Managing inventory may not be the most glamorous part of running a business, but it’s crucial, to say the least. Too often, business owners continue managing stock levels and product movement in spreadsheets long after the company has outgrown these tools.
When you use solutions that no longer suit your business, it’s like crippling your company and then asking it to run. As you grow, it becomes necessary to shed some of the old tools and invest in solutions that help you create a competitive advantage and enable real growth.
Inventory management software is one of the critical investments business owners should make if they want to have room to scale. It makes tracking your products easier than ever, giving you more control over your business.
Let’s dive into the benefits of inventory management software, the features to look for, and how to pick the right software for your business.
> What is inventory management software?
> Why effective inventory management matters
> Benefits of an automated inventory management system
> What to look for in your inventory management software
> How to find the best inventory management software for your business
> Final thoughts: What is inventory management software? + Top benefits
Inventory management software is a tool that provides visibility into your stock levels, gives you a way to order more items when needed, can connect you to additional sales channels, and lets you automate different parts of the inventory management process.
The software works by tracking your inventory levels so that you can see what’s going on with your stock at any point in time. Most providers also include features that help streamline inventory management activities, such as procurement and production, reporting, forecasting, selling and order fulfillment.
Before we take a closer look at the benefits of investing in the latest inventory management software, it’s vital to understand the importance of effectively handling inventory for your business.
At a glance, inventory management seems like a must-have part of operations — to sell products, you need to have them in stock. Seems basic, right?
In truth, effective inventory handling is a crucial success factor that touches all other elements of your business, from the customer experience to your finances.
To better understand its impact, let’s look at what can happen if you have inefficient inventory management:
In short, inefficient inventory ties your business’s hands when it comes to growth. Slow, manual processes can quickly consume your team’s time and lead to errors that push customers away.
If you want to set yourself up to scale your business, you need to think beyond the basics of inventory management and toward connected inventory performance.
Inventory performance includes everything within management, but it goes further to leverage automation, visibility, and data-based insights to give you a strategic advantage.
Let’s explore the benefits of leveraging inventory management software in a way that focuses on performance.
As the trend towards omnichannel shopping increases, access to real-time inventory data becomes vital for sellers.
McKinsey found that 81% of all shoppers research and browse products over multiple channels before they make a purchase. As a result, it’s more important than ever to create seamless customer experiences across your various sales channels.
With the right software, you can take the guesswork out of inventory tracking. Real-time visibility means you always know what items are available and where they are, ensuring your product availability information is always accurate and up-to-date to reduce issues like unfulfilled customer orders.
For example, Cin7 Core and Omni plans provide real-time inventory levels across all sales channels, including stock levels for e-commerce platforms like Shopify and Amazon. Not to mention, you can get in-depth sales reports that track stock movements so you know where your products are at all times.
Manual inventory tracking can be subject to mistakes, but you’ll get the correct numbers every time with reliable software. That’ll save you time and money since you won’t have to allocate resources to undo these mistakes.
Using software to track inventory gives you a better idea of what products to reorder, and the over- and under-ordering problems will be a thing of the past.
By implementing inventory management software, your business will become exponentially more efficient. You’ll have near-immediate access to your numbers, simplifying the process of ordering new inventory.
Additionally, you can spend less time preparing for meetings with vendors, as your figures will all be in one convenient place. You’ll also be able to fulfill orders more quickly and easily, improving customer relationships.
Lastly, by having a birds-eye view of your entire inventory process, you can analyze the efficiency of your warehouse locations and layouts. That enables you to identify opportunities to improve warehouse management and increase the overall efficiency of your entire operation.
You need to be able to evaluate what’s happening to your products quickly. What’s selling and what’s not? What’s in demand during certain times of the year?
Inventory management software makes it easy to track these trends and order your products accordingly. Over time, you can use this information to improve demand and sales forecasts and better predict how much stock you’ll need to support each channel at certain times during the year.
Two of the most important business relationships are those with your customers and vendors. Using inventory management software can solidify both of these vital partnerships.
Invoca’s Buyer Experience Report found that 76% of consumers will stop purchasing from a brand after one bad customer experience. Having better control of your inventory means customers can get the products they want when they want them.
It also means shoppers have access to accurate product availability information. Consistently delivering a positive customer experience enhances your brand’s value and creates more customer loyalty.
When it comes to suppliers, inventory management software gives you full access to your numbers when dealing with existing or potential vendors so you can approach deals confidently.
Moreover, being prepared and giving your vendors enough lead time to fulfill orders can establish you as a preferred customer, netting you access to priority treatment and better products.
Automating your inventory system makes growing your business and increasing revenues possible without piling on more manual work for your team. Since the software handles tasks like asset tracking and inventory data management, you can scale with fewer complications.
You can use features like stock alerts and reorder points to notify your team when it’s time to procure more inventory. This way, you’re not checking inventory levels every day, and you can still avoid issues like stockouts.
One 2023 consumer study by Mirakl found that 55% of products have been out of stock more frequently in stores. With frustrating stock levels becoming the norm, businesses that sell products in-store can create an advantage by managing inventory better and ensuring product availability.
With Cin7 Omni, you can fully customize your inventory management with features like native EDI and third-party logistics (3PL) integrations to accommodate the needs of your growing business.
When your stock levels aren’t optimized well, you end up paying the price. Whether it’s costs associated with storing deadstock or loss of customers from incorrect availability information.
You can avoid that type of spending when you have software that gives you real-time visibility into your stock levels so you can replenish items at the right times.
