The Definitive Inventory Management Software Guide
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Inventory is one of the most important aspects of the supply chain – in fact, the way you handle your inventory makes or breaks your business. This is exactly why inventory management deserves a lot of focus from your end, as dedicating yourself to your inventory management processes can help you refine the rest of your business operations as well.
Back in the day, inventory management was a long, tedious job that involved tiresome record-keeping and heaps of documents. However, today, thanks to the advent of inventory management software’s; the process is not only easier to execute but also considerably more effective.
The right tools and technology can really help you move forward as a business, regardless of what the nature or the size of your business is. This is why integrating an inventory management software is absolutely crucial if you want to ensure that your venture grows exponentially, and that too without any restrictions.
If you are not familiar with inventory management and don’t really know what to do in order to handle your stock properly – this guide will help you!
Although our ultimate aim with this guide is to help you understand what an inventory management software is and how it can help you improve your business operations, we can only do that if you have a strong grasp on the fundamentals of inventory management.
Therefore, in this section, we will focus on what inventory management is, why it is important, and some very effective inventory management techniques that you need to know in order to make sense of the functionality of an inventory management software.
Whether you are a retailer, a manufacturer, or an eCommerce vendor; your business is defined by the way you handle your stock. Some businesses fail to understand this. This is because before the stock is actually sold and accounted for in your revenue, it is a non capitalised asset. What this essentially means is that until it is sent out to the customer, it is not bringing in an active income. This, unfortunately, leads to businesses neglecting a very important aspect of the business: inventory management.
At the very basic level, inventory management is the handling of stock when it is in storage. In that regard, it is linked with warehouse control and management and involves refining the storage process of all the products your businesses are engaged with. Inventory management is all about keeping track of your products, implementing high quality control, and forecasting your sales in accordance with the stock you have on hand.
Now, many businesses think that they can do all of this with the help of a spreadsheet – yet, thinking that, especially in the 21st century, is nothing short of unwise! All of this needs to be done quickly, preferably in seconds. And it might sound impossible, but it isn’t if you employ a good inventory management software.
But more of that later.
As a business, you have the responsibility to ensure that your inventory management is up to par. However, the only way to do that is not understand what kind of inventory you work with as a business. Let’s have a look at some prominent types of inventory – identifying the one that your business has will help you understand this discussion a lot better.
As the name suggests, this type of inventory is mostly at use in manufacturing businesses, where the manufacturing process requires the storage of multiple components that will go in the making of the product. So, raw materials are the materials that go into making the finished product for a manufacturer.
For example, if you are a car manufacturer, all the little spare parts that go into the making of your car are its raw materials, and there is usually a completely separate inventory for this. Separating this kind of stock from, for example, finished products, makes it easier for you to compartmentalise different segments of the process, as well as improve the overall organisation of the storage space in your warehouse.
This kind of inventory also has more to do with manufacturing businesses. It refers to items that are past their raw material stage, but are not quite finished yet. These products are in-production, and are hence not ready for sale just yet.
Let’s say you are a furniture business. For you, the WIP inventory might consist of products that have been assembled, but have yet to be painted and packaged. Needless to say, these will have a separate inventory and hence are a different inventory type.
Finished good inventory consists of goods that are ready for sale. Whether they are products that you have manufactured yourself or products that you got from a supplier depends on the nature of your business. What’s important is that these products are ready to be shipped as soon as you get an order.
For many retailers, finished goods are the only kind of inventory that needs to be dealt with considering that retailers usually purchase whole, finished products from a supplier. This means that they don’t have to worry about the other types of inventory mentioned on this list, so keep that in mind if you are a retailer.
Again, this kind of inventory may only be pertinent if you are a manufacturer, because for the most part, it involves dealing with the goods that help you deal with any possible defects or discrepancies that you might encounter during the manufacturing process of your products. So, very commonly, an MRO inventory will include things like machinery, spare parts, batteries. However, it may also include other things such as safety equipment, cleaning supplies, repair tools, and computer systems.
It’s obvious that not all of these items become a direct part of the product you are selling, so a lot of businesses don’t consider MRO a valid type of inventory. However, considering that these items are also quite important and will ultimately help you make your product fit for sale, it is better if you keep a track of these as well. Especially if these items are being purchased by a supplier, they must reflect in financial records as well which, more or less, makes the MRO goods inventory valid.
