As an SME, you probably have a lot of capital invested in inventory. And while it might be one of your primary sources of income, it can tie up a lot of money if your management systems are not fully functional. In fact, proper inventory management is one of the keys to a successful business. Managing inventory decreases costs and increases your sales, which is, undoubtedly, what we all want.
If you’ve been in business for a while, you’ve probably heard of cloud-based software. Cloud software is a cost-effective alternative to legacy systems and offers everything a business needs to hit the ground running.
Here are 5 tips for you to manage inventory more efficiently:
1. Invest in Barcoding.
Yes, this does mean some physical hardware, but a €25 barcode scanner and a €100 Dymo label printer will save you countless man-hours of manual typing and correcting mistakes. Most scanners act like a keyboard, so instead of typing, just scan wherever you need the number. No double-checking what you typed. No reading glasses. Just point and scan.
2. Take advantage of your remote tools.
With the ease of access to tablet and phones, having to go to a specific computer to look up a spreadsheet that’s only on that computer is not the way to run a business. Anything important needs to be in the cloud where it’s backed up and accessible from anywhere 24/7.
Office 365 and Google’s G-Suite are excellent examples of cloud-based business tools. If there’s a spreadsheet that needs to be accessed, you go to your web browser, log in and access it. Your inventory system needs to have that same cloud-based setup. If you have server racks in your business that manage your inventory, you’re probably doing it wrong. Also, you can probably run your business on Excel spreadsheets, but if you want to get serious, you need a cloud-based inventory management system.
3. Anything that can be automated… should be automated.
Let’s be honest: Manually updating a spreadsheet of inventory may be fine for a freshly-born startup, but Excel spreadsheets and manual inventory management are a thing of the past. They are labor intensive, painful to use, and outdated. Updates need to be tracked in real-time. People are bad at sitting for hours at a time and counting things over and over. It’s not what they’re made for.
Why torture yourself when there is a cheaper alternative out there?
Automation is now possible using inventory management systems. You can automate many different areas such as maintaining accurate stock counts, low and high stock alerts and automating workflows. So ditch the manual spreadsheets and sticky notes for trying to track inventory. Let software handle the tracking and storage so your team can tend to customers, close a sale, meet with a supplier, scout for the next location, or anything else that can’t be done by a robot.
4. Ensure inventory is easily cataloged and referenced.
Once it’s in your system, you should be able to look it up with ease. For instance, you don’t want your clients to think you have an item in stock only for them to find out at the checkout that it’s sold out. There’s no point in having all the info in one easy system if your info is a mess. Invest that time up front to set up a clean, detailed inventory. It’s a pain at first, but as they say a stitch in time saves nine
Remember, you’re building a library that you’ll keep coming back to. You’ll also have to train new employees later on. So make it consistent and make it easy, but make it yours.
5. Forecast The Inventory Demand
One of the most important things for a any business is the capacity of forecasting. When you and your staff can predict your business inventory requirements, you gain control over your operations and can even anticipate your customers’ demands.
Many retailers get into trouble with this particular problem, especially because companies often lose sight of their stock, which ends up costing them money and resources.
Your forecast capacity should factor into historical sales trends, seasonality, and economic climate. In a nutshell, you need to stay on top of both your stock and your client’s needs, so you don’t hold either an excess or insufficient inventory to minimize the financial impact on your business.
A good rule of thumb is never to stock more than 1.5 times your turn rate during a delivery cycle.
Final Thoughts
Your inventory is the life and blood of your business. For that reason, you need to keep a close eye on it to prevent problems and increase your bottom line.
Let’s rewind for a minute:
- Identify the potential issues in your inventory management systems
- Try to prevent your inventory needs and try to keep a healthy amount of stock in your store
- Automate your inventory management as much as you can
If you want inventory robots of your own, Turbo Inventory plans are available now for as low as €1.30 per day. Right now, you can sign up for a 30-day full-featured free trial of Turbo Inventory with no credit card required.