Importance of Inventory Management System

 

inventory management system

A headache most entrepreneurs have to deal with in stock theft. With the millions lost every day in the retail and wholesale industry, it makes sense to monitor your stock. An inventory management system offers you this solution, but it also comes with more packs. Besides helping you keep track of where your assets are and what they’re worth, it analyzes your business’s inventory requirements and automates your ordering. If you want to enhance your operation and increase your profits, this post is meant for you. Find out why you need an inventory management system and how it will help your business.
1. The system helps with organization
An inventory management system keeps your business organized. Without tracking or managing your stock, it’s hard to know what you need, when you need it and in what quantity. A proper system provides you with detailed reports of every asset you have. You can see what is selling fast or and what’s not moving.
The system can be set to inform you when you are running low on inventory and also reorder them, so you are never out of stock. Having this data improves your business capability and allows you to make informed decisions about your needs. When choosing an inventory management system, this is the most vital aspect to remember.
2. A good inventory system improves tracking and transparency
Better stock tracking and transparency are some of the massive advantages of having an inventory management system. If your employees have itchy fingers, an inventory management system will stop them from stealing.
You will know where your assets are and what they are worth. The barcodes on the items allow you to track from the time hit your shop to when they are purchased. This makes it very hard for inventory to fall through the cracks or go missing.
With the constant monitoring of all your assets, you can see where the strengths and weaknesses of your business are. The system helps prevent you from ordering too much stock and get what you need. This reduces instances of stock staying in your warehouses too long, which affects your storage overhead.
3. It improves your relationship with vendors
With all the items being tracked, both you and the vendor are kept in the loop of your needs. The system can be set to automatically order certain items at specific intervals based on your ordering history. It also allows you to order deliveries in a more systematic and orderly way.
4. The system offers integration with other business systems
You can integrate your inventory management system with other software systems such as accounting or enterprise resource planning (ERP). This lets you understand the value of your stock, assist you with accounting and asset management. Point-of-sale (POS) and purchase order (PO) systems use to ring up purchases can also be linked to these inventory systems. The integration of these business systems streamlines the processes involved and allows for better organization.
5. Increases customer satisfaction
There is nothing worse than a customer walking into your store for an item only to find that it’s not available. Have this scenario a couple of times with the same customer, and you have lost them for life. With word-of-mouth being the best form of marketing, you can be sure they won’t be telling their friends to shop at your store.
A good system tells you when you are running low so you can restock. This helps you build a strong relationship with your customers and increases the referrals you get from them.
6. It saves you time and money
With improved performance and efficiency, you can save time and money. The automated tracking, reordering of stock, and report generation decrease inventory loss, write-offs and lowers inventory holding costs. This reduces your operation costs allowing you to plan accurately.
7. A good inventory system increases efficiency and productivity
Increased efficiency and productivity translate to more sales, shorter lead times, improved delivery performance, decreased instances of running out of stock and increased inventory turnover.
With a good inventory management system, your business is more organized and efficient, and you can meet your customers’ demands quickly as you have what they need at hand. The system allows you to plan ahead, predict what is likely to do well in your store, and saves you time and money. Not sure which inventory management system to use? Contact us for a free consultation.

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