Another one of the benefits of inventory management software is it gives you the power to operate more cost-effectively in the long run.
By automating inventory management, you can reduce overhead costs associated with sales. Not to mention, you have access to inventory reports that help you make data-driven decisions that can lower your operations costs.
The perks mentioned above won’t do you any good if the features of your inventory management software aren’t up to par. Keep an eye out for the following features that support connected inventory performance:
Your inventory management software should help you purchase, store, and track all the items you keep in stock.
Look for features like barcode scanning. These eliminate the need for manual inventory tracking and give you real-time insights into your inventory levels. Not to mention, you’ll be able to locate your items across various locations and keep track of shipping, receiving, and transfers.
Managing multiple vendors can be challenging, especially if your business is growing. Choosing an inventory management software that helps you organize your suppliers’ information can reduce manual errors and make purchasing more efficient.
At the least, you want to be able to store each supplier’s contact and billing information in one place. Additional supplier management features include auto-fill for purchase orders and purchase histories for each supplier.
If you have multiple sales channels, your inventory management software must integrate with them. Specifically, look for software that integrates with your e-commerce provider and point-of-sale (POS) systems.
By connecting these systems, you ensure a faster customer checkout experience and have one centralized place for all of your inventory data. Cin7 comes with POS technology that integrates seamlessly with your inventory management system and lets you sell from anywhere.
Features that automate low-stock alerts and reorder points can help you streamline purchasing and ensure you always have enough items to meet customer demand.
Look for software that generates reorder reports so you can place all your orders simultaneously with enough lead time. That way, you can ensure that the new items arrive before you’ve sold out of your remaining stock.
Cut down on manual data analysis by choosing software that automatically generates inventory reports for you. The right software for you should have a combination of basic reports and customizable options.
For basic reports, look for:
When introducing any new technology to your business, you want to choose intuitive and user-friendly software. It shouldn’t be so complicated to learn or difficult to use that it creates more problems instead of solving them.
Be sure to compare providers based on their ease of use, customer support, and learning resources so you end up with a tool that your team can get the most out of.
To find the best inventory software, start by identifying the key features for your business based on your inventory performance needs.
For instance, if you sell in-store and online, you want to look for a system that offers POS technology and integrates with e-commerce platforms like Shopify and Amazon. Businesses looking for more streamlined fulfillment support might prioritize including warehouse management software (WMS).
Keep in mind that a small business’s inventory needs will look different from that of a global seller with both direct-to-consumer and business-to-business channels.
Once you’ve figured out what your business needs in terms of inventory control, look for a reputable provider that offers the functionality you want. For instance, Cin7 was named the best overall inventory management software provider of 2023 by Forbes.
Our two cloud-based solutions, Core and Omni, are built to meet the inventory demands of small and mid-size businesses
Cin7 Core provides a simplified yet comprehensive solution for small businesses looking to improve their inventory tracking with a solution that can scale with them as they grow.
With Core, you can integrate with your POS system and e-commerce platforms like Amazon and Shopify, letting you take control of your inventory. It also comes with more than 70 customizable reports giving you unprecedented insight into your inventory processes.
Cin7 Omni, on the other hand, is a top-rated choice for companies that need support for native EDI connections and third-party logistics (3PL).
You can tailor your Omni solution to meet your company’s specific needs and sell products online, in-store, and through wholesalers. It’s a powerful solution that connects your inventory, order fulfillment, and accounting workflows all in one place.
Inventory management software can prove to be a critical tool in today’s world, keeping your company on the cutting edge and ensuring success.
Save time, money, and sanity by streamlining your inventory management, and use this phenomenal technology to your advantage to put yourself at the forefront of your industry.
Using inventory management software to monitor inventory levels at all times and forecast demand can help you better manage your inventory to reduce overstocking and stockouts.
Inventory management helps you solve problems related to inefficient inventory handling. These can include difficulty scaling your business, costly manual errors, and over- or under-stocking.
You can also reduce data overwhelm when you use inventory management software. Using technology to generate reports gives you access to the most relevant and actionable insights without having to sift through spreadsheets to gather the information.
Small businesses may be able to use spreadsheet tools like Excel and Google Docs to manage inventory early on. However, these tools are not inventory management software. As your business grows and your inventory needs become more complex, it’s best to use software like Cin 7, which is specifically designed to manage and automate inventory.
That eliminates much of the manual work that goes into managing spreadsheets and puts your inventory on auto-pilot so you can focus on the activities that bring in new customers and drive revenue growth.
By using inventory management software, you can automate repetitive tasks and reduce the chances of manual errors affecting your inventory levels.
Automation can help eliminate some of the time-consuming manual work of keeping your inventory running. You can also integrate your inventory management technology with other tools like your e-commerce platform, POS system, and accounting software to streamline orders, fulfillment, and financial tracking.
Product companies have to innovate quickly in the coronavirus era. With increases in online shopping and demand for click-and-collect, retailers and wholesalers are doing everything from shifting their sales-channel focus to fundamentally changing how they do business.
Lost, obsolete or overstocked inventory drives up costs and destroys margins. Without inventory visibility, you won’t know your business is suffering until it’s too late.
Big corporations like Procter & Gamble and Unilever are getting better performance from their inventory through SKU rationalization, so much so that the process is now trending across companies of all sizes. But what is an SKU? Or, rather, what is a SKU? How do you even say it? SKU can be pronounced like the […]