Tracking inventory can be tedious work, but it’s vital to running a business. Inventory management systems are designed to handle most of the administrative work, making it easy to put an important part of your business on autopilot.
So what exactly is an inventory management system?
It’s a software application that automatically updates your inventory as sales are made and items are shipped. It monitors your supply in real-time and helps you plan purchases from wholesalers and manufacturers. Perhaps most importantly, it’s a tool that helps you keep a finger on the pulse of your cash flow.
When you think about growing a business, you might first think about offering new products or finding new marketing channels. Improving your inventory management might not be at the top of your list, but there’s compelling evidence that it should be.
A good inventory management system can help your business in three key ways:
- Save Time : Instead of spending hours auditing and tracking inventory on a periodic basis, you have have a dynamic look at your business. You’ll know when you’re running low on a product, so you’ll never keep customers waiting on their orders.
- Cut Costs : According to the 2016 National Retail Security Survey, 16.5% of inventory “shrinkage”—i.e. lost inventory—results from administrative and paperwork errors. This results in costly audits and lost time. The most efficient way to manage inventory is to automate it.
- Budget and Forecast: Real-time data helps you make decisions about purchasing and sales. You’ll know what products your customers love and which suppliers are slow to deliver.