Regardless of the nature of your business, each product you send out has to be properly packaged; both in terms of presentation and in terms of protection. For this reason, packing materials entail a whole separate inventory, and you must pay attention to it since the way you pack your product can have a direct impact on the fulfilment of the order.
For example, if you are shipping the customer a fragile product, you must ensure that it is secured in bubble wrap and padding. Not only that, but each order you send out must be in a box that corresponds with its size, as well as packing chips and other important material.
So, packing materials are important. It is not uncommon for businesses to not focus on the packaging of their products, but this is not a smart move. What if your product is ready to be shipped in itself, but you just realise you are out of the right boxes or bubble wrap? It would be disastrous, which is exactly why packing materials are an important type of inventory.
The next important topic for us is types of inventory management itself. This is closely connected to the techniques you employ for inventory management. There are many different techniques of inventory management that can be used by a business – ranging from something as simple as maintaining a spreadsheet to something as tedious as actually physically counting stock and inventory.
To help you pick the best inventory management technique and execute inventory optimization we have compiled a list of 10 of the top most important inventory management techniques.
1. Cycle Counts
Ask any business owner what the most important part of inventory management is, and they’re likely to say the cycle counts.
Essentially, the cycle count is a procedure that requires you to break your inventory down into smaller, specific lists of products. These products are then counted, and that’s how inventory is ultimately managed if you are employing this method.
When it comes to the actual lists, these can be based on different aspects. For example, you could divide your products through product category, product vendor, warehouse location, or any other aspect that you deem reasonable.
Yet, the two main types of cycle count that you should definitely incorporate in your business are:
High risk count includes a list of all the products that are prone to various inventory management discrepancies, for example shrinkage problems like theft and spoilage, as well as the amount of repairs needed. As you can probably assume, this kind of a cycle count is done so that you have an overview of your most problematic products, can pay more attention to them and ideally identify the reason behind so many write-offs.
High value count is a list of the products that are the most valuable, and also likely to be sold the most. So, think of your best-sellers and the products that require the greatest spending but also bring in the greatest revenue. Needless to say, these products are high-priority and incorporating this count in your overall inventory management technique can help you keep an eye on them and their progress at all times.
Another inventory management technique is inventory valuation. Usually, there are three calculations that you can do in this regard: FIFO (first in, first out), LIFO (last in, last out), and AVCO (average cost/weighted cost).
The inventory valuation method that fits your business the best depends primarily on the nature of your operations. However, it is very important to choose the right one as only the right valuation method can help you have a significant impact on your overall profitability.
Yet, the only reason we are focusing on FIFO in this guide is because it is arguably the most effective valuation method. It focuses on getting those products first that you have purchased/produced first. This is quite a convenient way of organising your inventory and warehouse since you are making sure you get the stock you already have off your hands before you place any new orders.
ABC analysis is an inventory management technique that is primarily focused on prioritising your attention, and making sure that you spend the majority of your resources on the products that are likely to bring in more revenue.
Based on the Parento principle, only 20% of your total items give you 80% of your consumption. This means that when it comes down to it, the most of your energy and resources should be directed towards the 20% that is likely to be consumed and bring income to your business.
This is where the ABC analysis and inventory management technique comes in! Using this method, you can divide your inventory into three different groups: A, B, and C. A will include items that are high in value and small in number. B will consist of items that are moderate in value and also moderate in number, whereas C will only consist of items that are small in value, and large in number.
This type of organisation of your stock means that you can easily focus on category A and ensure that most of your inventory management tactics target that group. This doesn’t mean that groups B and C don’t deserve attention – it just is a better way of dividing your resources for more effective management solutions.
Just-in-Time, more commonly known as JIT, is a very popular inventory management technique, and many businesses use it. However, there is a certain level of risk involved when it comes to JIT, which you should certainly be aware of before you decide to opt for it.
As the name suggests, JIT is an inventory management technique that involves you receiving goods just before they need to be sold. It also involves getting only as many goods as needed – which means that you get your stock after you have received orders.
