How Inventory Management for Small Business is Going Digital
When you run a small business, proper inventory management should be at the forefront of your mind. Though it seems small in the scheme of your broader business plan, without adequate stock management, you really don’t have a working business. Besides managing your inventory, you also have to think about how to improve the process. The best way to do this is to go digital.
Of course, it’s worth noting that since the late 20th century, inventory management has always been digital in some form or another. Unfortunately, some digital practices are not as useful as others, creating problems for young businesses. For example, while you may be using a digital tool like an Excel spreadsheet on your laptop, this isn’t the type of digital advancement that will be good for your company in the long run.
Stock control is a critical component of supply chain management because it tracks the flow of inventory, starting with manufacturing, moving to warehouse storage, and finishing with the point of sale. Your stock is critical because it is literally what your customers will hold in their hands when they order something from your store. When you manage your inventory well, the flow of products to the customer is much smoother, improving sales and customer relationships as your business grows. With this in mind, you want to do everything you can to make your inventory management process as efficient and useful as possible. This is where digital solutions come in.
To really help your small business go digital, we need to look at modern technology like software solutions, integrations and applications. Such tools can truly digitize and automate the vital process of inventory management for a small business. Still not sure how things can go digital in your warehouse? You’re in luck — we’ll run through how inventory management for small business is going digital in the digital age.
How Inventory Management for Small Business is Going Digital
Inventory management is a key component of supply chain management in that it tracks the flow of inventory starting with manufacturing, moving to warehouse storage, and finishing with the point of sale. Of course, your inventory is whatever you sell to your customers: clothing, food, appliances, furniture, and everything in between. Inventory is so important because it is literally what will be held in the hands of your customers when they pay for and order something from your business. When inventory is managed well, the flow of product to the customer is much smoother and can lead to more sales and better relationships with customers as your business grows. With this in mind, you want to do everything you can so that your inventory management process is as efficient and useful as possible. This is where digital comes in:
Simple Ways Inventory Management for Small Business is Going Digital Every Day
Digital tools are like a secret weapon for small business owners. As your business grows and you start earning more sales per month, it often means hiring more staff to keep up. While large corporations can easily manage a growing team, it’s often more challenging for a small business to compete. By digitizing processes, small businesses can do things in a few mouse clicks that would take a small army to do by hand.
The right digital technology is a crucial investment for any small business hoping to compete with large corporations that have massive workforces at their disposal. The most digitally savvy small businesses earn nearly twice as much revenue per employee as other small businesses. Luckily, many affordable software applications exist to help business owners go digital. Some ways small businesses can use digital technology to improve stock-keeping operations, boost sales and remain nimble include the following.
1. Integrating Inventory Management Software Solutions
One of the simplest ways to improve inventory management for small business is to invest in stock control software solutions and integrate them into your processes. You can choose from tons of software system options, and each comes with its own advantages and features to help your inventory management system enter the digital age. Good software can do everything from tracking inventory and forecasting demand to analyzing current inventory data across various devices. The integration feature of inventory management software allows you to access inventory data from your tablet, laptop and desktop.
While each software provider has a slightly different product, at their core, stock-keeping software solutions can track your inventory automatically. They’ll use your purchase orders, received shipments, sales orders and outbound shipments to add and subtract from your available quantities. This software lets you upgrade from manually counting and updating spreadsheets to a system that tracks inventory levels automatically.
Beyond this, inventory management tools offer a range of features that can digitize many of your processes. For example, a restock forecasting feature can monitor your sales trends and calculate precisely how many days of inventory you have left. It gives you an exact date to reorder merchandise based on your desired amount of safety stock and your suppliers’ lead times. Another software feature, lot ID and serial number tracking can even let you track your inventory in batches or individually, which can be helpful in specific product categories.
Finale Inventory offers an excellent cloud inventory management software system — perfect for small businesses planning for growth. We also support warehouse management applications, alongside some multichannel e-commerce practices such as barcode labeling and scanning,serial number tracking, multilocation storage integrations and many more. In short, when you add software solutions to your inventory management practices, you enhance both efficiency and productivity.
2. Applying Apps for Different Phases of Inventory Control
You already know there’s an app for just about anything, promising to make certain practices easier than ever before. The case is the same when it comes to small business inventory management.Some apps help with payment options, warehouse management and inventory automation.
What’s the use of having an app for your key processes? For one, apps automate certain inventory management practices, freeing up time and labor power for other essential tasks. Some application integrations for digital retailersinclude ShipStation, Amazon, QuickBooks and eBay. Each of these applications can offer substantial business advantages. For example, shipping management software like ShipStation can streamline your fulfillment process. When orders come in from your website and other sales channels, they all arrive in your shipping management application, telling you which orders you must fulfill and where they’re headed.
Shopping cart applications let you set up a functioning web store online, where your site visitors can add things to a virtual cart and check out entirely online. Meanwhile, channel management applications help you manage your listings on various online marketplaces, including Amazon, eBay and your shopping cart.
