Overseeing inventory across several channels (and oftentimes across a handful of supply locations, too) can be a daunting task. Tracking outgoing and incoming products—data that's often delivered in different formats by different channels—is critical. But it's extremely difficult if you, like many small business owners, resort to spreadsheets and piecemeal counting systems. Fortunately, inventory management solutions are here to help.
Small Business Inventory Challenges
One challenge that drives many small business owners to seek a better inventory management solution is the very acute need to manage inventory levels in the most accurate and efficient way possible. For example, a small business operator may be worried that she's underselling on a platform such as Amazon. Brandon Levey, CEO and founder of inventory management solution provider Stitch Labs, says that small business concern often boils down to something of a conundrum.
"'I can't risk overselling on Amazon, so I don't list all my products in Amazon. I'm constantly making sure I don't show zero on Amazon.'" It isn't an efficient—or very lucrative—strategy, and without a strong multichannel inventory management platform this continues to be a primary problem for many merchants.
Brian Sutter, director of marketing at Wasp Barcode Technologies, an inventory and asset tracking software provider, says there's another surprising barrier that keeps some small businesses from pursuing a more robust inventory management platform. "They associate automated solutions with larger companies, and they think they don't have the money to manage or invest in one," says Sutter.
Business operators may also assume that an inventory program is too complicated to install and to use. That Excel spreadsheet they're using now may not be perfect, but it sure is simple. "They find out that Excel in itself might be easy, but managing their inventory in Excel is not," Sutter says. Switching between multiple spreadsheets, managing pivot tables, and ensuring everyone references the most up-to-date version of each file is a time-draining chore.
Inventory Management Solutions: Features and Future Proofing
The process of manually updating inventory spreadsheets can be an enormous time suck—especially if you're tracking multiple supply locations as well as order points. Levey encourages business owners to look for a solution that updates and reconciles product counts frequently.
Look for "something that gives real-time or near real-time synchronicity between the different channels [you] sell on," he explains. And it doesn't matter what those channels are. One of the initial steps must be ensuring that the system captures all changes, regardless of origin, quickly and accurately.
Another important feature: the ability to turn that data into action. "Look for things that give you the data you need to make decisions," Levey says. Each small business will have its own priorities, but he says, "What reports do you need? What tools do you need? Where are you unable to make smart decisions for your business right now?" Depending on how you answer those questions, the right inventory management solution might need to include immediate alerting when your supplies reach a minimum level, or it might translate into a system that you can access through a mobile device.
Maximize your inventory software investment by making sure the system does as much of the work as possible. Sutter says one critical component for many small businesses is maintaining adequate supply levels. "The number one thing we talk to businesses about is setting minimum and maximum levels. Once you set those, you can run reports automatically when you hit those levels and the system will notify you."
This not only eliminates that unhappy surprise of running out of product, it also lets you avoid rush reorder charges and other unnecessary expenditures. Some systems can even generate a purchase order when a minimum supply level alert goes off, thus removing one more step from your team's task list.
A platform that uses some form of tagging, whether it's a location label or a product-specific barcode, can also reduce the workload employees must shoulder. It streamlines periodic inventory audits (also called cycle counts) and ensures similar products aren't mistakenly counted together.
"It doesn't have to be a big, long process," Sutter says of these regular inventory checks. By leveraging a barcode or tagging system, he says the process can go from consuming entire days to just a couple of hours, even with large inventories. "You'll find that, as you start doing it on a more regular basis, your inventory is going to be more accurate, and the less you need to do it."
Julie Knudson is a freelance writer whose articles have appeared in technology magazines including BizTech, Processor, and For The Record. She has covered technology issues for publications in other industries, from foodservice to insurance, and she also writes a recurring column in Integrated Systems Contractor magazine.
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