Inventory management software explained

Let’s start by defining the basic purpose of each system. An inventory management system (IMS) is software that is designed to streamline the process of ordering, storing, using and tracking stock. It provides real-time visibility of inventory as it moves through your warehouse so you know exactly what stock you have on hand and where it is located.

An IMS can offer features to automate the process of reordering stock, forecast demand for certain products, utilise barcode scanning and optimise storage space. If it offers integration capabilities, the system can be connected to other platforms like an order management system, accounting solution or ERP platform, allowing you to manage all your critical business functions in one place.

How does an order management system work?

An order management system (OMS), meanwhile, is software that helps optimise the range of processes required for efficient order fulfilment – from picking and packing and monitoring orders, to selecting couriers and handling returns.

The best systems can help you integrate all your sales channels so you can monitor all your orders in one solution. They can also enhance picking accuracy with barcode scanning and voice-assisted commands, and can keep all your sales and inventory data in sync so you always have a complete, real-time view of orders and available stock.

An OMS can also automatically select the most cost-efficient couriers and provide features to facilitate time saving strategies like batch picking.

How are inventory management & order management systems similar?

There is some overlap between inventory management and order management systems in terms of the benefits and features they offer. Both types of software can provide:

1. An enhanced view of inventory

An order management system can include inventory management features that, like those of an IMS, provide a real-time view of inventory. Both solutions can offer features to optimise stock control, automate stock replenishment and use storage space more efficiently.

An inventory management system may offer more advanced features to manage stock, but both types of software can give you a clear idea of stock movements as well as simplify stock counts, the receiving process and the management of multiple warehouses.

2. Consolidation of business and ecommerce platforms

Another aspect some inventory management and order management systems have in common is the ability to integrate with other platforms, like your accounting or CRM solutions.
They can also offer integrations with leading marketplaces like Amazon and eBay, as well as shopping carts like Shopify and Magento, in addition to courier and multi-carrier platforms. And of course, both systems have the ability to integrate with each other.

Having all these critical platforms consolidated in a single system saves you countless hours and frustration. For example, you will no longer need to log in to multiple different platforms. And you can start automating certain processes like courier selection, plus remove the need for manually tracking orders in separate marketplace platforms, as all your sales channels are consolidated in one place.

3. Optimised processes and time savings

Both inventory management and order management systems are built to eliminate the error-prone and labour-intensive manual tasks that hold so many ecommerce businesses back. They can remove the need for clunky spreadsheets and double entry, and even save time for pickers, for instance, by providing optimised picking routes.

Rules-based automation features are common between the two systems. For instance, you can set up rules so orders are picked and packed based on specific attributes like size or date. Or rules that automatically determine how and when to order new stock, or which courier to select for delivery.

How do inventory management and order management systems differ?

1. Same how, but different why

Both systems allow you to optimise internal processes, automate manual tasks and gain real-time visibility. But the key difference between the two is the fundamental end goals of each.

For an IMS, its ultimate aim is to ensure you always have adequate stock on hand and full visibility of goods as they move into, through and out of your warehouse.

On the other hand, an OMS’s chief purpose is to ensure an optimal customer experience, namely one that facilities effortless purchase and hassle-free delivery, and where they are kept in the loop as their order progresses.

2. In the here and now vs looking ahead

The other fundamental difference between the two systems is that an inventory management system is concerned both with the present and looking ahead, while an order management system is very much about what is happening in the here and now.

An IMS offers features that allow you to track and control stock movements in real-time, as well as those that allow you to predict future inventory needs. For instance, you can forecast demand for certain product lines based on historical sales data or seasonality, and therefore plan stock orders accordingly.

Meanwhile, an OMS is very much about monitoring and managing day-to-day processes as they happen, like those involved with picking, packing and delivery.

Benefits of integrating inventory and order management systems

The software market offers nothing if not a diverse range of software solutions, each with their own strengths and weaknesses. Some solutions offer pure inventory management features, while others focus more on order management.

Other solutions, however, offer both an IMS and OMS in one fully integrated platform so you can reap the benefits of both worlds. Such solutions give you the ability to forecast product demand to ensure your stock control is always one step ahead, while also helping you efficiently manage and track orders to ensure the best customer experience.

Our cloud-based Access Mintsoft solution offers inventory management, order management and warehouse management capabilities in one easy-to-use platform. It is trusted by over 600 ecommerce businesses worldwide to automate manual tasks, optimise inventory management, simplify warehouse processes and get orders out faster.

The solution boasts over 175 pre-built integrations with leading couriers, multi-carriers and marketplaces, as well as API functionality to connect platforms like your accounting or ERP solution. Plus, you can ensure a smooth and timely implementation with our FlightPaths service, along with ongoing technical support.