Inventory control and planning are actions that are involved in the inventory management process. As with all management processes, planning and controlling are key to successful management. The reason that such a focus is given to inventory is that inventory usually represents the largest cash-flow part of the business. This is both in relation to purchasing inventory and selling inventory. For this reason, management of inventory will, in turn, have a knock-on effect on the finances of the business.
With smart inventory management, your business will enjoy many benefits. Here are the top 11 benefits of good inventory management:
1# Inventory Balance.
Good inventory management helps you figure out exactly how much inventory you need. This makes it easier to prevent product shortages and keep just enough inventory on hand without having too much.
2# Inventory Turnover.
You need to keep a high inventory turnover ratio to ensure your products aren’t spoiling, becoming obsolete or sucking up your working capital. Calculate how many times your inventory sells in a year and see where you can make better use of your resources.
3# Repeat Customers.
Good inventory management leads to what every business owner wants – repeat customers. You want your hard-earned customers to keep coming back to your business to meet their needs. One way to do this is to make sure you have what they’re looking for every time they come.
4# Accurate Planning.
Using smart inventory management, you can stay ahead of the demand curve, keep the right amount of products on hand and plan ahead for seasonal changes. This goes back to keeping your customers happy all year long.
5# Warehouse Organization.
If you know which products are your top sellers and what combinations of products your customers often order together, you can optimize your warehouse setup by putting those products close together and in easily accessible places. This speeds up the picking, packing and shipping processes.
6# Fewer mistakes such as overselling
By synchronising all of your online marketplaces and webstores, you can be sure that your stock levels are adjusted each time you make a sale, in turn reducing the chance of overselling.
7# Inventory Orders.
If you’ve done a good job keeping track of how much inventory you have on hand, you can make smarter decisions about when and what to order. Inventory management software lets you speed up the ordering process. You can simply scan a product barcode and type in some information to place an order and generate an invoice.
8# Inventory Tracking.
If you have multiple locations, then inventory management becomes even more important because you need to coordinate your supplies at each location depending on differences in demand and other factors.
9# Time Saving.
Inventory management is a great time-saving tool. By keeping track of all the products you have on hand and on order, you can save yourself the hassle of doing inventory recounts to make sure your records are accurate. This once again requires inventory management software.
10# Cost Cutting.
When your inventory is humming along efficiently through your facilities, you can bet you’ll save a lot of money. Inventory management helps you avoid wasting money on slow-moving products so you can put it to better use in other areas of your business.
11# Employee Efficiency.
You can empower your employees to help you manage inventory. Training employees to use barcode scanners, inventory management software and other tools help them make better use of their time, and it helps your business make better use of its resources, both human and technological.
Inventory management systems do much more than simply count product. They help businesses improve efficiency by automating many tasks such as collecting sales data, forecasting for future sales, and repricing and reordering product. If you aren’t currently using an inventory management system for your business, or want to improve upon one you have in place, now’s the time to check out for the products offered by Coderack IT Labs.