Now, it might sound risky, and it is. What if you don’t manage to organise everything just in time? What if your supplier doesn’t have the products you need anymore? All of these are pertinent questions – yet, many businesses are willing to take this risk because JIT is very effective in terms of saving time, money and efforts.
Especially when it comes to small businesses, JIT is a good option because it takes out the need for a better cash flow, monetary capital, or warehouse space. If you are running low on any of those things, JIT can help ensure that you are not wasting unnecessary resources on products that you won’t even be able to sell at the end of the day!
What’s even better is that the problems associated with JIT can be easily countered if you have a functional, trustworthy relationship with your suppliers. Your suppliers can have a good idea of what your usual orders are and have them prepared even before you formalise your purchase. Similarly, when you understand how your supplier works you can anticipate the purchase process beforehand and avoid disappointing your customers.
Another inventory management technique that can prove to be beneficial for you involves dead stock and surplus inventory:
Dead stock/dead inventory is related to the products that are never sold or used by customers. So, the obsolete products in your inventory as well as the products that customers don’t order often due to issues with functionality or any other reason are a part of the dead inventory. Many businesses don’t care about these, and they are left lying in the inventory for years to come.
However, if you choose to not do anything with these items, you are putting yourself up for loss. If you focus on dead stock and actually brainstorm a few ways you can get rid of it in a way that still incurs benefit for you, you can manage to make it an active part of your revenue!
For example, one way you can get rid of your dead stock is by including it in discount bundles and pairing it up with your bestsellers. This way, you can still manage to get some ROI out of these products, which seems to be the only smart way to get rid of dead-stock.
Surplus inventory is all the stock you have in excess of what you need. Ideally, you should avoid ordering surplus inventory because it is just extra baggage. But just in case you actually do end up having more stock than needed, you can use it as safety stock. If that isn’t possible, then getting rid of it with your dead inventory is also a good option i.e. discount bundles.
The formal term for discount bundles is cross-merchandising. Essentially, it is a visual marketing and merchandising strategy that puts products from different categories together, which helps you encourage the purchase of said products with each other.
Another way to get dead stock and surplus inventory of your hands would be donating. Although this won’t incur any direct benefits to your business in terms of finances – however, it is a very good practice to adopt as a business and you will always find organisations that can help you establish a regular practice of donating stuff you don’t really need in your inventory anymore. Also, companies that engage in regular donations receive great tax benefits, so that’s another plus point.
Many businesses believe that setting a minimum quantity for the stock of each product is very effective, and can help you manage your inventory a lot better. The minimum quantity is called a “par level” and the way this inventory management technique works is that as soon as a product reaches the par level, you need to reorder the product.
The main advantage of setting a par level is that it helps you streamline your purchase processes and create a better structure out of your inventory. Setting par levels for each product also helps you keep up with the overall demand of the product and make sure that you are not letting your customers down.
Contingency planning can also be implemented as an efficient inventory management technique. This is because no matter what your business is, the way you react to change can have an impact on your operations, as well as your customer’s perception of you.
For this reason, it is important to have a certain level of contingency involved in your planning for the future. A good place to start is any scenarios that you can think of which will have an impact on your sales. For example, what if your supplier tells you they are discontinuing your bestseller range – how do you respond to this?
It may sound far-fetched at first, but contingency plans can help you prepare for the worst and also ensure that you have any crisis management tools you need ready and in place if you really have to encounter any difficulties. It will save you from future loss and hence is a crucial inventory management practice that you can benefit from.
Some businesses send their products to other retailers, who then store these products and sell them on behalf of the original business. Each business has a share of the profits. This is increasingly becoming more common between businesses, especially since omnichannel selling has been on the rise.
If you focus on your consignment inventory, you can also work with this business model which will help you make extra money. All you need to ensure is that you are following the right blueprint for inventory management – that the right inventory levels are being communicated and at the right time, and that all businesses involved have a considerable level of transparency between them.
Dropshipping is not only a really popular business model, it can also be considered as an inventory management technique. Just like the JIT approach to inventory accuracy, dropshipping also works to minimise the risk of inventory replenishment.
