How Does the IoT Improve Inventory Management?
The IoT has become an indispensable tool for many businesses. As rising demand and worker shortages push facilities to improve further, the IoT’s benefits become all the more enticing. Inventory management, in particular, stands to gain much through IoT adoption.
Inventory management is ripe for disruption, and the IoT is the ideal solution. As of 2017, 84% of small businesses used outdated or limited inventory tracking solutions. IoT sensors provide more visibility, efficiency and versatility than any other solution.
Many facilities have already seen impressive results with IoT inventory optimization. The industrial world still has a long way to go to take full advantage of this technology, though. As more businesses wake up to IoT’s benefits, it could change the face of inventory entirely.
Efficiency
Efficiency gains are by far the most immediately recognizable and enticing benefit of IoT inventory optimization. Experts have estimated that the IoT could save $3.7 trillion a year through productivity improvements alone. In inventory operations, these gains come mostly from transparency and ease of access.
Inventory constantly moves during peak seasons, with products coming off the shelves and being returned at staggering rates. Traditional systems relying on manual data input quickly fall short. Employees may forget to scan an item or record data incorrectly, and even if everything is correct, it’s slow.
Since the IoT equips workers with real-time data, it eliminates confusion and disruptions from slow inventory updates. Keeping all this information in a single, digital platform enables employees to see where any item is at any given time. Many IoT inventory tracking systems also register where an item is automatically, removing the risk of human error.
Data Visibility
The transparency of IoT inventory solutions isn’t just beneficial for a facility’s operational efficiency. The more IoT devices a warehouse implements, the more data points it has. This visibility gives them operational information they may not have otherwise, paving the way for ongoing improvement.
The IoT comprises more than 30 billion devices, with each one gathering data a facility could find useful. Something as simple as RFID tags could reveal which items workers pick most often during a certain season. Warehouses can then take this information to reorganize their inventory, placing frequently picked items together and enabling higher efficiency.
Similarly, IoT product tracking can reveal how far employees have to travel between different shelves and stations. This data can show where and how an inventory might be poorly arranged, limiting productivity. Once facilities know where to improve, they can act upon it and become better.
Product Quality
IoT sensors in warehouse inventories can track more than just location and movement. Another leading advantage of IoT inventory management is improvements to quality assurance. Since these devices can gather and report real-time information about an item and its environment, they’re useful monitoring tools.
One of the most prevalent use cases of IoT in quality monitoring is with refrigerated products. By installing sensors in fruit containers, grocers and food companies can monitor the temperature of their produce throughout the supply chain. If the refrigeration system malfunctions, they’ll know about it and can act accordingly before the produce spoils.
Without wirelessly accessible, real-time monitoring, companies couldn’t respond to product spoilage until it’s too late. IoT devices provide that service and automatically adjust factors like temperature, light, or energy consumption. Since some products become unusable or even dangerous without proper storage conditions, this advantage is hard to ignore.
Safety
Safety may not immediately come to mind when thinking of the IoT, but this technology can make workplaces safer. Inventory management involves machines like forklifts and automated material handlers, not just people. Employees must be keenly aware of where everything and everyone is to avoid collisions and stay safe, which isn’t always easy.
Workers may not see a forklift or other machine around the corner of a shelf. IoT devices on these machines and worker ID badges can alert employees if they get too close to an oncoming vehicle. This same technology can help workers stay distant from one another in the event of a disease outbreak.
Avoiding accidents has an economic impact as well. Employers pay $1 billion per week in workers’ compensation alone, which doesn’t even account for lost productivity. As the IoT makes warehouses safer, it further improves their efficiency and profitability.
IoT Technology Will Transform Inventory Management
From efficiency to safety, businesses have plenty of room to improve when it comes to inventory management. IoT technology provides an answer for all these shortcomings if companies implement it effectively. As these benefits become more clear, IoT sensors will become a workplace standard across all industries.
Many companies are already experiencing the benefits of IoT inventory optimization, and many more will before long. These technologies are so advantageous that their implementation in this field is inevitable. It may not be long before most companies rely on the IoT to drive their inventory operations.
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