Any business owner who is part of the wholesale distribution industry should be very aware of inventory control. Essentially, inventory control is the overarching awareness and oversight over a company’s inventory stock. Inventory control is paramount to running a successful business.
The Impact on Your Business
It’s imperative to understand what your inventory levels are in your warehouse and when stock is coming in and out of the building. It’s a delicate balance to know how much stock to order because you don’t want to order too much or too little. Forecasting consumer demand can be difficult and trends can change rapidly. Just because a product was popular last holiday season doesn’t mean that it will sell the same way again in the next holiday season.
If you don’t have a product available that a customer requests then you could lose a sale. Every sale is important and an upset customer might pass on negative feedback about your company to other people. The last thing you want to do is drive potential customers away, especially if the problem happens more than once or a customer has to wait a significant time for a product on backorder. It is important to have a strong awareness of what is happening with your inventory. If you do not know what is going on with your inventory, it is highly likely that is will negatively impact your ability to provide good customer service.
Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. When not writing about inventory management, you can find her eating her way through Auckland.
The Role of Inventory Control
Inventory control systems play a key role in balancing warehouse stock. There are cloud-based inventory management systems that can track inventory levels in real-time. These systems are more effective than manual systems. If you try and keep track of your inventory manually, every transaction and movement that a product undertakes needs to be recorded by hand. This process is arduous and can lead to human error. These mistakes can lead to errors in inventory count and can impact your order numbers and profits. Moreover, this information is difficult to share as it is often not integrated into a cloud-based system.
Rather, by using inventory management software, it can provide you with up-to-date information. It can play an important role in determining the right balance of stock in a warehouse with very accessible data on your products. With real-time information you can be across any changes in stock information instantly. You can see what items are selling and which products are remaining stagnant on your warehouse shelves.
Stagnant inventory or excess inventory that piles up in the warehouse is also something to be concerned about. If too much product is just sitting there, it can cause profit losses. These losses happen when the product has a finite shelf life. It could expire or pass a use-by date that prevents it from being sold. It could get damaged while it remains in the warehouse or it could become redundant if it’s a season specific product like ski gear or swimming toys.
Being able to properly balance your inventory happens when you fully understand customer demand. Inventory shortages or excesses can be problematic for your company. With the right inventory management tools such as real-time software, you will be able to leverage data and forecast effectively to better anticipate customer demands.Topics: cloud inventory management, inventory control, inventory software