There are an array of software applications and capabilities available to us that were not even available a year ago, making investing in new technology and software a bit daunting. What happens if your state of the art online inventory management software becomes outdated? Sometimes companies try to mitigate this by adding more technology on top of old technology. This ad hoc solution does not always achieve a better outcome in the long run. These systems have communication problems and the lack of integration can lead to more harm than help.
Why integrate inventory management software and accounting software?
Many companies will already have accounting software in place and a system for their inventory management. However, these two systems may operate independently of each other despite having a lot of information worth sharing.
In order for inventory management to be effective, it needs to communicate with multiple aspects of the business. Although inventory management software can track physical inventory stock, it needs to integrate with other parts of the business to yield the best possible optimisation.
Two of the most strategic systems to link together are online inventory management software and accounting systems. By combining these two systems, it allows a company to streamline information efficiently. This allows them to plan better and make better decisions. Forecasting can be more accurate and manual reconciliation mistakes can be minimised.
What benefits will you see?
When deciding to amalgamate your software services, it’s important to think about what benefits you want to see. By aligning these systems you can gather information in real-time about inventory and accounting.
Inventory optimisation can be achieved if the online inventory management system communicates with the accounting software. Inventory is always a balancing act – you don’t want to have too much, but you definitely don’t want to have too little!
With the right amount of inventory stock, you can manage expectations of customers and investors. Customers want instant satisfaction, meaning that they want the product available when they want it. They don’t tolerate waiting when there are so many other places to shop. However, investors want to minimise working capital that is being held in excess inventory. If your accounting system communicated with the inventory system, you could plan to have the right amount of inventory based on sales orders and previous accounting history.
Since inventory is one of your biggest assets it is imperative that you keep track of it properly. Annual reports and tax returns need to be correct as inventory is one of your largest recorded assets. Therefore, it is absolutely necessary that your accounting books match the physical count of your inventory in the warehouse. One of the best ways to ensure this is accurate is by aligning your inventory and accounting software systems. Now inventory stock can be cross referenced with accounting sales.
A key feature of this type of software integration is transparency. With everything in one place, it is much easier to grasp what is going on in a company. If there are problems, the issue should be transparent enough that it can be solved relatively easily.