As a business owner, you want to make sure your inventory is always at a reasonable level. That way, you don’t end up with piles of unsold goods clogging your cash flow.
This means you need a system that allows you to manage your stock from end to end. That means inventory, sales and invoicing, barcoding and reporting all in one place.
Inventory Management
Inventory management is a crucial part of business, regardless of size. It involves knowing exactly what items are in stock and how much is needed to fulfill orders and meet customer demands.
The best inventory management systems integrate with accounting software to ensure you have the right amount of working capital and know when to buy and sell products. They also help you manage vendors, customers and supply chain.
Managing your inventory can seem overwhelming at times, especially for growing businesses, but the benefits are clear: It saves money and reduces costs, improves cash flow and allows you to stock popular items that move quickly.
The key is to find a system that’s right for your business and that fits your budget. There are several different types of inventory management systems, from simple manual spreadsheets to sophisticated ERP (enterprise resource planning) or software as a service applications.
Order Management
Order management systems (OMS) are centralized platforms that oversee orders from multiple channels, including online and in-store. They can help businesses manage their sales processes and customer data from a single sign-on.
One of the most important features of an OMS is connectivity to other business systems such as CRM, finance management, and supply chain. This can lower manual input and save you time and money.
The best OMS will also give you the tools you need to track key performance indicators (KPIs). For example, tracking the cost of fulfillment like picking, packing and shipping can save you money.
In addition, many OMS platforms are client-facing, meaning customers can access their order history from the moment they place their order. This can eliminate unnecessary calls to your sales or customer service staff.
Inventory Control Reports
Inventory management is an important process for a variety of businesses. It helps ensure the right amount of inventory is available at the right time to meet demand and minimize cost.
A business's inventory system needs to be able to handle multiple sales channels, while delivering real-time inventory insights. Look for software that integrates with your point of sale (POS) to keep data synchronized and make it easy to track and report on inventory levels across all sales channels.
Successful small business inventory management depends on regular stock checks. These can be full audits of the entire warehouse once a year, or spot-checks on items with high sales volumes.
In addition to detecting loss and theft, regular audits can reveal errors in the tracking process. This can include mislabeling, incorrect placement, and out-of-date packaging.
Reorder Points
Managing stock is an important part of your business, as you need enough inventory to ensure that you can meet customer demand. Storing too much inventory is expensive, while storing too little can result in stockouts and delayed orders.
To avoid stockouts, you need to calculate reorder points for each of your products. Reorder points help reduce the cost of warehousing and keep your inventory levels within your budget.
Reorder points are calculated by calculating an item’s lead time, demand rate, and safety stock level. For example, a laptop retailer may have a reorder point of 500 units, if its average daily sales are 50 and the lead time is 10 days.
Reorder points are not a fixed number and may change as your business changes, especially during high or low season. Therefore, it is a good idea to update them regularly.