Do you know, that 79% of the companies that utilize high-performing supply chain gains the potential to surpass the the average performance of the companies that lie within their industry?

As efficiency is interrelated with growth, it’s important to have an efficient inventory management system that provides better goods management, tracks inventory, collects revenue data, and more. Thus, if you are planning to develop a custom inventory management software and are looking for a complete guide on it that informs you about the cost, must-have features, time to market, and how AI can be beneficial in it then you are at the right place. 

With the help of our logistic app developers, we have crafted this guide which you must check out:

What Is Inventory Management Software?

Inventory management software is a specialized application that helps businesses efficiently oversee and control their inventory. It simplifies the process of tracking and managing stock levels, ensuring that businesses can meet customer demand while minimizing excess inventory and associated costs.

Here’s a breakdown of what inventory management software typically offers:

  1. Stock Tracking: Monitors the quantity of items in stock, allowing businesses to see what is available, what is running low, and what needs replenishment.
  2. Order Management: Handles purchase orders, sales orders, and returns. This ensures that stock levels are adjusted accurately when new products are received or sold.
  3. Reorder Alerts: Automatically notifies users when inventory falls below a predefined level, helping prevent stockouts and ensuring timely reordering.
  4. Inventory Valuation: Calculates the financial value of the inventory using methods such as FIFO (First In, First Out) or LIFO (Last In, First Out).
  5. Reporting and Analytics: Generate detailed reports on inventory performance, including sales trends, turnover rates, and stock levels, which aids in strategic decision-making.
  6. Integration: Often integrates with other business systems like accounting, e-commerce platforms, and ERP (Enterprise Resource Planning) systems to streamline operations and maintain consistency across functions.
  7. Barcode Scanning: Uses barcode or QR code technology to enhance accuracy in tracking and managing inventory, reducing manual data entry errors.
  8. Multi-location Management: Manages inventory across multiple locations or warehouses, providing a consolidated view of stock levels and enabling efficient distribution.

How AI In Inventory Management Will Shape The Future?

AI and ML transform inventory management by reading and analyzing vast sets of data that enhance future predictions, reduce risk, and more. Here are some points that AI can assist you with in inventory management that traditional inventory management systems cannot. 

AI Inventory Management V/S Traditional Inventory Management

  • Accurate Demand Forecasting: AI analyzes different sets of data, such as sales data, order sheets, market trends, and more to predict and place orders which eliminates the chances of your inventory running out of stock. 
  • Expiry Data Management: With the help of AI, you can track the expiry date of your products which allows you to quickly sell or dispose of them. You can apply discounts or implement new promotional strategies to clear your stock. This reduces stock waste in your business. 
  • Reduces Manual Data Entry: The traditional inventory management system depends on you to manually insert data and thus the chances of incorrect data insertion. AI can automate data entry tasks which reduces the chances of incorrect data insertion and also reduces manual work efficiency. 

How Does AI In Inventory Management Work?

Here is a graphical representation of how AI in inventory management works:

AI in Inventory management

How Much Does It Cost To Create An Inventory Management Software?

The cost of creating inventory management software depends on several factors such as the functionalities involved in it, the tech stack used, the development team’s location, and more. 

Here are some factors that influence the cost of developing an inventory management software:

Software Complexity

The complexity of the inventory software plays a significant role in determining the cost. A simple system with basic features like stock tracking and reporting will cost significantly less than an advanced system with features such as real-time analytics, AI-driven insights, multi-location support, and integration with other systems. More complex systems require more development time and resources, which increases the cost.

Features and Functionality

The number and sophistication of features in the software directly impact the cost. Essential features like inventory tracking, barcode scanning, order management, and reporting are common in most systems. However, additional features like mobile accessibility, third-party software integrations (e.g., accounting, CRM), automated notifications, and AI-based analytics can increase development time and cost.

Development Team Location

The location of the development team can significantly affect costs. For example, development in the U.S., Canada, or Western Europe tends to be more expensive, with hourly rates ranging from $100 to $250. On the other hand, development in countries like India, Eastern Europe, or Southeast Asia is generally more affordable, with rates ranging from $15 to $70 per hour. The expertise and quality of the team, however, should be carefully considered.

There are more such factors, but at Appic Softwares you can get your app developed within the range of $20K to $80K depending on the above-listed factors. 

Must-Have Features To Include In Your Inventory Management Software

When developing inventory management software, there are essential features that businesses should include to ensure efficiency, accuracy, and scalability. These features help streamline inventory processes, reduce errors, and provide valuable insights into stock levels and operations.

