When you are trying to run a business efficiently, a lack of helpful tools or outdated tools can make work stressful. While inventory and stock are not the most glamorous areas to manage, they are necessary to your business’s success.
That’s why every business needs an efficient inventory management system, whether upgrading an existing system or choosing a better inventory management option. Read through the following signs to determine when to update inventory management systems for your business.
9 Signs You Need to Upgrade Your Inventory Management System
If you’re wondering whether it’s time to change your inventory management system, review the following signs. Relating to any of the following means it’s probably time to change the way you do inventory management.
1. You Spend Too Much Time Consolidating Data
Your inventory expands with customer demand. However, a growing inventory also comes with an overwhelming amount of paperwork that can consume your time and energy.
2. You Frequently Have Out-of-Stock or Back-Ordered Items
Without proper inventory management, you don’t know how fast your products are selling and when to restock your inventory.
3. Your Business Is Growing Fast
A growing business means increased paperwork. If you manually manage your inventory or have an outdated inventory system, you have less of a chance of keeping up with your customer demand.
4. Your Current Software Company Is Going Out of Business
If your software provider is going out of business, your platform will shut down. Look into a new management software so you can transfer your information before you lose it.
5. You Track Your Inventory Manually
Manually tracking inventory takes time and energy that you could spend improving your social media presence, store management and customer service.
6. Your Money Is Stuck in Excess Inventory
Without meticulous management, you may order products based on rough estimates. These estimates put you at risk of losing money to more products than your customers need.
7. Productivity and Morale Are Decreasing
Traditional inventory management tools are outdated, making them more difficult and time-consuming to use. As a result, productivity will be low. When productivity is low and your inventory management tools are less than ideal for your needs, staff morale will decline quickly. Employees will have less drive and enthusiasm, which contributes to decreasing productivity.
8. You’re Experiencing Frequent Errors and Mistakes
Most traditional inventory management methods require significant amounts of manual work. When processes are completed manually, there is more room for human errors and mistakes. While human error will also be unavoidable to some degree, you may need to consider upgrading inventory management to have automated features if mistakes and errors occur frequently.
9. Suppliers, Partners and Competitors Have More Advanced Systems
If competitors and supply chain partners upgrade to more advanced inventory management tools, you may envy their capabilities or feel left behind. Updating your system can potentially increase your profitability and help you gain ground on your competitors.
How to Improve Your Inventory Management System
Improving your inventory management system helps your business grow. Making a few changes to your management system can result in major improvements across your supply chain. Here are four ways to improve your inventory management system:
- Implement barcode tracking: A barcode system allows your business to efficiently and accurately track inventory. For example, rather than having employees manually count inventory shipments, utilize barcode scanners. This method reduces the risk of human error and is significantly more efficient and accurate. Scanners also immediately transfer inventory updates to your inventory management software, which eliminates another step for your employees.
- Set minimum stock levels: Achieving the perfect inventory level for every product is nearly impossible. However, setting minimum stock levels is an effective step in the right direction. Doing so allows you to order new inventory before your current stock runs out. This method helps prevent your products from going completely out of stock. Set your minimum stock based on how often a certain product sells and how long it will take to receive new stock.
- Clear obsolete inventory: Obsolete or slow-moving products take up valuable space in your inventory warehouses. Be careful not to overlook these products. The longer these products sit on your shelves, the more value they lose and the less space you will have for more important business components. Be proactive with your inventory so obsolete products don’t hurt you. For example, put obsolete products up for sale at a heavy discount to clear some space.
- Choose the right inventory management software: You’ll come across several different inventory management software options, so choosing the right system for your business is crucial. For example, consider whether a system has the features you need, will be easy to use and can integrate with your sales systems so everything works together. Being able to test how the system will work for your business is also a great way to determine if the software is right for you.
Choosing New Inventory Management Software
Whether you track inventory manually or need new software, switching inventory management systems should make business easier. Today’s software systems are fast and can reduce the potential for human error. You also have more control over your inventory, and these systems can increase your profits over time.
Keep the following questions in mind when searching for a new software system:
- What is my budget?
- Do I need a basic or advanced system?
- Is the software adaptable to my business now and its future growth?
- How long will the software take to implement?
- Does the company offer customer assistance?
Finale Inventory Has an Inventory Management Solution You Can Trust
Help grow your e-commerce business by using the proper tools for inventory management. Finale Inventory offers a cloud-based inventory management software for your business’s inventory needs. No matter your company’s size, our software can meet your demands quickly. Our plans are month-to-month with no paid long-term commitment. You even receive specialized training for your new software system when you sign up for a program.
Do you want to try our software before changing inventory management systems? Start a free trial on our website and request a live demo to learn how Finale Inventory’s services can benefit your business.