It is important to evaluate your small business on a pretty regular basis, to ensure that you are on track to business success and keeping things within your budget. And one of the most integral parts of your small business will be your inventory management. If this isn’t done well, then it can impact the whole of the business. So think about how your small business’s inventory management has panned out? Do you have the right products that are available when you need them? When things are out of stock, have you been losing a lot of money? Likewise, have you lost money because of excess stock?
With all of this in mind, here are some things to think about and what to look for when it comes to making the whole thing easier. So here are some of the best practices that can help you to keep track of your stock. Some good inventory management software should:
- Help to reduce costs, improve your cash flow, and do what it can to boost the bottom line
- You can track your inventory in real time
- You should be able to help you to forecast demand of stock
- You can prevent product and even production shortages, which can help to save money
- You can prevent having excess stock and having too many raw materials in stock
- The software should be accessible right from your POS (point of sale) system
- You could optimise warehouse organisation, as well as employee time which can be so precious and does impact costs
Storage and Inventory Management
One of the things that you need to plan and think about is how you are storing all of your inventory. You need to think about the practical level of storage, and what will be put where. For example, the popular items are going to be better if they are more accessible, and the special items that need to be kept from damage, should be in a place that isn’t a high-traffic area. You could also think about looking into steel building kits if you need extra space, or are going to be working from home and need some extra inventory stored close to where you are.
Audit Your Stock
Even with a good inventory management software, then from time to time, you will need to count your inventory to make sure that you have different stock in and what you have in matches what your records think you have in. Small businesses do use different techniques, as there could be an annual check, as well as monthly, and perhaps single item checks and spot-checking on things. And on that note, don’t forget to ensure that your company is fully compliant, which you can check and monitor by implementing this internal audit software.
Remember Your ABCs
There are many businesses that find it helpful to have some tighter inventory management, particularly over any higher-value items. This can be done by grouping items into either A, B and C. Items classified as A are your big ticket items that make up the smallest percentage of your inventory, but they have the largest consumption value. The items grouped into C, are the things that are the least expensive, but they make up a larger percentage of inventory, and as a result, have the lowest consumption value each year. Any items in the B category are the items that are in-between.