Dropshipping essentially means that you, as a business, get orders but instead of fulfilling these orders on your own, you forward these as a request to your vendor or manufacturer. The vendor or manufacturer is then in charge of the order, which means that they will send the items directly to your customers instead of involving you in the equation. Since this is technically done on your behalf, the products will have your branding and most of the time, the customer wouldn’t even know that dropshipping is what is happening behind the scenes.
Dropshipping can help you cut costs on inventory – since you are not physically storing your products, you don’t have to worry about warehouse management and the optimization of your storage space. In addition, this also means that your asset management as a whole is minimised to a great extent and essentially, you aren’t responsible for the stock at all.
Another important technique for inventory management (and something that an inventory management software can really help you with) is KPI analysis. KPI, as you may know, stands for Key Performance Indicator – so setting various KPIs can help you monitor your progress across different areas of inventory management.
KPI analysis can help you spot the problem areas in your operation, and hence help you focus your efforts and resources on areas that need it the most.
Ideally, you should set the following KPIs:
Needless to say, tracking your progress across all these aspects might be somewhat impossible. Therefore, the best thing you can do is identify the areas you are lacking in, and then pick a few KPIs pertinent to that area.
For example, if you notice a drop in your sales and figure out it has something to do with the way you handle your inventory, you can simply set a few KPIs in this area to monitor your inventory accuracy and inventory, which will help you get to the root of your problem.
Each of these inventory management techniques is built to cater to a completely different and distinct set of needs, which means that deciding which one is the best for your business will depend on what your requirements as a business are. Therefore, when choosing which one of these techniques should be implemented in your inventory management strategy, you should make sure it aligns with the ultimate goals of your business.
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Inventory management is a core process when it comes to maintaining and streamlining the supply chain. But that’s just important on a very basic level. In actuality, and when you look deep enough into it, inventory management can equip any business with a plethora of benefits.
Any business’s worst fear is running out of stock and not being able to meet the customer’s demands. Unfortunately, if you neglect your inventory optimization, stockouts will be a lot more common and you will definitely have to deal with more than a few missed sales.
With an effective inventory management software in place, you can easily make sure that you never run out of stock again. It can help you see what products you are running low on, compare your inventory level with your best-selling items, and place reorders before you run out of the important products. As mentioned earlier, you can set par levels of each product with the help of a good inventory management software, and this will help you ensure that you are always stocked up on your best sellers.
One of the most prominent benefits of inventory management is that it helps businesses save money. Effective inventory management means that you are relying on an inventory management software and other inventory software as opposed to manual labour for inventory and warehouse management, which means that you can reduce those costs.
It also means that there are less errors and discrepancies in your inventory management processes, which makes it even easier to cut your losses and make sure you are not wasting your money.
However, another way inventory management helps you with finances is as an investment. With effective inventory management, you can get accurate, up-to-date reports on each product. This will help you not only purchase/produce only as much as you need, but also only invest your money on the products that are likely to make a tangible contribution to your revenue.
As you can probably gather, accuracy is a pretty big deal if you are looking to improve your operations. When you have a strong system of inventory management in place, it becomes more realistic for you to gather accurate data on each of your products.
More accuracy means that you will only be making decisions that turn out to be beneficial for you. For example, an accurate report will help you identify slow moving products, dead-stock, and other assets that have your costs tied up. Getting to know these problem areas means that you can then concentrate your attention and resources in this direction, instead of wasting it elsewhere, where it’s not needed.
The ultimate goal for any business is to improve customer satisfaction – after all, only happy customers can help you elevate yourself in terms of success. However, without adequate inventory management tactics in place, it would be hard if not impossible to create a customer experience that sits well with your clients.
Since inventory management helps you bring more accuracy to the table along with smarter, data-backed business decisions, it helps you provide considerably better customer service.
So, think of it this way: a customer comes across your website and is particularly impressed by your best selling product; i.e. a vegetable cutting board. They place their order – not only that, they even ask a few friends to place an order for the board since it is exactly what they had needed! However, once you receive the order, you realise that the boards are out of stock. Now you have to call the customer and break the news to them, leading to not only disappointment of one person but a bunch of people.
For the same situation, if you have an inventory management software in place, you wouldn’t have to face the stockout in the first place, let alone facing the embarrassment of selling a product you don’t even have in the first place!
