So you set up your own start up and all the pieces are coming together. You look at your stock and start thinking how are you gonna manage to get inventory done when you are short on manpower. Like the smart little technopreneur that you are, you figure out that there has to be an app for this and you would be right. There are a lot of inventory apps swelling the market right now but from installation to its use there can be a lot of road blocks that you have to take care of. Hopefully, this article can teach you all you need to know about inventory management and will try to sort this out for you.
Do you need an inventory management system
The first thing that will pop to your mind whenever there is some hefty task at hand is do you really need to do this. The same goes with setting up your inventory management system. The quick blunt answer is yes and in fact absolutely so. Your assets are part of the business capital that directly measures the value of your company. If there is one thing that you should keep track of to ensure that you are not losing money then it is your inventory. Besides that, there is also a huge disadvantage when deciding to take for granted the set up of your inventory management system. Think of all the tasks at hand that relates to your inventory. From counting the assets, the purchases and the tracking – there are just too many things that are directly affected with inventory management.
It is not enough to set up your inventory system early, you also have to make sure that you have set it up correctly. Down the line, you will have to migrate your data into another data repository and thus keeping it nice and tidy where other systems can easily interface with it should be first priority. It also helps that you regularly update to newer versions to ensure that your system will not be left on decade old platforms that no one else is going to use. Inventory apps such as those sold as a service and downloaded through the internet kind of solves this problem. Most of these services are hosted by the creators and thus they hold all the data and will be the ones to ensure that the data is always kept in pristine condition ready to be migrated at any time. They also keep the software up to date with all the new shiny features that mobile technology has to offer. And since all these are done via the internet, setting this up should be blazingly fast.
Let’s talk about the basics
Now that we have established that it is vital to have your inventory system set up as soon as possible, lets now begin to talk about the basics of inventory management that each business owner has to know about. Inventory management is organization and tracking of all items of value that the company owns. This includes the supply flow analysis, keeping record of their movement and most importantly monitoring their value. Part of the functions that it has to perform is to ensure that the business never runs overstock which could lead to spoilage, depreciation and disposals nor should it go undestock and limit operations which could lead to delays. Another aspect that inventory management has to take care of is forecasting inventory stock levels. There is an entire topic devoted solely to ensuring that the warehouse always has the optimal quantity of a given item at any point in time.
With that in mind, the next step is setting up your inventory management system. There are quite a few options that you can choose from when setting up. Each of which will depend on several factors about your business. These factors can be summarized into requirements that should then be catered by the design that you have come up with. These factors include the type of business that you are running which would then largely dictate the other factors. The next factor is the size of your business which could mean the type of system that you would need to have in place as well as the budget that you can spend in setting up the system. And lastly, the users which would include the number of personnel that would have access to the inventory system as well as their proficiency in performing. Let us now take a look at the options available for you:
FIrst up is manual inventory with pen and paper – If it worked for civilization for a few hundred years, it should work now right? Wrong. Back then they did not have the number of consumers and products intertwining at a rapid pace. Today, you could not step out for a second without going back to a host of new changes in technology that you would not believe. So, unless you are running a lemonade stand, manual inventory just don’t cut it nowadays.
The next option is to use general software which includes office databases and spreadsheets. There are quite a number of businesses that still resort to this form of inventory management and most have had great success. The benefit of this is it comes with no added cost as most office software already comes with spreadsheets. The downfall is that this is still prone to human error, not as much as manual, but still quite susceptible.
The last option and probably the best one is to install an inventory app. As you have probably already noticed, there is an app for almost absolutely anything. Inventory management is not spared and in fact has become a fixture in companies.
Starting a business with unclear inventory system are just as dangerous as starting out a business with no clear financial plan. It is not simply just an aspect that you can ignore.