Managing inventory is important if you’re looking to identify problems before they start. You can ensure you never miss a sales opportunity, minimize costs to maximize profits, and conduct accurate trend analysis. Here are some tips for improving your inventory management:
- Don’t miss sales due to out-of stock items
Keeping track of inventory is vital for success. Using an accurate stock report will help you monitor which items are running low and selling fast. As a result, you can plan for max profits.
- Don’t waste cash in overstocked inventory
When running a business, it is important to spend your money wisely. You need to buy only what you need of any item in order to sell as much as you can without running out. Items that are stored on the shelf and cannot be sold are a waste of space and money.
- Improve the accuracy of your accounting and profit reporting
Everything you buy has an asset value and will appear on your Balance Sheet. Accounting will be easy if you are managing your inventory. It is very important to ensure stock is accurate in order to confirm profit reporting.
- Identify issues before they get out of control
If you monitor inventory levels, you will notice issues as soon as they happen. If you do not, you may not notice issues until annual stock take, at which point you may have lost money.
- Customer service
Customers sometimes do not receive all of the items they ordered. Having a system will help you to easily check your data and confirm what they are looking for. Find and communicating early with customers will allow them to trust your ability as a merchant. This is very important with high competition levels!
- Efficient re-ordering
With an inventory system in place, your ordering process will be easier and more reliable. Itwill not require you to take physical inventory at storage locations on a regular basis.
- Minimize theft and losses
If you consistently manage your inventory, there is a lower chance of theft. This also helps you monitor damaged and lost goods.
- Trust in your information systems
If your staff knows that the stock levels in your system are always up-to-date and accurate, they will be able to trust the software. This will lead to better data for more accurate reporting, better collaboration, and greater efficiency across the team.
- Minimize warehouse costs
Knowing where things are in your warehouse will make picking, packing, and shipping more efficient. You will be able to process more orders in the same amount of time with the same staff.
- Efficient stock take and end-of-year process
If all your inventory levels are up to date all the time, a periodic stock take will be faster and more efficient. Instead of a time consuming data entry task, you can just confirm your levels.
You can’t maximize profits without knowing how much you have at any given time, how much you’ve received, how much to pay suppliers, if there’s enough orders to fill, and when to order more. An inventory management system will provide you with the help you need to overcome these tasks in both a cost-effective and time-efficient manner.