Let’s look at another situation. Your customer goes to a brick-and-mortar store of yours, and asks them for a specific kind of jacket you’re selling; say, a blue puffer. Your customer representatives realise that they are out of stock for that particular product, so they try to engage the customer in an alternative for the jacket. However, your customer is insistent – they want a blue puffer jacket and nothing else. They are even willing to drive to another store location for it!
With an inventory management software, it would be easier to provide a better customer experience in this particular situation. Since effective inventory management means that all your data on inventory activity is centralised, it means that your representatives can guide your customers a lot better. So, in this situation, the representative would be able to tell exactly which branch of your store has the jacket available, and the customer will leave the premises happy and satisfied with the help!
These situations might sound far-fetched, but they are very commonplace in today’s consumer environment. Your customers have a lot of expectations from you, and they expect these expectations to be fulfilled. Inventory management is one way you can ensure that you are providing the customer with your best, and trust us, that really does pay off!
No matter the size of your establishment, almost every business is prone to shrinkage problems. Shrinkage refers to your product count “shrinking” without you actually being able to sell it. So, issues like theft, damage, and defects all come under this. You can lose your products in many different ways, and that can truly be a problem – but not if you have an inventory management software in place.
Since inventory management enables you to get a 360 degrees view of your inventory activity, you can keep an eye on everything that is going on in your warehouse, and even your physical stores if you have any. Due to you being in access to information on each and every product, it becomes harder for shrinkage problems to manifest into deeper issues.
In the beginning of this guide, we mentioned that inventory management and warehouse management are inherently linked, so focusing on one of them means that you are making improvements to the other one as well.
Good inventory management can help you streamline your warehouse operations and make order fulfilment an overall positive experience for everyone involved. In essence, a good inventory management software will also be a warehouse inventory system. Thanks to an inventory report, you can have all the pertinent information you need for your stock, which means that your warehouse staff doesn’t have to cross oceans to make sure everything is in perfect condition and that nothing is missing.
This means that their efforts can be used elsewhere, and you can save money on extra work. This also means that you can process all your orders a lot quicker, balance your resources, and make sure that you are not lacking in other areas within the warehouse.
Usually, warehouse management, warehouse control, and inventory management are considered the main tenets of optimising your operations and making sure that the supply chain is free from any discrepancies. With a good inventory management software in place, you’ll not only have successfully dealt with one of these tenets, but you’ll also be on your way to transform the other two tenets i.e. warehouse management and control in the best way possible. This is why you should invest in a warehouse inventory management software, but more of that later.
Peak seasons sound like a dream, right? However, they can quickly turn into a nightmare without adequate inventory management.
During the festive season and flash sale events or due to unexpected spikes for one reason or the other, you, as a business, are likely to get an unbelievably high volume of sales. And while this is exactly what most businesses crave, it can be very hard to deal with.
However, if you have an inventory management software in place and your inventory management processes are on track overall, it is not impossible to meet the influx of demands and orders you are getting. With the help of good inventory management tools and techniques, you can keep your sales flowing across all channels!
The key to this is ensuring that your numbers are accurate since day one. Although this may be hard to achieve if your inventory management method merely comprises a spreadsheet, but with an inventory management software this will be the case either way.
These benefits should help you get an idea of why it is important to look into inventory management and invest in ways that can improve the way you handle your stock. As we discussed above, the customers in the 21st century are used to having their demands met at the speed of lightning, and unless you can keep up with that, succeeding in the market can be a long shot.
However, we also understand that establishing inventory management processes that not only align with your business, but are also effective in terms of making a positive contribution to your revenue can seem overwhelming – especially if you are a small business.
But it doesn’t have to be! An inventory management software can make the task of setting up an effective inventory management process as easy as pie.
Now that you have a good understanding of what inventory management is, it will be easier to understand what an inventory management software is.
An inventory management software is a tool that helps you organise all the elements of inventory management, and create a centralised experience out of it. Essentially, it can be defined as the process that brings everything together and keeps it that way! Whether it is tracking goods or streamlining the supply chain, an inventory management software will help you be on top of all the important inventory management related processes.
When it comes to inventory management systems, there are many options and solutions available in the market that help you implement inventory optimization. Deciding which one works the best for you requires an insight into what you need as a company. We will get into that later, but generally, there are 3 types of inventory management softwares: manual inventory management software, periodic inventory management software, and perpetual inventory management software.
