Inventory management software is the new digital replacement for old hard copy record books and inventory sheets, but with modern solutions it can be so much more. Because inventory management software is such an essential part of running a successful business there are thousands of solutions to manage your inventory data. But with so many options, how do you know which solution to choose?
What it does:
Inventory management software is software which tracks your products and services through your entire supply chain, from manufacturing to end sales. It governs how you administer and handle inventory management for your business.
Any venture handling stock will need a system to accurately track and control it. Without it, you will be working on a case by case basis — and will quickly run into situations where your business is missing orders, overrun with information and spend hours of precious time searching for documents that you’ve already filed.
While you require an inventory management system, the one in which you choose is completely up to you. Since there are numerous systems you can use, ranging from simple approaches to comprehensive solutions, it is crucial to choose the one that best suits your business challenges and situation.
Perhaps the biggest advantage to adopting inventory management software is that it makes the procedure of handling your inventory a great deal easier, saving you time and money.
With continuing fluctuation in stock levels and supply and demand, inventory management software avoids the risk of human error by automating key business processes.
On top of this, if the correct software solution is chosen, it will automate and streamline other areas including ordering, receipts and forecasting future sales. For this it is crucial to correctly select a system which will integrate with the rest of your business, otherwise these and other features may not be available.
How to choose:
Selecting the right inventory management system depends on several factors, and often requires studying and analysing your current business. The following are four questions to ask when choosing inventory management software and your inventory management techniques. These answers will provide clarity on your solution and implementation.
1. What are your business challenges?
A good starting point in determining which solution is best for you is by assessing your business’s current needs and challenges. For example, have you outgrown an outdated inventory management or enterprise resource planning system? Are inventory levels unpredictable across your distribution networks, or are you exhausting stock earlier than you’d projected? Do you have the capability to track inventory, or do you need to upgrade your tracking so you know where units are at any given point?
Analysing these questions related to your current challenges will help locate the processes that need improvement and gauge the functions that your inventory management software must have.
2. Do you require a server-based or cloud-based solution?
While cloud deployment has been relied on for many years, many businesses continue to buy on-site server-based management systems. When researching different inventory management solutions it is important to consider if the solution is cloud-based or server based.
Do you require your own software and server on site, or are your current systems online and would you prefer cloud-based software to avoid large capital expenditures? The main way to determine this is to look at your budget, current accounting and CRM systems in place and your company information policies. A cloud based solution is often cheaper for SMEs but may not abide by the stricter data policies of a larger company.
3. What other CRM and Accounting Systems are you using?
It is crucial to understand if you have any existing systems that only work with specific inventory management software. This can greatly limit your selection of inventory management software. For example some CRM and accounting systems will only work with certain plugins. If you were running Xero accounting software it would be best to choose a system that integrates with this software such as Dear Inventory rather than an external solution like Zoho Inventory.
If you choose a solution that does not naturally integrate with your current systems it may be cheaper to purchase the initial software. It will however, cost you more time, resources and thus money to install, integrate and maintain such a solution.
4. What is your budget?
The pricing for inventory management systems can vary greatly, depending on the features you want, the customisation of the solution and the level of ongoing technical support you require.
Some systems offer a free trial of their paid versions, while others start as low as $25 a month. The more expensive solution will charge a few thousand dollars just to purchase their solution with an ongoing payment to maintain licences.
The right software will both suit your budget and do what you need it to do. Thus it would be wise to make an evaluation not based just on price but on functionality, features, scalability and quality. That is why it is very important to categorise features you would like to have and those that are critical to run your business.
The bottom line is, too many businesses will wait until they are faced with missed orders, damaged stock and overlooked opportunities before they think about investing in a long-term software solution. Inventory management software is designed to support companies of all sizes automate their processes and improve their overall operational efficiency.
Thanks to the automation achieved from inventory management systems, human errors are greatly reduced. The effect of this is wide-reaching, from increased profit margins, improved customer retention and fewer stock outs. Inventory management software will save countless hours and avoid additional spending, so you can focus more on your customers and achieving even greater goals.
Feel free to contact us if you would like personalised consulting for Inventory Management Software. We can help advise you on the best software solution tailored to both your budget and situation.