Well, how do you manage to take care of your inventory? The number of product lines and its quantity can differ greatly between different businesses. While business market only 5 to 10 products while other businesses have thousands of product lines. Irrespective of the number of products, the procedure to safeguard and manage inventory is similar. The size and volume only matter when you have inefficient inventory management systems and hence your problem gets compounded.
But how does inventory management take place in actual?
Stage 1: Inventory is ordered
This is done on the basis of the consumer demand. You do not have a perfect customer demand estimate. So, you order stock which you expect your customers to buy in the coming weeks or month. It appears to be simple but in reality entrepreneurs spend hours on it. The ordering task is most complicated as a single wrong order can cost you a big amount of money.
But how does inventory management software makes it accurate and effective?
- A good system has the ability to set lowest stock level and then re-order similar stock amount. It showcases the user what stock needs re-order and you can quickly calculate and make your purchase order.
- It also helps you see what stock is needed for sales order which you presently do not have in stock.
These are two abilities which you should look out for in inventory management software from a purchase viewpoint.
Stage 2: Get the stock
It is an easy process to receive the stock. However, you need an inventory system to ensure every crate, box, carton or pallet is well-checked against the purchase order so you know you have got all you have received. Remember your system is as efficient as your staff or you.
Stage 3: Dispatch of the orders
Products need to be sold have to scanned to assure right movement of the inventory. If you aren’t selling it to the customers directly, then you need to maintain the procedure to handle the orders and make sure all the orders are discharged efficiently.
Stage 4: Returns from suppliers and customers
You get all the faulty stock from your customers which you track and send it to the supplier. If you have a good inventory system, it will help you mark not just the return of the stock but get a refund or credit note too.
Stage 5: Stock report and product price
It is important that you rapidly get the reports of what and where the stock is moving, which lot is not selling and which lot is making a lot of money for you. It will help you manage the stock levels. A good inventory management system should possess the skill the change prices through incoming good screen so that you know what prices you’re paying for a particular product and then adjust it to maintain the margin levels.
So, all in all, simple inventory management software ensures that you have all the tools to handle the above stages. It is essential that you find the right system with perfect tools and functioning which saves you from extra labor, time and ensures that you control the stock levels and expenditure along with margin levels.