5 Steps to Improving Inventory Management

Change happens fast in technology, sometimes faster than businesses can keep pace with. While some companies are very open to change, often becoming early adopters of new technology or innovations, others are more careful, preferring the ‘don’t fix what isn’t broke’ approach.

Regardless of where your business sits on this spectrum, there is always an opportunity to reassess the processes and techniques being used, and recognise what can be improved, streamlined or cast aside. Regular housecleaning of this sort can pave the way for positive change, some minor tweaking or, at the least, the happy realisation that everything’s running smoothly as is.

Inventory management is an important factor for many businesses, and one that is as susceptible to bad practices as any other. Although there is a wealth of software and techniques available to make the job easier there are often undiagnosed and ongoing problems due to inexperience, misconceptions or poor implementation.

With this in mind, let’s take a look at some ways to improve your inventory management, helpfully boiled down to five straightforward, critical suggestions.

Make use of ERP software

When it comes to optimizing inventory and overall business management, Enterprise Resource Planning (ERP) software is the real deal. Good ERPs act as the central brain to every process of your business. From sales, marketing, product planning and forecasting to manufacturing, shipping, payroll and purchase orders.

Sold to businesses as a collection of integrated applications, ERPs can provide a meaningful and accessible way to view the real-time data of a business’ whole operations, including the relationships and data sharing between each department.

ERPs help to optimize inventory management in a variety of essential ways, including the efficient tracking of inventory, alerts and reorder points for stock and products, supply chain management, purchasing and packing to name a few.

Choose a platform with integration

There are of course exceptions to the rule, but generally speaking, a platform that offers integration with other software is a good way to improve your inventory management without undermining the other processes of your business. This is especially true if your business is already using software that you like and want to keep.

Do regular physical inventory counts

While technology keeps providing innovative ways to utilise more automated and efficient inventory control, sometimes the basics get overlooked. Doing a regular physical count of all inventory helps to track what’s been lost, broken or become obsolete. This is particularly important for businesses that store and use raw materials or products that have an expiry date.

Employ safety stock techniques for new products

Forecasting is a great tool, but it can only do so much for new products. Demand can be fluctuating and unpredictable, so sometimes some basic techniques need to be used to protect against the possibility of stock-outs. The use of safety stock is a tried and true way to take out some insurance against an unpredicted demand for new products.

Make use of cloud and mobile technology

Creating quite a buzz in recent years, both cloud computing solutions and mobile technology have helped to add a new dimension to inventory management. There are some traps though, so it’s a good idea to carefully assess what your business actually needs – just because something’s new doesn’t necessarily mean that it’s better.

When used well, both provide some fantastic solutions. Cloud computing is a great way for any sized businesses to have access to cutting edge software and data storage solutions. Most Software as a Solution (SaaS) are available on subscription, with little set-up. And as maintenance and updates are done at the provider’s end, businesses can often cut back their ongoing IT costs. There is the added advantage with software subscriptions of not having to pay for a package in entirety and up-front. If a product doesn’t deliver, businesses are free to find another product that will.

Mobile technology also offers some great warehouse and inventory management solutions, including barcoding and portable mobile access. Again, there are some dangers with poor implementation, but, when utilized well, the advantages are huge.

OutserveWeb are Xero Accounting Software and an Unleashed partner and can help your business control and streamline stock management to help your business grow and become more profitable. Contact us for more information.

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