All these applications serve distinct purposes for your business in different stages of the inventory lifecycle. Integrating them with stock control software makes them even more useful. Finale Inventory can help you manage and sync inventory, monitor stock levels and predict demand across different apps and sales channels. By integrating with a shipping manager, your stock levels will automatically subtract as soon as you mark shipments “complete.” It will also sync with your shipping application to let you know the pending orders you have enough stock to fulfill.
Integrations with your channel managers and shopping carts mean you can automatically update your available quantities across your entire web presence. For example, when you make a sale on your website, Finale Inventory can subtract stock levels on your Amazon and eBay stores. That way, you don’t risk overselling your products, and you spend less time updating your listings on every sales channel.
3. Digitizing Data Entry
Data entry is one of the most tedious parts of running a business. This is unfortunate because when a task is slow and, for lack of a better word, boring, the situation is ripe for mistakes. Miscounting, mistyping and math errors are all more likely when a human is in charge of data entry.
When it comes to inventory management, data entry mistakes are something you want to avoid at all costs. When you have the wrong numbers entered for stock levels, reorders, old items, and over- or understocked items, the inaccuracies can negatively affect your customers and, by extension, your business’ success.
If you think you have enough stock in an item that has run out, you may end up selling products you cannot ship out. The customer will have to wait for you to restock or be refunded. On the other side, if you think you are out of stock when you have the items in your warehouse, you’ll face unhappy customers who can’t buy what they want even though you would be able to sell it to them.
The software solutions and applications mentioned above can digitize data entry so that all pertinent data is automatically entered into the right place at the right time. Inventory management software does this by automatically factoring in your purchase orders and sales orders. When you receive shipments at your warehouse or pack up orders for fulfillment, your software automatically adds and subtracts stock from your current count. Digital programs like this make fewer mistakes than human beings, and they can also update your inventory immediately, in real time.
4. Automating Key Warehouse Processes
As many as 45.1% of industry professionals say their business is investing in warehouse automation. For most growing companies, automation is an easy-to-implement digital solution with immediate positive results. Warehouse automation can take many forms, and many software solutions and other tools can automate different warehouse processes. For example, installing a conveyor belt can automate moving inventory from one department to the next. For more advanced automation, you might install smart sensors on your equipment to notify your maintenance crew automatically when a machine needs maintenance or refueling.
A simpler-to-implement and more affordable automation solution is incorporating software. For many businesses, automating key warehouse processes is as easy as choosing an integrated inventory management system. Perfect for small and medium-sized businesses, these systems include order management, warehouse management and stock control capabilities. Having these three features in one system is a huge advantage that allows you to automate many of your manual processes.
With Finale Inventory’s integrated warehouse management system, your business can automate tasks such as creating purchase orders, splitting orders, calculating reordering points for replenishment, creating sales orders, quotes and invoices and managing returns. The software can support both customer-managed inventory and vendor-managed inventory. In addition, you can also automate shipments and handle split shipments, shipping documents, bills of materials and multiple warehouse locations.
This means that when certain stock items need to be reordered or are misplaced and hard to find, your automated system can set up a purchase order or pinpoint stock locations for you automatically. Inventory management software can also automate other processes. For example, by integrating it with your marketplaces like Amazon or eBay, you can automatically update your current stock levels across all sales channels. You’ll no longer have to update your eBay listings if a product sells out after a customer places an order through Amazon. Your stock-keeping software updates this data automatically.
When your warehouse and its key processes are automated, you no longer have to worry about doing these tasks manually, meaning there is less risk of error and inaccuracy. Further, by automating your warehouse, you and your employees are free to put your abilities and energy into different areas of your business.
5. Improving Productivity and Efficiency
When you allow small business inventory management to go digital, you improve company productivity and efficiency exponentially. Going digital can enable you to automate tasks you’ve always done manually, freeing up time, labor and money. You will not have to dedicate employees to do now-automated tasks, which can, in turn, raise salaries. It can also help create more focused jobs your business couldn’t sustain without a digital system taking care of crucial behind-the-scenes work.
Digitizing your stock-keeping workflows is more than just adding software. You’ll also upgrade your office and warehouse to better, more efficient electronic devices. When your business has many laptops and tabletson deck, everyone has access to everything, enhancing teamwork and productivity. What’s more, going digital allows workers to communicate better and more swiftly. Everyone can ask questions, get answers and carry out directions faster and more efficiently.
Another piece of hardware to consider adding to your warehouse is barcode scanners. These devices can streamline warehouse operations even more than inventory management software alone. Barcode scanner hardware and software integrations reduce errors and speed up many warehouse operations. Your receiving department can use them to mark shipments as received by scanning products’ existing barcodes.
Also, by giving every sublocation in your warehouse a dedicated barcode, your pickers can be automatically directed through your warehouse, scanning the items they’re pulling along the way. A barcode scanner tells them which items to pick and when they make mistakes, leading to fewer picking errors.
