No matter if you are professional in e-commerce field or just a small business owner, having an optimized inventory system can help you find more opportunities to free up you limited capital resources, increase operation efficiencies and boosts your profit in long run.
Using Inventory tracking and management tools can allocate physical storage spaces economically and transportation resources effectively for your business.
A good inventory management system can also identify what products in your stock are popular and trendy, gives you a signal to actively prepare stocks to satisfy the needs in advance.
Here are two things you must do for a successful inventory management.
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Professional Inventory Management Software
Inventing a new wheel is not necessary either in technology or on an economical consideration, sometimes it’s not possible. Focus your business on the real important: business operation, find a suitable inventory management system on the market that allows you to achieve some accuracy and efficiency goal.
Before making decisions, factors you must take into consideration are:
- Features. Not all inventory management systems are e-commerce compatible, Based on your own business needs and check the integrations provided by the inventory system if good enough for your operation.
- Complexities: Complexities are prone to errors or mistakes. Have an easy and intuitive guide, a great system software must be simple, complexities are not good for operate business efficiently. Overall investing too much money to train employees to learn a complex system, it’s expensive.
- Accuracy: verify the data accuracy and integrity of the software provides. Sometimes a small digit mistake is difficult to detected, which in result make your business hard to maintain. If you are not careful, you may end up with some data sheets you can not identify with your actual inventory data.
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Schedules & Plans for Inventory Operation
An inventory tool alone can’t solve the problems in your company, you must make rules and systems for the employee to execute it accordingly. Here are some advises you might want to know:
- Cycle counts. based on your scale, doing a regular stock count, like twice a month or twice a half year. Solve a problem before it grows big. Regular cycle counts allow you to detect small deviations as quickly as possible. The number of cycles refers to a perpetual inventory type for subsets of goods. It’s not as daunting as it could be. Most of these cycle controls will be based on the best selling and seasonal products.
- Privileges and rules: When you business grows, you are inclined to hire more people to manage your business. To prevent disaster before it happens, you must make authorization and training plans, ensures everyone who engage in the business procedures are systematically trained and pass the exams.
- Storage and label: You want the warehouse operators know and can easy identify and locate the rack or shelf where the products are placed. Maintaining a datasheet or manual for your warehouse is required, then labeling your products, organize and place them practically in your physical storage space.
- Inventory automation. When some procedures become difficult to execute and maintain, it means you reached a point to decide to do system optimizations, or replace the system entirely with new one. Initially money investment seems not cost effective. But in long run, it can help you generate more profits, decrease the operation costs. avoiding errors in shipping and inventory data, make your customers and also your employees happy. this is rewarding and promising.
- Cooperation. To achieve a business goal, cooperation and coordination is very important. Link your goal with the things your team members want. Once your whole team knows the mission and execute your plan well, you will definitely make it a success.
Mistakes to Avoid in Inventory Management
- Performance Standards. It’s hard to address the issues or detect problems if you don’t have standards. Whether your order management system is good enough or the inventory tracking runs well, continuous monitoring and auditing is crucial, Implementing KPIs (Key Performance Indicators) is an effective solution to help you track inventory management performance.
- Over-ordering and over-selling. Imagine: Your business goes very well with orders flooded in every day. Your products are exceptional, the reviews show that customer’s satisfaction and sales are off the roof… This is done until a customer placed an order and you discovered no inventory available for him/her. On the other hand, maybe there are products that did not work well, but you did not realize and still ordered many units untouched in your warehouse. These two scenarios and errors both stem from the same problem: lack of forecast.
- Planing and forecast. If you have no idea what are in the stock and don’t know what its implication on current or future operation, this is a big problem. You must have clear visions on how your business will have and the impact it placed on the availability and the money you need to invest in the future to keep the stock in a good performance. Inventory differences can result in the orders can’t been fulfilled.
- Employees training. Many organizations monitor the importance of training workers on how to manage inventory, this is a big mistake! It would make sense to hire an inventory management team or manager who already had experiences in that field. A manager also means who is responsible when things go wrong. Of course, when new software solutions are introduced, it makes sense to train all employees. If your organization still uses spreadsheets or other manual entry methods to monitor inventory and deliveries, it wastes time, money, and efficiency. In addition, there is a chance that a small mistake lead to complex errors. Facts shows automatic inventory management makes it less in errors, it’s also time-saving!
- Inventory Coordination. There is no good inventory system if you don’t coordinate inventory well regularly, whether the inventory is low in stock or have too much stock, this sometimes must be checked every day to achieve the consistency and accuracy.
- Active management. It’s easy to believe that more inventory items require more storage places. Storage management isn’t about how much storage space you have, but how efficient you use it. Allocate your inventory into different storage spaces or too many locations, it’s expensive and difficult to manage and sync data, Centralize your inventory into a central storage area to simplify procedure. The inventory management software can help your calculate.
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MXSKU provides inventory solutions, the online version integrates online and offline business together. it’s a great and affordable solution for small business owners. you can try it free here, or view the demo store here.
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