Companies require proper management of inventories as this ensures that they don’t suffer a loss from missing supplies, overstocking, or stock outs. The complexity of inventory processes usually depends on the size of the business.
Small retail businesses usually hire a one to five-men team to take care of inventory management tasks while the medium to high scale companies employ a larger group to oversee the critical process and all of these used to be done manually.
Thanks to the advancement of technology, walking into business and managing inventories nowadays is quite easier when compared with how they were years back. The current technology makes it easier for business owners to manage their inventories even at the comfort of their home. In this digital age, inventory-related data are now at businessmen’s disposal given the right inventory management software.
What is an Inventory Management Software?
An inventory management software is a powerful information system that provides an efficient and convenient way of tracking, managing, and organizing inventories which include goods in stock, properties, and supplies used or sold by a company. It may also feature advanced facilities like product sales, material purchases, and order and disposal monitoring. Given the automation of processes that this software provides, a company’s inventory process will no longer need logbooks and pens and will no longer need to maintain piles of documents to track and record inventory movements. Instead, this will likely be based on barcodes and radio-frequency identifications. With the use of inventory management software, a company’s inventory team will no longer spend as much time and effort in performing the tasks. This allows them to work on other things with equal importance.
Is it Really Necessary?
These days, the big and crucial role an inventory management software plays for many businesses is widely known. It has evidently served an efficient management solution that, in the long run , significantly maximized many businesses’ profits. The accuracy and availability of inventory-related data that can be achieved from using it alone already makes it a worthy investment.
But as a business owner, it is primarily your call whether to invest in an inventory management software or not. You can always say your team and processes are already great as they are and you need no further improvements at the present. But with all the benefits an inventory management system provides, it pays to have an open mind to properly assess whether there is truly a need to switch on an automated inventory process or not.
The 5 Advantages of Inventory Management Software
1. Perpetual Inventory Management
Maximizing the use of computers, perpetual inventory management is one of the amazing things an inventory management software caters. Back in the old days, inventory was done by either running a physical count on a periodical basis or reconciling the actual inventory figures with the figures shown on logbooks after orders and sales by the cut off date were all accounted for. The computerization of inventory processes provides an easier and more accurate perpetual monitoring of this. Sans the manual approach which is tedious and error-prone by nature, inventories will be managed more accurately and time-efficiently.
2. Accurate and Fast Inventory Counting
The use of inventory management software does not entirely eradicate all the manual processes although a big chunk of the tedious process will surely be omitted. In fact, even if your company has it, your inventory or audit team will still need to perform a physical count on a random interval to make sure your actual inventory records are in line with the figures shown on the system. But here, the greater advantage of an automated inventory management becomes clearer because it offers a faster and more accurate inventory counting.
A lot of inventory management software you can find in today’s market already feature bar-coding and barcode and QR code scanning to omit the manual labelling of stock numbers and the manual updating of inventory sheets. Most of them even include a convenient and portable label printing feature. Aside from that, they are also made easily integrate-able with many of today’s accounting and warehousing software which means errors are minimized if not eradicated and hours of data entry and uploading will be saved.
3. Enhanced Receipt and Shipment Monitoring
The automation of inventory processes already promotes an efficient approach to managing inventories but aside from that, an inventory management software can aid in other areas too like how it simplifies order receiving and shipment monitoring. With it, your inventory team will no longer need to look into the physical documents. All they’ll need to do is scan the product into the software and tag it received and then it will automatically show in your on-hand inventory repository. In the same manner, when you send out an order, you can easily scan them out of your inventory.
But here, the possibility of committing error still lies on the staff. Hence, make sure your staff are well trained not just in terms of using the software but also in double checking items before they are scanned in or out.
4. Significant Decrease of Shrinkage or Missing Stocks
Shrinkage or missing inventories are a part of reality which are usually caused by shoplifting, inside theft, vendor fraud or other administrative errors. As a matter of fact, statistics from a 2017 survey conducted by the National Retail Federation accounted at least 26% of shrinkage and that’s a lot of potential income if the management only deployed an efficient and strict inventory control measure. This is another critical issue an inventory management system can address. It provides a computerized inventory process that can easily spot imbalance between the virtual figures and the actual stocks. Its various automations will consequently bring a significant decrease of stock loss or shrinkage.
5. Streamlined Inventory Management
Using an inventory management software means you’ll have an easy access to inventory levels. You have three options in terms of its kind: desktop-based, mobile-based, and web-based. In just a few clicks, wherever you may be as long as you are connected to the web and you are using either a mobile inventory app or a web-based software, how it is giving a real time repository of inventories and sales will make you able to glance how your inventories are moving any time you want to. Many reputable inventory management software providers offer web-based software that is also mobile ready. Going for such type of software is like you’re paying for two products at a price of one.