.
1. Data Mining and Turning It Into Solutions
AI is extremely helpful in data mining. AI solutions have the ability not only to gather but analyze the data to transform it into timely actions. Thus, AI implemented into the inventory management system helps the business to evolve more rapidly and find more effective solutions to a particular situation. By monitoring, gathering, recording, and processing the data and interests of every customer, businesses can understand their customers’ demands to build more effective strategies and pre-plan the needs of the customers and stock products.
2. Dealing with Forecasting, Planning, and Control Issues In The Inventory Management Process
Inventory management is not only about storing and delivering items but it’s about forecasting, planning, and control. By implementing AI solutions, you minimize the risks of overstocking and understocking thanks to the ability of the technology to:
- Accurately analyze and correlate demand insights;
- Detect and respond to the change in demand for a specific product;
- Consider location-specific demand.
AI-based solutions have the flexibility and ability to analyze all the possible factors and situations that are vital for the successful planning, stocking, and scheduling deliveries. Reducing the errors and issues in inventory management, the business can increase customer satisfaction and save costs.
3. Stock Management and Delivery
Planning errors and/or inadequate stock monitoring can result in shortages, delays, and other issues that affect the revenue. AI technology can be pretty helpful in it. The technology can collect the data about customers and analyze it to identify behavior patterns and other crucial factors that help:
- Plan the stocking right;
- Automate the stocking and fulfillment processes;
- Leverage and react to incoming customer demands on time;
- Establish efficient transportation and many more.
AI also can streamline deliveries and increase their efficiency. On-time deliveries and transportation are the fundamentals of supply chain management that have a huge impact on consumer satisfaction. AI analyzes and makes sense of all a company’s telematics data, helps to find the optimal routes to ensure the timely arrival of orders. Besides, the technology can identify any patterns and draw conclusions about the delivery processes of the company so that you can improve it.
4. AI-Powered Robots to Optimize Warehouse Operations
AI-powered robots are not a new thing. Such giants as Amazon have already used them for day-to-day tasks. It’s forecasted that the robot automation market’s value will reach $10+ billion by 2023. There are a number of benefits that put AI-based robots over human staff:
- They can work 24/7 tirelessly;
- Robots work with more optimal time per action;
- They can locate wares and scan their conditions, collecting the needed data for further analysis;
- They provide real-time tracking of products;
- Robots can select and move orders, reducing manual errors;
- They perform inventory optimization, and so on.
All that can save a business a big chunk of the operational budget. Besides that, AI-powered robots used in warehouses free employees so that they can be allocated for more urgent and vital tasks that require human cognition.
5. Logistics Route Optimization
One of the most critical components in logistics is route optimization. By implementing AI solutions, companies can reduce time lost in traffic, provide faster delivery times, and in such a way save costs. That’s because AI can help in:
- Lowering shipping costs by learning all the possible variants and finding the fastest and most cost-effective ways to deliver the orders to the customers.
- Planning the most optimal routes. AI can learn traffic patterns over time, analyze the received data, and consider the different factors while routing. All that enables the drivers to avoid traffic jams more effectively.
- Calculating more precise delivery time. Using complex algorithms, AI technology can calculate the delivery time more accurately by taking into account historical and real-time data, optimal routes, and other factors that can affect delivery efficiency.
AI has revolutionized and reshaped both inventory management and the way companies stock and store products. The AI solutions implemented to enable the businesses to make the inventory management pre-planned, automated, based on customer demands, and even carried out by robots. AI empowers companies to:
- Enhance user experience and consumer satisfaction;
- Increase sales;
- Reduce costs;
- Boost the overall productivity of the company.
AI is the future of the industry. Thus, if you want to stay competitive, you should implement the technology as soon as possible. The results can be outstanding.