Selecting the appropriate types and quantities of merchandise for your business can be a real challenge, especially as your business begins to grow. Managing your inventory well can help take the guesswork out of purchasing decisions, and lead to more profitability and less wastage.
In this article, we explore how business owners and inventory managers can make informed purchasing decisions with the right strategies. In particular, we look at how implementing inventory management software can put you ahead of the game when it comes to buying and selling merchandise.
Any business owner will know how important inventory management is for the smooth running of everyday processes and the overall success of the company. Well-managed inventory can reduce wasted time and misspent cash, processing times and increase customer satisfaction overall. But there are more than just immediate benefits at hand from managing inventory well. In the long term, good inventory management will also help business owners make better-informed purchasing decisions, which will further the success of the business.
Knowing what to buy and when
For businesses just starting out, deciding what merchandise to buy in accordance with demand may be a reasonably simple task. While the businesses inventory is small and easily managed, business owners can easily keep track of which products sell – and which products don’t. Moreover, when it comes to ordering more merchandise, it’s a simple matter of looking at the business’ sales history over the past few weeks or months.
However, as a business’ inventory grows and diversifies, it can become more and more difficult to keep track of the fast and slow-moving items. This will be particularly apparent for companies using manual systems to count and track stock, where merchandise whereabouts, quantities and qualities are scribbled down somewhere among the rest of the paperwork.
In these circumstances, it is near impossible to make fully informed purchasing decisions: business owners and inventory managers will need to wade through the paperwork to identify the fastest selling items (if they’ve been recorded at all). This is a time-consuming and error-prone task and one which could be made much more efficient through automation.
How inventory management software can help
One of the easiest ways business owners and inventory managers can simplify this process is to implement inventory management software and invest in barcode scanning technology. This technology will enable stock takers to quickly and accurately count products, and store information on each product in the database.
Further, when it comes to ordering merchandise for the future, business owners can simply search items in the system and instantly pull up information about its demand and decide what quantity should be ordered to meet projected demand. This is especially useful when planning for seasonal demand.
By using inventory management software to manage and oversee the movement of stock, business owners can ensure they never order too little — or too much — of each item. This will ensure customers get the products they want and prevent any obsolete merchandise gathering dust on the shelves.
Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.