You surely would rather be focused on growing your business than worrying about running out of stock or time-wasting trips to resupply. That’s why it is so vital to have a reliable Inventory Management System in place.
We’ve found that businesses who don’t use an inventory management system have more than their fair share of headaches, including:
- Increased Costs – These businesses spend unnecessary amounts of money on items that will never provide a profit to the business.
- No Tracking of Inventory – Without access to real-time info, businesses don’t know how or where products move. This results in a greater risk of theft and inventory that becomes obsolete.
- A Lack of Inventory Balance – A lack of balance in inventory causes stock shortages and overstocking. Both scenarios can result in lost profits and costs that could have easily been avoided, via Consequences of Not Having Inventory Management.
On the other hand, here are just some of the top perks you’ll get when the right Inventory Management system is established:
- Increased Sales – Businesses who actively manage their inventory report a 2-10% increase in sales.
- Increased Information Transparency – You’ll have a clear knowledge of when items are received, picked, packed, shipped, kitted, manufactured, etc. Also, you’ll know when you need to order more, when you’re over-stocked, and when you’re under-stocked.
- Shorter Lead Times – Businesses who actively manage their inventory report a 50% reduction in lead times.
- Lower Costs – Effective inventory management practices help result in decreased inventory write-offs, plus lower inventory holding costs. Carrying extra inventory can be very costly to your company.
- Improved Overall Performance – Real-time inventory updates improve the flow of goods to customers.
- Increased Employee Efficiency – Good inventory management solutions save time. Less time spent on managing inventory results in greater productivity for you and your team.
- Accurate Planning – You’ll stay steps ahead of the game and always have the right number of products on hand by making decisions based on inventory trends. via Top Ten Benefits of Inventory Management.
Improve Your Cash Flow
Good inventory management saves money and improves cash flow. Inventory is product you’ve paid for, and you’re selling it for cash (checks and electronic transfers also count as cash). But when inventory sits idle in your warehouse, it is most definitely not cash.
A reliable inventory system creates an immeasurably useful foundation. Knowing how much product you have and how quickly you are selling it enables you to judge when you’ll run low and when to restock.
Knowing how your products move makes budgeting for future re-stocks easier and guards against losing sales to empty or low inventory. The data provided by a reliable inventory management system improves your cash flow by tracking product turn-over and forecasting future needs.
An inventory management system solves a lot of issues, but even a great system struggles with sudden shifts in the demand for product. To predict changes in demand and avoid headaches, pay attention to these details and adjust your system (and inventory) as appropriate according to:
- Market trends
- The health of the economy
- Seasonal circumstances (holidays, slow-downs)
- Guaranteed sales (contracts and subscriptions)
- Last year’s sales during the same week
- This year’s market growth rate
- Upcoming sales and promotions
- Planned advertising expenses
Learn how to grow your business with an Inventory Management System that fits your business and your budget.
Visit https://www.ew-ct.com/inventory-management-systems to learn more.