6. Accessing On-the-Go and Up-to-Date Data
One benefit of automating your inventory tracking is that your data updates in real time. The second you create and send a purchase order to a supplier, your software updates to let you know you have new stock coming in or available to promise. When you receive a replenishment order at your warehouse, it updates your quantity on hand. When you receive sales orders from your customers, your software will subtract the correct number of units from your available stock. Finally, when you ship an order, the totals subtract from your quantity on hand.
When you do these processes manually, you may send purchase orders or fulfill orders without updating your spreadsheets right away. It may take until the end of the day or even the week to update your stock records with all the inventory you acquired and sold. After you update your records, they quickly lose accuracy since your online sales channels are open and accepting orders 24 hours a day, seven days a week. With inventory software, your stock records update almost instantaneously. You’ll always know exactly how much stock you have right now.
Once small businesses update their processes to use real-time data, they need to access it from wherever business takes them. In a typical warehouse, most of your workers spend much of their day on their feet. As a small business owner, you might be heavily involved in warehouse operations, traveling through warehouse aisles, and doing important work in your receiving dock and fulfillment areas alike. With everyone in your bustling warehouse constantly on the move, it’s critical to access data wherever you are.
By implementing a cloud-based software solution, all your inventory is available online for easy access. Instead of being stored on your work computer, it’s stored online in the cloud. You can then access the data from phones, tablets and laptops. Anyone can access that same information with an account login and internet access.
It lets you and your team keep up with your inventory records using a mobile device from anywhere in your warehouse. Your data is visible from any of your warehouses, from your home office and on business trips. With the barcode scanning app and a mobile device, pickers can also access that information as they pull inventory for fulfillment.
Why Your Small Business Needs Digital Inventory Management
In 2020, 51% of U.S. retailers said their inventory management system needs improvement. A digital integration like Finale Inventory may be just what retailers like you need to optimize stock control processes. Digital inventory management software offers many useful features that help businesses get better control over their stock. It can simultaneously save you money and improve your sales opportunities and customer relationships. With benefits like these, a powerful software solution like Finale Inventory can help you boost your profits and get more organized.
When you invest in this technology, you can:
An excellent way to increase your profits is to reduce costs. Automating manual processes means less time spent managing your inventory, which saves you money in employee wages.
Automating your inventory management also has the benefit of helping you reduce your stock on hand. When you know exactly when to reorder products to replenish your stock, you can keep less buffer stock and reorder only as often as you need to fulfill your customers’ demands. By reducing the amount of merchandise you need to store, you can reduce your storage costs. You’re also less likely to have excess stock that you must sell at a discount as you wrap up your busy season.
Maximize Sales Opportunities
With automated inventory management, you’re less likely to run out of stock. Dynamic reorder point calculations give you an exact order deadline based on your supplier lead times and current sales velocity. By taking the guesswork out of stock replenishments, you can always have a steady supply of products ready to promise to customers. It significantly reduces the chances that a product will be out of stock when a customer wants to buy it. You’ll earn more customers and keep your existing ones by always having your products in stock.
Gain Useful Insights
Once you automate inventory tracking, you have many custom reports and statistics at your fingertips. You can analyze a products’ price history or calculate your stock-keeping costs by examining your turnover rate and standard accounting costs per unit. Gain insights into your sales velocity, the average amount per sale and more. Your software’s dashboard offers a wealth of valuable insights in a visual, easy-to-understand format. You can keep your finger on the pulse and make quicker, smarter decisions by having this information readily available.
Scale Your Business
Digital inventory management software can grow with you. Since it calculates your stock levels automatically, it can work just as fast whether you make 100 sales a month, 1,000 or 1 million. At Finale Inventory, our architecture can support more than 1 million transactions a month and just as many individual SKUs. We designed our software to help businesses grow. You can access our basic features for a low monthly cost to support a small team and upgrade your plan at any time as your business expands.
Automate Document Creation and Organization
As a retailer, you generate a lot of documents. You create purchase orders for suppliers, sales orders for clients, invoices, barcode labels and many other documents. It can take a lot of time to fill in these forms by hand, organize them within your file storage system and pull them up when you need to look back on them.
In inventory management software, you can create all these documents on one central platform. Your software can even auto-populate information into your forms, such as the supplier’s name and the quantity you need to order. All these documents are easily accessible from your software, and you can access various reports based on these documents at any time.
Digitize Your Inventory Management With Finale Inventory
Finale Inventory is the perfect solution to help small digital businesses and e-commerce retailers control their inventory. Our software is robust, flexible and scalable enough to meet your company’s needs. We’re committed to personal service at every level. When you sign up for Finale Inventory, you’ll have a dedicated support representative who will get to know your business and existing workflows to help you implement Finale Inventory and get the most out of your software. We’ll help you get started with helpful training sessions, unlimited support and no onboarding costs.
To learn how Finale Inventory can help your small business with inventory management, start your free trial today!