“Uncontrolled inventory is the number one enemy of business cash flow,” Mr. Nguyen Duc Tai, Chairman of Mobile World, emphasized at the 2022 Ho Chi Minh City conference. Goods are piled up in warehouses, capital is “buried”, storage costs eat up profits, while customers complain about the lack of timely products.
Excess inventory is not just a technical problem – it is a strategic vulnerability that threatens the growth of your business. While you are struggling, your competitors are leveraging technology to deliver faster, at lower costs, and capture the market. Entrosoft, with its EntroSCM solution, is the “secret weapon” that helps you untie inventory bottlenecks, turning the supply chain into a competitive advantage. Let’s analyze this issue in depth and discover how EntroSCM brings Vietnamese businesses to the top!
EXCESS INVENTORY: A WARNING FOR VIETNAMESE BUSINESSES
Excess inventory is becoming a “strategic nightmare” in the context of a volatile global economy. Supply chain bottlenecks – such as port congestion or raw material shortages – are gradually removed from mid-2022. Consumer demand declines. Inflation and tight monetary policy make consumers in the US and EU – Vietnam’s two main export markets – spend less, leading to a serious backlog of goods. Inventory not only “eats up” capital but also entails a series of consequences:
Rising storage costs: Logistics costs in Vietnam account for 16-20% of GDP, higher than Thailand (11-13%), according to Vietnam Investment Review, 2023. Warehouse rent, electricity, labor, and storage costs eat into profits, especially when inventory is damaged or obsolete, such as in the food and fashion industries.
Missed business opportunities: Capital tied up in inventory prevents you from investing in new products, expanding into new markets, or improving technology. “Cash is king, and inventory is a robber,” Jeff Bezos, founder of Amazon, once emphasized the importance of effective inventory management.
Losing customer trust: Incorrect forecasts leave you short of products customers need, while your warehouse is full of unsold goods. Vietnam E-commerce Report, 2023 recorded that 80% of Vietnamese consumers expect to receive their goods within 1-2 days. If they cannot meet this, they will switch to competitors like Shopee or Lazada, which have invested heavily in automated warehouses.
Excess inventory is not just a short-term problem – it is a strategic warning that your business needs to change to survive and grow. “Incorrect inventory is a failure of the whole system, not just the logistics department,” Mr. Tran Dinh Thien, former Director of the Vietnam Economic Institute, emphasized at the Hanoi conference in 2023. While competitors are quickly applying technology to optimize the supply chain, you cannot stand still!
WHY IS EXCESS INVENTORY A "TIME BOMB"?
To thoroughly solve the excess inventory, it is necessary to isolate the root cause:
Poor demand forecasting: Market volatility due to inflation, trade wars, and changes in consumer behavior makes forecasting difficult. Many Vietnamese businesses still rely on outdated experience or tools, leading to large errors. For example, in the food industry, incorrect forecasting of Tet sales volume can lead to damaged goods or months of backlog.
Manual warehouse management: According to VCCI, 2022, 65% of small and medium enterprises in Vietnam have not applied a modern warehouse management system. Manual processes such as using Excel cause inventory errors, loss of goods, and slow order processing.
Asynchronous data: “Asynchronous data is the number one enemy of good decisions,” an expert on Business Insider, 2021 emphasized. PwC Vietnam, 2022 pointed out that 70% of Vietnamese enterprises have difficulty integrating supply chain data, causing leaders to lack a comprehensive view.
Lack of technology investment: While international and domestic giants such as Amazon or Shopee invest in automated warehouses and ERP, many Vietnamese businesses still struggle with outdated technology and cannot optimize their supply chains.
These causes create a vicious cycle, pushing businesses into a state of excess inventory, increasing costs, and losing competitiveness. But don't worry - Entrosoft with the EntroSCM solution is the key to breaking this vicious cycle!
ENTROSCM INTEGRATED WITH AI TECHNOLOGY: BREAKTHROUGH ERP SOLUTION FROM ENTROSOFT
EntroSCM is an advanced ERP system, integrating AI, Big Data, and automation, specifically designed by Entrosoft for Vietnamese enterprises. Beyond addressing excess inventory, EntroSCM helps optimize the entire supply chain, from demand forecasting to final delivery. Here’s how EntroSCM turns challenges into opportunities:
Ultra-accurate demand forecasting: AI analyzes market trends, sales history, and economic fluctuations, helping to predict demand with high accuracy, reducing forecast errors by 30%. For example, in the retail industry, you will know exactly how much inventory to import for peak seasons like Tet, avoiding inventory or shortages.
Smart warehouse management: Real-time inventory tracking, automatic import suggestions, warehouse space optimization.
Comprehensive data synchronization: Connect warehouse, shipping, purchasing, and sales in a single system, ensuring data transparency. Intuitive dashboards provide a 360-degree view, helping you make quick and accurate decisions.
Lightning-fast delivery: Automatically schedule shipments, track shipments, and integrate with carriers for on-time delivery. EntroSCM increases on-time delivery rates by 40%, meeting Vietnamese and international customer expectations.
Efficient supplier management: Evaluate performance, manage contracts, and reduce risks through an integrated portal, helping you avoid disruptions like the 2021-2022 raw material crisis.
Absolute security: Encryption technology and continuous monitoring protect the system from cyber attacks, ensuring uninterrupted supply chains.
Track anytime, anywhere: Mobile-friendly interface and optimized web application (PWA) let you check your supply chain anytime, anywhere, whether you're in the office or on the go.
GOLDEN BENEFITS FROM ENTROSCM FOR BOSSES
With EntroSCM, you not only overcome inventory pain but also lead the market:
Increase profits: Reduce warehouse and operating costs, increase profit margins by 20%, according to Supply Chain Quarterly, 2023. You have more resources to expand markets or improve products.
Make fast, accurate decisions: Real-time data helps you react quickly to market fluctuations. “Speed and precision are the keys to modern leadership,” Jack Welch, former CEO of General Electric, once emphasized.
Outsmart your competitors: Fast delivery, low cost, good service – you dominate the market against slow competitors, especially in retail and export.
Reduce stress: Automating and making processes transparent saves you from having to “fire-fight” every day, giving you time to focus on big strategies like global supply chain integration.
Building a strong brand: By doing well in ESG, you meet the requirements of international partners, enhance your reputation, and attract investors, especially when Vietnam is a destination for large corporations such as Apple or Samsung.
TOP 5 REASONS BOSSES SHOULD CHOOSE ENTROSOFT
Entrosoft not only provides software but is a strategic partner to help Vietnamese businesses develop.
1. Deep understanding of the Vietnamese market: With more than 10 years of experience, Entrosoft understands the pain of Vietnamese businesses, from high logistics costs to dependence on foreign suppliers.
2. Suitable for all sizes: From SMEs to large corporations, EntroSCM is customized to meet specific needs, especially in the retail, manufacturing, and logistics industries.
3. Smooth connection: Integrate with other software, ensuring seamless management system, no worries about clutter.
4. Advanced technology: Use AI, Big Data, and IoT to stay ahead of your competitors in the 4.0 era.
5. Dedicated Support: The Entrosoft team provides 24/7 consulting, implementation, and support, ensuring you get the most value from EntroSCM.
