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The Importance of Inventory Tracking

When starting a business, there are several important steps you will take during this process. In addition to finding a market segment, products to sell, acquiring needed equipment, and finding the right location, there are also the systems you need to run a day-to-day business. Systems such as payroll, time tracking, customer tracking, and inventory management are all of the utmost importance. 

Inventory Management The Basics

Keeping track of your inventory involves several small details beyond just knowing what you have in stock. Each item needs to be carefully tracked and assigned its own unique ID in your software system. You also need to track your supply chain and know when items are being shipped, where they are in transport, and when they should arrive. Other matters such as shortages, natural disasters, and industry changes are also of the utmost importance. Professional software such as Skyware Inventory Software can help you manage your business inventory concerns in an effective and organized way.

Using Your Inventory Software Effectively

When selecting inventory management, you have options to choose from, and many offer several useful features to make use of. Here are some features you should consider implementing when setting up your inventory management system. 

  • Properly Labeling Stock Items: a key aspect of an effective inventory system is labeling and subdividing the items your business carries. Clothing, for example, is too broad a term. However, a more specific labeling system that tracks brands, designs, and colors is far more effective.
  • Measuring Stock Count: this can vary depending on the type of items your business carries. Some items can be tracked on a per-item basis, while others may be more effectively tracked based on cases or pallets.
  • Location Tracking: many tracking systems allow you to divide your inventory based on location. If you own a single business location there may not be much detail needed in terms of location. But if you have multiple locations or make use of offsite storage such as a warehouse then being able to keep track of your inventory based on location can be quite practical.

Inventory Management Best Techniques

Once you have an inventory management system in place and properly fine-tuned you can then use it to improve your overall business methods. Some of these techniques include the following:

  • Forecasting: once you can carefully track inventory and sales, you can predict what your future inventory needs will be more accurate. Cross-referencing past sales alongside industry changes, trends, and overall economic factors can allow you to avoid over-purchasing and also missing income by not being able to meet customer demands due to inventory shortages.
  • Identify Low Sale Items: when tracking stock you can also keep tabs on items that don’t sell very often. With low-sale items, you can reduce your stock to an on-need basis, clear out the old stock with sales, or discontinue it entirely if it does not fit your overall goals.
  • Real-Time Stock Tracking: keeping day-to-day track of your stock allows you to proactively respond to any inventory needs. This can allow you to respond to customer needs and also avoid any unforeseen surprises.  

Final Thoughts

Running your own business is very demanding. There are many aspects you have to carefully manage to be successful. Inventory is one of the most important things as ineffectively tracking stock can have a notable negative impact on your business. Problems that can arise include stock shortages, buying too much stock leading to a loss, not knowing where your purchased items are, and shrink due to not knowing how much of a given item you should have on hand. By implementing an effective tracking system, your business becomes far more effective and responsive to business needs.  

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