The Two Sides of Inventory Management

Visit Website View Our Posts

If you're in a business that manages inventory, you know there are numerous daily tasks that must be handled to keep things operating smoothly. Often, the first tasks that inventory managers think about relate to items on hand -- location, physical counts, and so on. In reality, this only the first half of inventory management. There is another side that often gets neglected

So let's break down the two sides of running your inventory.

These two aspects of inventory management might sound similar, but they actually involve very different processes and tools. Ultimately, they work hand in hand to help you create a smarter and more profitable warehouse. Both are critically important to running a successful distribution or manufacturing business.

The two sides are Inventory Control and Inventory Replenishment.

Inventory Control handles the inventory that is already in your warehouse. In conjunction with your ERP, an Inventory Control solution organizes the follow key areas:

  • Receiving inventory
  • Processing stock takes
  • Processing inter-branch transfers and receipts
  • Picking, packing, and shiping stock
  • Processing purchase orders on suppliers
  • Processing customer invoices on your sales


Inventory Control is the supervision of non-capitalized assets (inventory) and stock items. If you’re still relying on spreadsheets and data dumps from your ERP, you should take a look at scanning solutions that help you stay in control of your inventory. 

On the other hand is Inventory Replenishment, which is the strategy for balancing the amount of working capital that is tied up in inventory with service-level goals across multiple stock-keeping units (SKUs). Inventory Replenishment offers advanced forecasting to ensure that you always have the right quantity of the right product at the right time and in the right location. Inventory Replenishment tools provide:

  • Demand planning and forecasting
  • Calculating safety stock
  • Calculating reorder points
  • Identifying fill rate %
  • Identifying obsolete items
  • Streamline your ordering process
  • Optimizing warehouse levels


Here's visual to help you sort out the differences between these two sides:

Two Sides of Inventory Management
Inventory Control and Inventory Replenishment


Basically, the distinction comes down to this: Inventory Control is all about keeping your inventory sorted, scanned, and organized. Inventory Replenishment is all about keeping the right levels of inventory so you never have too much or too little at any given time.

For both sides of inventory management, using the right tools to handle the above tasks is absolutely critical. Unless you're in a very specific (and likely small) environment, keeping track of your items will require scanning technology that feeds the data directly into your ERP. Similarly, if your supply chain includes any standard complexities, you need a tool that helps you keep your levels at the optimal amounts through a more automated ordering process.

Using the wrong tools to do these jobs will result in a disorganized inventory that keeps too much of some items and not enough of others. Orders will take too long to process, fill rates will be at a lower level, and the profit of each sale will be dramatically hindered by time-consuming processes that keep you in the dark.

When it comes to Inventory Replenishment, there is no better or more affordable tool on the market today than NETSTOCK. With robust analytics and algorithms, NETSTOCK allows you to have they visibility into your inventory levels that you've always needed -- that means eliminating stock-outs and cutting costly excess stock. The end result is smarter purchase orders that help you keep costs down while boosting your service to your customers. If you haven't seen the app in action yet, take a few minutes to watch this video. You can contact us anytime to learn how NETSTOCK could free up significant amounts of your working capital.

2 thoughts on “The Two Sides of Inventory Management”

  1. When you hear of liquidation in the media, it is compulsory liquidation, which is when you are forced to liquidate by law. Compulsory liquidation is the last resort for a business. It involves selling off every aspect of the business, from their inventory all the way up to their debts. When a company is compulsory liquidating, they are closing their doors for good.

  2. I would love to thank Eric Graf for the incredible content.

    Previously I had a thought that inventory management is one single term. After reading this content, I came to know about inventory control and inventory replenishment. These are two important aspects which are mostly overlooked by retailer and supplier. For kind information, every businessman needs to understand it and find simple ways for automation. Similarly, I have come to a software program called My OTB Plan for automation, management and control of inventory. Anyone can predict future sales and requirement with the tool. You can know better from the website. Keeping everything aside, the blog was really amazing to read and informative. I would love to read more and share with my friends and colleagues. Keep on writing!!!

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Show Buttons
Hide Buttons