If you handle inventory management, then you know how tedious it can be. You also know how important it is to track your inventory accurately. Poor inventory management can lead to product shortages and overages. Both scenarios can cause businesses to fail. That’s why inventory management software is a vital tool for businesses of all sizes.
By automating the process of managing your inventory, inventory management software can help you save time and money. It can also help you make better decisions about what products to stock and when to reorder. Let’s take a look at the many benefits of using inventory management software, key features that can help, and top software options to consider.
What Is Inventory Management Software?
Considering 24% of small businesses still use pen and paper to track their inventory, you’re not alone if you manually take care of the process.1 The task probably takes up a lot of your time, though. And it’s incredibly susceptible to human error. Fortunately, inventory management software is a tool that streamlines the process for you.
Inventory management software automates the process of tracking items in and out of stock, recording how much inventory is on hand, and notifying business owners when they need to reorder. As a result, this software can help businesses save time and money by helping them make better decisions about what products to stock, how much to buy, and when to reorder.
How Inventory Management Software Helps Businesses
If you run a business, then you know that inventory management is essential to your success. But you might not realize just how much using inventory management software instead of pen and paper can make a difference. For starters, using inventory management software can help you save time. That’s because it automates the process of tracking and managing your inventory.
It can also help you save money. By helping you make better decisions about what products to stock and when to reorder, this software can help you avoid costly mistakes. Overstocking costs the average retailer 3.2% in lost revenue, for instance, and understocking costs the average retailer about 4.1% in lost revenue.2 So, poor inventory management hurts your bottom line.
Additionally, using inventory management software can help you forecast future sales and trends. By keeping track of your inventory levels, this software can help you make informed decisions about what products to stock and when to reorder. So, inventory management software can help you better understand your customers’ needs and shopping habits.
Features To Look For in Inventory Management Software
Inventory management software can help your business in several ways. But not all software options are created equal. With this in mind, here are key features to look for in inventory management software:
- Easy to use: The software should be straightforward to learn and use, with a simple interface that is easy to navigate.
- Flexible: It should be able to adapt to your specific business needs and requirements.
- Scalable: The software should be able to grow with your business, expanding as your needs change.
- Reporting capabilities: It should provide reports on inventory levels, sales trends, and other data that can help you make informed decisions.
Beyond foundational features like those above, there are additional features that can make a difference. For example, here are some more software features to keep in mind:
- Automated reordering: Some software options can automatically generate a purchase order when it’s time to reorder.
- Integration capabilities: Many options can integrate with other business applications, such as accounting systems, to streamline operations and improve efficiency.
- Mobile app: Finally, consider looking for an option with a mobile app to help you track and manage inventory from anywhere.
Shopping Around for Inventory Management Software
When it comes to finding the right inventory management software for your business, it’s important to do some research and compare options. Before buying software, make a list of your needs. Then use your list to narrow down the choices. Some software providers offer free trials, so you may be able to test out the software to make sure it meets your needs.
There are many inventory management software companies out there, so you might not know where to start. While this isn’t a comprehensive list, here are a few options to have on your radar:
- QuickBooks Online: This option can help small businesses track inventory levels, order more stock when necessary, and even forecast future sales and trends.
- Shopify POS: Businesses with warehouse and store inventories can use this option to manage both inventories in one place, set alerts when stock is low, and generate purchase orders.
- Oracle Fusion Cloud Inventory Management: This solution can help businesses with multiple locations and warehouses adapt to supply chain disruptions, shift stock between locations based on demand, plus handle more basic tracking tasks.
Choosing the Right Inventory Management Software
Inventory management software can help you save time and money, make informed decisions about how much product to stock, and even forecast future sales and trends. Retail inventory is only accurate about 63% of the time, so many businesses could benefit from using inventory management software.3
Since every business has its own needs, be sure to explore your options to find the right fit. Some software options were designed with small businesses in mind, while others were designed to handle bigger operations. There are a lot of good options out there, so take some time to find the right one for your business.