However, periodic and manual inventory management systems are very similar and hence, can be perceived interchangeably. Hence, we will be focusing only on periodic and perpetual inventory management software’s.
Periodic inventory management softwares are essentially what we can regard as old fashioned inventory. Mainly because periodic inventory management is dependent on taking physical counts of your stock. Implementing a periodic inventory management software basically means that you are counting your stock consistently but at long intervals. It will also conclude by calculating the financial value of this stock.
Perpetual inventory management softwares are systems that help you track your inventory activity as well as other assets across the supply chain in real time. So, this is an automated system that updates every time you make a sale, or lose an item, or deliver something, and hence gives you a wholly accurate account of your stock levels and other relevant factors. Needless to say, a perpetual inventory management software takes priority over a perpetual inventory management software – simply because it is automated and hence offers more convenience.
Some main types of perpetual inventory management softwares include: manual/low tech inventory management, dedicated inventory management software, and integrated retail operations solutions.
Now that we are done with inventory management software examples, let’s look at why such a system is important to begin with. The list of benefits associated with inventory management that we discussed in section 1 can only be achieved by the help of an inventory management software, and that too a perpetual inventory system.
An inventory management software helps you maintain accuracy and make data-based decisions for all aspects of your business. Investing in such a system does not only mean that you are making a good choice for your inventory, but it also means that you can improve all the other elements that go into improving your business.
What’s even better is that an inventory management software can help you streamline multichannel marketing. In the 21st century, it is not uncommon for sellers to expand across different platforms and deal with customers from multiple selling channels. Even if you are not currently interested in this business model, as you grow and upscaling your business becomes a more realistic endeavour for you, you will realise that multichannel selling is a great option.
Yet, the only way you can achieve success on multiple platforms is if you focus on inventory control. If you resort to traditional methods, it is unlikely that you will be able to deal with multichannel inventory management since it involves a plethora of factors that need constant surveillance. However, if you use an inventory management software, it can be pretty easy to manage everything, and that too in considerably less time.
Other than that, since a perpetual inventory management software helps you equip your warehouse and inventory with end-to-end automation, it can also help you minimise some operational inventory management issues such as overstocking, understocking, and knock-on impacts. All of these, if not dealt with on time, can lead to losses. Even worse, these issues can impact your brand reputation and discourage customers from engaging with you on any level. So, warehouse inventory management software. A warehouse inventory management software will help you amalgamate your warehouse with your inventory, and equip both of them with efficiency.
What is cloud based inventory management software? Essentially, cloud based inventory management refers to the kind of system that is not-device oriented. In saying that, we mean that using a cloud based inventory management system, you can easily access your data remotely as well. Not only that, but cloud based technology also helps you track your inventory in real time, and provides you with instant updates.
With cloud based technology, all it takes for you to manage hundreds of inventory processes is a one-click login. One click, and you have reports, history, and all other records available to access. Surely, this sort of efficiency is something that all businesses yearn for and hence, an integral part of any organisation. The efficiency is also one of the biggest factors that makes cloud based inventory management a better option than manual inventory.
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Our inventory management cloud based software is cost-friendly. Not only does our software activate straight out of the box, but you also don’t have to pay for anything other than the charges per individual. In actuality, this is a budget-friendly package, giving a refreshing alternative to the time-consuming and expensive set up of on-premises software.
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If you’re looking to increase those profit margins, Canary7’s 3PL cloud based inventory management software is the best possible option.
Unlike traditional, on-site software, Canary7 is focused on keeping your data safe no matter what happens. In case misfortune strikes, you get to rest assured that your valuable information is forever safe in the Cloud.
For 3PLs, this is a very important factor since it allows you to be answerable to your clients and their customers in a considerably more responsible manner. Build your reputation and prove to your clients that you are capable of tackling not only your challenges and problems, but also theirs.
Using cloud-based technology means that you will always have a back up, so your data on our cloud based inventory management software is not as vulnerable as it would be if you were to rely on an on-site system. So, keep your data safe forever and choose Canary7 as your go to option for all your software solutions.
