When most people talk regarding inventory management, they usually link it with retail systems. Although retail operations rely too heavily on inventory control, an inventory management software is commonly used in a variety of businesses, from production to utilities, health care and education, schooling, government and much more. Inventory management software automates and centralizes the method of monitoring inventory flow as well as maintenance to make sure that the right supply of inventory is sufficient at the right time and is at the standard quality.
Inventory management – a necessary evil known to business owners. This fact is reputed to each and every manufacturing and warehousing sector. The purpose of this article would be to provide you an in-depth understanding about what inventory management software is, what it does, and why electronically managing inventory is immensely important for every kind of supply chain enterprise. It will also provide you with a clear grasp of certain essential features that an inventory management software should have.
Anyone operating a production and supply business understands that inventory is one of the company’s most critical revenue sources. A precise inventory evaluation will have a drastic impact on the sales and revenue and making a mistake could be unfavorable to the business.
“Out of stock” cases are always considered as a disappointment and sometimes it affects your earnings and credibility negatively in a lot of ways. Even if you are a small company or even a established business, managing a single retail site or numerous consignment outlets and distributors, inventory management helps in monitoring and regulating supplies and stocks, and helps manage your inventory and revenue.
Inventory Management: What is it?
Inventory control is part of running a supply chain. The Inventory management includes keeping track of stored products in a business. Accurate inventory and warehouse handling are indispensable in retail, manufacturing, distribution and all other industries in order to make sure that a company would have adequate supply at hand to meet consumer demands.
In a general sense it entails managing and coordinating with all of the different operations of a company to make informed decisions.
What is an Inventory Management Software?
Whenever inventories have not been properly and accurately handled, either of the two key things will occur – either a company will lose a lot of money with its potential sales or waste money storing unneeded goods.
An inventory management software is the one which handles the entire inventory process (from quotations to order fulfillment). It also keeps a record of the buyer, manufacturer, work orders, deliveries and other reports along the way, so that a business owner can keep track of what goods are being sold and how many.
Streamlining inventory management gives a strategic advantage for businesses since they can help predict trends and prepare accordingly. Inventory management software enables forecasting of potential demand and supply to help adjust shipping and deliveries and reduce over-and understocking-related costs.
Inventory management software tools also provide comprehensive output and valuation reports and details on the overall inventory. Here are some advantages of having an inventory management software for your business:
Benefits of Inventory Management Software
- Inventory management software monitors and keeps a record of all the inventories and shows a summarized overview of the stock in hand.
- Tracks cost and optimize performance by managing consumer preferences accordingly.
- Fast and simple reordering.
- A software for inventory management can be linked with a range of other software programs, which include accounting and ERP or Enterprise Resource Planning systems.
- Maintain stock visibility through system-generated reports with each store or warehouse location at any time.
- Projection of potential demand by evaluating data trends and stockpiling inventory.
Therefore, a great inventory management software should not only keep track of the number of inventories in hand, but should also be efficient enough to have quantifiable business insights, for instance: distinguishing low and high performing items and issuing reorder reminders whenever stock supplies are low.
Must-have features of a great Inventory Management Software
Accurate inventory tracking
It is also crucial that staff in control of inventory management know, in real time, what products are in stock and where they are stored in warehouses to help improve productivity, reduce the costs and streamline the process. Key to accurate inventory control is the most significant aspect of inventory management software systems.
An inventory management software must be able to provide a comprehensive real-time information with the key components for a supply chain management. This prevents you from getting stockouts, make automatic reorders and get instant alerts whenever sales are made.
Counting and inspecting inventories manually is stressful and susceptible to human error. If the inventory monitoring process is carried out manually, your business may run into irreversible problems.
The most popular method for counting inventories is the use of barcodes. Through incorporating barcode software into the inventory management software and acquiring widely available barcode scanners, businesses will be able to utilize this technology to improve precision, efficiency and dramatically reduce costs.
Inventory management will benefit greatly with the integration of barcode scanning tools. This optimizes the entire process of inventory monitoring, stock-taking and stock management, making it so much more efficient. Companies can serialize products or asset tags automatically, thus, simplifying tracking.
Quotation, Purchase, Shipment and Order fulfillment
Purchasing decisions handled by a business directly affects how accurately the inventory levels are monitored or regulated. Inventory management software guarantees that stocks are automatically updated whenever a purchase order is placed. The software must make it very easy to create POs with all the required supplier details.
It must also be able to generate POs automatically when products are low in stock, submit partial orders and monitor back-orders, track the POs from beginning to end, and label Purchase Order as partially received.
CRM (Customer Relationship Manager)
A CRM enables a business owner to securely store customer information regarding record purchase history and his or her preference to forecast probable behaviour.
Comprehensive inventory reports
An inventory management software must have metrics that can provide an in-depth look and evaluation of how an inventory is performing over the time.