13 April, 2022


Inventory management systems allow you to track and monitor product levels in your warehouse to ensure the right number of products are available to fill orders without leading to waste. There are several ways to manage the flow of inventory as it is manufactured, stored, used, sold, shipped, or disposed of in your operations. A perpetual inventory system allows companies to continuously track products from all sales avenues.

Under a perpetual inventory system, inventory counts are updated daily. Management and sales teams obtain real-time data on a consistent basis. In many cases, a company relies on technology and software to perform the tracking and monitoring, instead of having workers perform a physical count during specific periods. This method can help save manpower, although the costs for technology may become prohibitive based on the size of the business.

The types of technology often used for this inventory control may also vary depending on the management solutions you want to deploy. So, what is perpetual inventory technology? Common systems include barcode systems, RFID systems, robotics, and real-time data captures. Read on to learn more.


Barcode systems involve using automated tracking methods to track where inventory moves in operations. Workers place barcodes on items and in warehouse positions where products are located, such as shelves or bins. When a worker moves a product to a certain location, the item’s barcode and the location barcode are scanned with a handheld barcode scanner. The scanner uploads the information wirelessly into a warehouse management system (WMS).

An advantage of using barcodes in a perpetual inventory system is that the information is constantly updated whenever a worker touches that product. This process ensures that product inventory levels are only updated when there is specific product movement.

Disadvantages to the system would entail investing in the handheld scanners for all workers and ensuring the scanners integrate effectively with your WMS. Also, you must ensure that barcodes are correct and that workers perform every scan.


A radio frequency identification (RFID) system is similar in many ways to a barcode system. Instead of placing printed barcodes on products, small RFID tags with tiny microchips are attached to products. Antennas are placed in facilities on goods inward doorways. In a perpetual inventory system, whenever a worker carries the tagged product, the RFID tag interacts with an antenna. The data is then sent to software applications.

Companies may prefer an RFID system, as workers do not have to constantly scan products or location barcodes, so inventory data is instantly transmitted. However, keep in mind that workers must pass the products through the gates for the product numbers to be updated, so this system may not prevent human error or theft.


Many companies use robotics in a variety of ways to help manage inventory. These mechanized systems may involve using autonomous mobile robots, automated sortation systems, and automatic guided vehicles to move products through a warehouse or perform pick and pull inventory tasks. Other systems may also include pick and pull lighting systems. Often, robotics will be included in other perpetual inventory systems, such as RFID or barcodes, to provide a versatile solution.

One disadvantage to robotics is that they require a large initial investment. While larger companies may have the working capital to invest in robotics, smaller companies must select a system that will not put a financial strain on their resources.


The perpetual inventory method requires the capturing of data throughout the day whenever there are any changes or movements with products. Real-time data capture, also called real-time inventory, involves using software to automate the recording of sales and purchases. This software works at the sales team level with purchase and customer orders.

This system is usually used with other inventory control methods as another avenue to manage inventory levels. One thing you need to keep in mind is that this software requires the accurate input of sales orders into systems. Inventory errors may occur due to data and order discrepancies.


Implementing the perpetual inventory method offers companies a way to track inventory to minimize waste, theft, and misplaced products. These technological solutions can also streamline operations to make them more efficient and help increase productivity without overstocking too much inventory at one time.

At WSI, we offer warehousing and distribution solutions as part of our 3PL strategies. We invest in the latest technologies for our warehouse management services that allow companies to better manage their inventory levels without having to personally invest in the technology. Contact WSI to learn more about how our 3PL services may help your company’s supply chain.

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