1. Real-Time Inventory Tracking

Real-time tracking is critical for maintaining accurate stock levels. This feature allows businesses to monitor inventory in real-time across multiple locations. It ensures that stock levels are always up to date, minimizing the risk of overstocking or stockouts. Real-time tracking also provides instant updates on sales, returns, and shipments, enabling businesses to make informed decisions quickly.

2. Barcode Scanning and RFID Integration

Barcode scanning and RFID integration simplify the process of updating inventory records. By scanning items as they are received, sold, or shipped, businesses can automatically update inventory data. This reduces manual data entry errors and speeds up operations. RFID technology, in particular, allows for fast and accurate scanning of multiple items simultaneously, making it an essential feature for larger operations.

3. Order Management

An effective order management system is vital for handling purchase orders, sales orders, and returns. This feature allows businesses to track orders from placement to fulfillment. It also provides insights into pending, fulfilled, and partially fulfilled orders, enabling better management of stock levels and customer satisfaction. Automated order processing can further enhance efficiency by reducing manual work.

4. Inventory Alerts and Notifications

Inventory alerts and notifications help businesses stay informed about critical stock levels. For example, low-stock alerts notify users when an item is running low, while reorder alerts can trigger automated purchase orders when inventory reaches a predefined threshold. These notifications ensure that businesses can avoid stockouts or overstocking, helping to maintain optimal inventory levels.

5. Multi-Location Management

For businesses with multiple warehouses, retail outlets, or fulfillment centers, multi-location inventory management is a must-have feature. This enables businesses to track stock levels across different locations in real-time. It also allows for stock transfers between locations and provides an overview of inventory performance at each site.

6. Supplier and Vendor Management

Managing relationships with suppliers and vendors is crucial for maintaining a healthy supply chain. The supplier management feature allows businesses to keep track of supplier details, monitor delivery times, evaluate vendor performance, and automate reorder processes. By having all supplier information in one place, businesses can negotiate better terms and streamline procurement processes.

7. Reporting and Analytics

Comprehensive reporting and analytics capabilities are essential for making data-driven decisions. Inventory management software should offer customizable reports on key metrics such as stock turnover, sales performance, order fulfillment times, and more. Advanced analytics can provide insights into trends, helping businesses forecast demand and optimize inventory levels. These reports are valuable for identifying inefficiencies and improving overall operations.

8. Automated Reordering

Automated reordering is a valuable feature that helps businesses maintain optimal stock levels. Based on predefined criteria such as minimum stock levels, sales velocity, or seasonality, the system can automatically generate purchase orders when stock runs low. This reduces the need for manual intervention and ensures a steady supply of products.

9. Integration with Other Systems

Inventory management software should integrate seamlessly with other business systems such as accounting, e-commerce platforms, CRM, and ERP. Integration ensures that inventory data is synchronized across all systems, improving accuracy and efficiency. For example, integrating with accounting software allows for automatic updates to financial records based on stock movement, while integration with e-commerce platforms enables real-time inventory updates on online stores.

10. Mobile Access

In today’s fast-paced environment, mobile access is essential for flexibility and convenience. Inventory management software with mobile access allows users to monitor and manage inventory from anywhere. Employees can check stock levels, scan barcodes, and process orders using mobile devices, increasing productivity and reducing the need for constant access to desktop systems.

11. Customizable Dashboards

A customizable dashboard provides users with an at-a-glance view of critical inventory data. Businesses can customize dashboards to display key performance indicators (KPIs) such as stock levels, top-selling products, and inventory turnover rates. This feature allows users to quickly access the information most relevant to their role, improving decision-making and overall efficiency.

12. Inventory Forecasting

Inventory forecasting is a powerful feature that uses historical sales data, trends, and seasonality to predict future demand. This helps businesses make informed decisions about restocking and managing inventory. Accurate forecasting reduces the risk of overstocking or understocking and helps businesses allocate resources more effectively.

13. User Roles and Permissions

Role-based access control is an important security feature that ensures only authorized personnel can access certain functions within the software. By setting different user roles and permissions, businesses can restrict access to sensitive information, such as financial data, while allowing other users to perform tasks such as inventory updates or order processing.

14. Inventory Adjustments and Auditing

Inventory adjustments are necessary when discrepancies occur between recorded and actual stock levels. This feature allows businesses to manually adjust inventory counts and provides an audit trail to track changes. Regular inventory audits help identify issues such as theft, damage, or data entry errors, ensuring accurate inventory records.

Conclusion

Now, in the end, we hope that through this post you were able to gain knowledge of inventory management software development. We recommend you to include AI in it to make it futureproof and manage your inventory efficiently. 

Moreover, if you are looking for a logistic software development company that has previously worked and developed inventory management software then you must check out Appic Softwares. We have experienced developers who use the latest technologies to build your solution. 

So, what are you waiting for?

Contact us now!