Top Reasons Your Business Needs an Inventory Management System

Summary: Efficiently manage your inventory using inventory management system along with multiple sales channels, items, and warehouses. Further, it will help you boost employee productivity, reduce product wastage, offer better customer experience, and increase overall profits.

A business tries its best to effectively manage inventory, but as the SKUs, sales, and warehouse locations increase, inventory management gets more complicated. As a result, businesses are not able to meet the customer order demand on time, and often fall short on inventory.

All of this can be avoided by implementing inventory management system that will give you real time insights on inventory levels, help you forecast reorders, reduce business costs, and do a lot more.

Still confused if you should invest in inventory management system or not?

Check out a few reasons why a business should implement inventory system and see if you identify with these.

Reasons Why Your Business Need Inventory Management system

Minimizing wastage, effective inventory tracking, wanting to add more sales channels, improving customer service, controlling costs, etc., are some of the main reasons why your business might need the inventory management system. Moreover, if your business is also looking to efficiently manage reordering and multiple stores and warehouses, you should consider investing in an inventory system.

• Efficient Inventory Tracking

Inventory tracking is one of the prime reasons why you should consider implementing inventory management system in your organization. Not being able to track the exact status of your products leads to delayed deliveries, lost/ misplaced inventory, unsatisfied customers, and other issues. In fact, even when businesses try to track inventory manually using spreadsheets, it only results in increased human errors.

The tracking module helps you to trace where and how your products are moving in the order cycle. Users can track products across all order stages, including production, movement to warehouses, order dispatching, and final delivery. Further, to facilitate accurate inventory tracking users can assign dedicated product serial numbers or even use barcoding to tag products.

• Minimize Wastage

While dealing with tons of products, it is difficult for warehouse/ retail managers to track which products are damaged, expired, or reaching the expiry date.

The reporting tool of the system can generate reports and provide you with a list of products that are about to expire or have already expired. In addition to this, these reports can also be used to identify the sales trends and products that are no longer in demand.

• Add New Sales Channels

If you are looking to expand and add new sales channels, inventory management system is a must. These new channels can include anything like an eCommerce platform, D2C platform, or even a B2B sales channel. But managing inventory on all these platforms will be tricky, unless you centralize all the inventory related information on a central platform. The software’s features like real time inventory forecasting and syncing help you with the exact inventory status.

• Manage Reordering Efficiently

The system displays accurate inventory levels for all the items, which helps you identify which of them are selling fast, and you need to refill them. Along with this, you can also set minimum inventory level alerts in the system, that will send you an alert through notification or email that a particular item has reached a minimum level, and it’s time to restock.

Other than this, another way of managing reorders is to generate automated reports to analyze sale trends and identify your best-selling products for reordering

Suggested Read: Understanding the Role of Software in Inventory Management

• Overcome Any Communication Barrier

Using an inventory management system will reduce all your major communication related problems across multiple departments, warehouses, customers, etc. For instance, the system sends alerts whenever a new order is received. And as soon as it is dispatched from the warehouse, the number of items is reduced from the inventory list in real time. And if the item is about to reach the minimum inventory level, it will give you an alert and you can place reorders as required to fulfill the demand.

• Boost Productivity

Employee productivity is another major reason why businesses majorly invest in inventory management system. Using the system will not only minimize human errors but also speed up routine work that was done manually through task automation. For instance, your workers don’t need to manually adjust the inventory count with every purchase and sale, it can be easily automated, thus saving a lot of time.

• Cost Control

An inventory management system helps organizations to control costs by preventing overstock situations. Using the system, businesses can accurately forecast product demand and know the exact inventory levels. In fact, preventing unnecessary restocking also saves up the warehouse cost, and businesses can rent or lease only the required space for stocking.

In addition to this, the system enables businesses to control other costs like unjustified employee wages, transportation, backorders, and more.

• Efficiently Manage Multiple Warehouses & Stores

Managing multiple warehouses to ensure that all have the required number of inventories can be a big hassle when done manually, especially if you are dealing in multiple SKUs. While operating from one warehouse, managers cannot have accurate information of inventory levels by just working on spreadsheets.

So, switching to inventory management system is the only way out. The inventory system will allow you to monitor all the warehouses through a bird’s eye view. Managers can keep a check on the end-to-end supply chain to know the inventory levels and movement of items among multiple warehouses. So, when one warehouse is running low on a certain product, instead of reordering, the shortage can be fulfilled from another warehouse.

Suggested Read: How Does Inventory Management Help with Stock Controls?

Conclusion

While selecting one, make sure that the inventory management system aligns with your business requirements. It should also scale easily when it comes to adding more inventory items, reporting options, sales channels, and other expansion options.

Related Categories: Inventory Management Software | Inventory Control Software | Delivery Management Software | Warehouse Management Software