Just because an inventory management system is based on cloud technology doesn’t mean it has to be so complicated and technical to understand that you can’t make use of it on a daily basis. In fact, one of the most prominent distinguishing factors of a cloud-based inventory management system is the very fact that it is easier to use, and doesn’t require you to cross miles in order to make sure that you are employing it in a way that actually leads to an effective change to your inventory.
Ideally, a cloud based inventory management system would be quite easy and straightforward to use by you and the rest of your staff. Good inventory management solutions always come equipped with extra help such as user guides which make the other features even more accessible for you whenever you like. If you have a small set up, then look for a cloud based inventory management system for a small business that is not too complicated to understand.
As we have discussed multiple times in this guide the whole point of an inventory management software software is that you get to stay on top of your inventory processes throughout. You can only do this if your inventory management software provides real time updates. Therefore, look for a system that notifies you of stock levels repeatedly so that you know exactly when to engage in inventory replenishment.
Ideally, you should look for a system that supports RFID technology. However, at the very least, you need an inventory management software with barcode scanner. . This is because a huge part of inventory management is knowing exactly where your products are at any given time. A software solution that allows you to integrate barcode scanning with inventory management allows you to stay in touch with your stock at all times. An inventory management software with barcode scanner can really help you improve your inventory solutions.
The last thing you want your business to be is a shot in the dark. What you should be doing is making data-backed predictions, forecasts, and decisions. This can only be done if your system allows you to collect data which can then be used to create comprehensive, insightful reports. These reports will help you understand your business on a deeper level and make improvements in other areas of your business as well. Therefore, how well a system supports planning, forecasting, and reporting should definitely be taken into account before you invest in it.
We have already discussed that one of the elements that makes an inventory management software such a necessity to have is the fact that it can help businesses shift to a multichannel selling business model. However, not all systems will help you expand your one-dimensional venture into a full-fledged business, which is why it is important to look for an inventory management software that helps you get your items to customers through multiple channels which may include third party sellers such as eBay, Amazon, and AliBaba.
By now, you know that warehouse management and inventory control are both a part of the same equation. Therefore, it is wise to look for an inventory management software that helps you improve not only your inventory management solutions, but also your warehouse management processes. Moreover, a good inventory management software will help you manage not one, but multiple warehouses and your inventory across these locations. WMS stock management system and WMS control are definitely two aspects you should look for when looking for the perfect software.
Other than looking for these features in inventory management softwares, you should also be asking yourself the following questions when it comes to picking the right inventory management software:
The number one thing that will help you find a software that aligns well with your needs is the size of your business. This is important because if you are a small business that does not deal with a high volume of orders on a daily business, you don’t need to waste money on unnecessarily complicated, hi-tech solutions. An inventory management software for small business would not be very expensive or hard to understand.
However, if you are a larger establishment, you will need to look for an advanced inventory software solution that can help you tackle problems pertinent to your business.
Of course, your choice of an inventory management software must align with your finances. If you have limited resources, you need to look for a low-end solution that can still help you with at least the basic level inventory problems. However, keep in mind that an inventory management software is a long-term investment that will definitely help you reap benefits later in the future, so if you can spare funds for it, you should!
There are many inventory management software variants available in the market. You can get really complicated ones and they can turn out to be helpful, but you need training to operate them properly. If you feel like you and your staff can’t take out the time to learn the technicalities of a complex inventory management software, then you should go for something simpler – perhaps something that requires minimal training.
Again, if you are looking for an inventory management software for small business, you can find many options that offer use-friendly solutions.
This is a comparatively broader question and it requires thorough observation on your end. Ultimately, you need to study your inventory activity closely and identify what your existing problems are and how you are hoping to fix them with the help of an inventory management software. This is not a process that can be rushed in a day, so we suggest you take a month or two understanding your inventory before you make your decision.
Inventory management is no easy task, but with the help of an inventory management software, you can turn this overwhelming task into a swift procedure that helps you elevate your business.
The perfect inventory management software depends on your business operations. However, there are many effective software solutions available in the market such as Canary7. Canary7 is a WMS stock management system that will not only help you with inventory optimization, inventory management, and inventory accuracy, but also help you streamline other aspects of the supply chain.
Book a free demo for our inventory management software today and check how Canary7 solves all your inventory problems!