Inventory management in an organization can become a serious challenge, as it is carried out in parallel with working with suppliers and managing purchases. Inventory management is an important link in the entire supply chain, including aspects such as controlling the cost of inventory, including import costs and loading expenses, managing orders, controlling the volume of sold inventory, and much more. Naturally, today it is difficult, if not impossible, to cope with all of this without appropriate software. So, what does a modern inventory management system include and what is required for it? We will discuss this in our article.
The definition of inventory management is simple: you need to have the right inventory at the right time, in the right place, and at the right price. But how to implement optimal inventory management processes to ensure the best results? Today, we are talking about inventory management system, and these programs are the best for your business, even if you do not have physical stores, but only an online store.
First and foremost, it is necessary to check the system infrastructure requirements. Today, it is important to ensure that all necessary fields are displayed in the catalog. These should include fields for personal data, minimum and maximum inventory, quantity for purchase/production, primary supplier, as well as free fields that will provide easier management, including report generation. Sometimes, it is also necessary to specify various dates, such as expiration dates, warranty dates for each item, etc. If the system includes warehouse management, information about the item's location in the warehouse should be added.
The inventory management system should support flexible price and rate management to ensure quick and easy decision-making, including support for discounts and bonuses from the supplier.
Small businesses usually rely on Excel spreadsheets to manage inventory, purchasing, and suppliers. However, you will quickly realize that your business needs a system that tracks all supply, sales, and purchasing activities in real-time. Especially as the business grows and expands, there is a need for urgent updating and improvement of information systems supporting inventory management decision-making and overall tracking of activities.
Proper inventory management is critical for uninterrupted business operations: if you order or produce too little, the customer may find the product elsewhere. If you order and purchase too much, you can get stuck with large inventories without any demand, and financial costs will increase, and then you will have to sell the product at a discount, especially if your inventory is sensitive to expiration dates. A modern inventory management system is capable of calculating and helping you make a decision about a new order from suppliers or production.
The inventory and sales data you have should provide you with the material to make the right decisions. Purchasing management system and supplier management software support all activities around inventory from all sides.
You don't want to overpay for goods that your business purchases or produces, but lower prices are not necessarily the best prices. Sometimes, for example, suppliers offer a 10% discount when purchasing 20% more. But is this the most reasonable decision for your business - to buy 20% more? Inventory management software will help you determine the optimal amount to order according to your business. The program aims to reduce business expenses by optimizing order volumes.
The Purchasing Management System not only helps determine the optimal amount of goods to purchase, but also solves other issues, such as delivery dates. Of course, you want the new shipment of goods to arrive exactly when the previous batch is ready for sale. If the new shipment arrives too early, you may face storage problems, and if it arrives too late, you may face a shortage of goods and disappointed customers. Therefore, it makes sense to rely on technological progress to help you with purchasing, including dates, prices, and quantities.
In conclusion, computerized inventory management processes of your business will free up a lot of time that you can use for making marketing and strategic decisions. You can use reports from the system to see ahead and make informed decisions. Based on our clients' experience, inventory management systems save many hours of business managers! We can provide you with inventory management software, purchasing management system, and supplier management software with all necessary features for your business.