Four Reasons Why an Inventory Management System Makes Good Business Sense
In a product-based business it makes sense to keep a close eye on your inventory – after all, your inventory is one of your largest assets – if not your biggest. By not effectively monitoring your business’ inventory, you are exposing the business to the risk of inventory errors and inefficiencies. Inventory management software is designed with features to help you more accurately monitor and control your inventory and avoid these issues. Let’s look at just four of the most important reasons why implementing an inventory management system makes great business sense.
Any inventory management system will help your business to keep inventory at an approximate level – it’s just that modern, cloud-based systems are much better at it. While older inventory control methods often featured periodic manual stock counts, newer inventory management software allows for inventory levels to be updated in real-time as orders are dispatched. The practical application is that your business can carry the lowest level of inventory required, while still having confidence that the warehouse can handle customer orders. Less of a buffer is required on account of the greater precision in monitoring stock levels. Carrying a smaller inventory can free up money to spend elsewhere in the business – so can you really afford not to use a modern inventory management system?
Accurate inventory can help your business rapidly respond to customer concerns and avoid lost sales and lost customer confidence due to running out of stock. Real-time records provide your team with the ability to identify anomalies in order fulfilment, giving your business the chance to correct a shipping issue before it is even a problem experienced by the customer. Moreover, when your customers do make contact with questions about their order, your inventory and order fulfilment information is easily accessible in the cloud, meaning that you are able to provide informed advice. Improving your inventory management system can in turn enhance the customer experience, building trust in your business and its products.
Reduced Inventory Workload
Manually counting stock is a hassle for businesses with a large inventory – it takes up time, saps energy and costs the business money. Moreover, repeated stock handling or looking for missing product can create significant extra labour costs for a business. A good inventory management system allows a smaller number of people to control and monitor inventory orders and sales in real time, saving team members from having to carry out inventory recounts or go looking for a missing piece of inventory. Moreover, a good inventory management system uses tools such as barcode scanning or integration with accounting software to reduce manual processes right across the business’ inventory management function.
Proactive inventory management strengthens your business’ defences against stock shrinkage – that is, when inventory is lost between acquisition and the point of sale. If your business is keeping a close eye on inventory with a loss prevention focus, the few dishonest staff within an organisation may be disincentivised against taking product they’re not entitled to. Implementing an inventory system makes great business sense: Managing a leaner inventory, improving customer satisfaction and trust, reducing manual processes and keeping a closer watch on stock shrinkage.