As your small business develops, inventory management gets harder to maintain. Your team will likely be juggling stock through multiple channels, as well as managing raw materials. Even for the smallest companies, this can easily get out of hand.
Whilst it's tempting to view inventory management as an issue for only the largest businesses, smaller stockists and wholesalers need to stay on the ball as well. So, how should your business manage its inventory? In this detailed guide, you'll find everything you need for inventory management success.
First and foremost, what is inventory management? Put simply, it refers to the processes and tools a company uses to keep track of its stock. That includes purchasing, storing and selling stock, along with forecasting future sales trends. Whilst many recognise the benefits of inventory management systems for the largest corporations, the advantages it offers small businesses are often under-estimated.
Many smaller companies assume they can manage their inventory manually - using either Excel spreadsheets or pen and paper to track their inventory. However, in reality, this approach creates many challenges for small businesses. Here are just a few reasons why robust inventory management is important for smaller organisations.
If stock is languishing on your shelves, it's not just tying up capital but taking up space that could be occupied by more popular products. Similarly, if stock is too low, you could be at risk of stock-outs. Improving the visibility of stock levels and usage rates, ensures you can maximise profits and improve availability.
Even if your business is small, it's possible that you sell on more one platform. You might sell from a website or eBay store and take sales over the phone too. Maybe you also have, or are considering, a trade counter. These channels soon add up, and they can become difficult to track. Inventory management software ensures that if your trade counter has a stock-out, your other platforms are updated - along with your purchasing team.
As your business grows, the demands on manual stock taking increases, with more orders and potentially more stock, you'll need additional staff for processing and administration, which can be expensive. A stock control system like Profit4 will automate the manual tasks involved in inventory management and enable you to scale without the need for additional staff, while also ensuring orders are dispatched quickly and efficiently.
So, what should you avoid when it comes to inventory management? There are many errors that small businesses could potentially make in this area. Staying aware of what to avoid can help you to pinpoint what works best.
Inventory management shouldn't be a guessing game. Restocking every product based on gut instinct won't make the best use of your inventory. Some products will sell better than others and you need to be aware of your best-sellers and non-movers. That's where detailed reporting and analytics comes in.
Your approach to inventory management should always be data-led. With inventory management software like Profit4, you can see what's selling and what's not, along with clear demand forecasting. This helps you to make informed decisions about which products to restock and which to sell off quickly.
Spreadsheets can only take your business so far. They need to be updated manually whenever an item is sold or returned. That takes up valuable time for your staff. The more stock in your inventory, the harder that spreadsheet will be to track. Then you're more likely to be working with inaccurate data. That can lead to stock-outs and negative customer experiences.
As your business scales up, you need a solution that scales with it. Inventory management software automates your stock control, reducing human error and updating in real-time. That keeps you in control and gives you more time to focus on your business.
When it comes to inventory management, visibility is everything. If you don't know where a product is located, or even if it's in stock, you run the risk of overselling. Alternatively, you may undersell, with deadstock stuck to the shelves for years on end. Ultimately, that all adds onto your storage costs.
Keeping track of your stock can be difficult, even for smaller businesses. Fortunately, inventory management software keeps your stock visible across multiple warehouses and sales channels in real time.
It's no secret that larger suppliers and wholesalers enjoy the benefits of stock control software. But can it really help smaller companies? The answer is a resounding 'yes', and here are just a few reasons why.
Stock control software offers a whole host of automation tools. One of the most important for small businesses is automatic purchasing. You can customise minimum, maximum and optimum stock levels for every product. Once stock falls below the threshold, a purchasing order can be raised automatically with your supplier.
Your business doesn't operate in a vacuum. From couriers to online platforms, there are a variety of services your company will use to reach customers. Whether you sell on Amazon or ship with DPD, Profit4 enables easy integration.
When you're building a small business, you're often on the go. You may even have team members working remotely. Profit4's inventory management software is entirely cloud-based, so you can keep track of your stock from any location.
No two businesses are exactly alike. Whilst spreadsheets offer some room for customisation, inventory management software takes this to the next level. From creating unique dashboards to custom reporting, you'll have all the data you need right at your fingertips.
Inventory management software is essential for businesses of all sizes. From automating manual tasks to keeping your inventory visible, Profit4 streamlines stock control for small businesses. That way, your team can focus on what they do best.
Ready to learn more? Contact our friendly team or watch our 3-minute demo to find out how Profit4 can transform your inventory today.
