How long do you or your employees spend on updating the inventory database on your excel sheets? Let’s take a simple example. Say you’re an apparel retailer selling across multiple channels. You have a hundred products, and each of those products has five different sizes. So you have five hundred SKUs. In other words, that is 500 entries on a spreadsheet.
Now, as anyone in the apparel industry knows, fashion is a volatile thing. Let’s be optimistic and assume you churn your stock over once in three months. So, you start by updating the spreadsheet in January. You’ll be adding new products to it in April, July, October, and January again.
In each of these months, you have some stock leftover from the previous quarter that you offer up on sale, and you also have new stock added to the sheet. So, at each point in time, you have close to a thousand SKUs to deal with. And this is just for a hundred different clothing items.
You also sell these same products across multiple channels, so you have to update your spreadsheet every time you make a sale on any one of the channels. At this point, you’re already seeing the need for a dedicated member to look after the inventory count alone.
Consider the fact that sales can happen at any point in time, day and night, and suddenly, you need a team that is dynamically tracking channel sales and updating the inventory sheet 24×7. Make one human error, and you’ll have to start with counting your inventory all over again.
Research done on SMB owners states that 55% of them said that using an inventory management software saved at least 5 hours a week. 16% of them said that it saved them more than a day’s work.
How are they doing it? What problems has an inventory management software solved for them? How can you use an efficient inventory management software to solve your unique problems?
Let’s take a look at the few inventory management tips to grow your business
Count Your Inventory At The Beginning
When you decide to move your inventory management to a software product, you will still need to thoroughly count your inventory the first time around. Do this exercise carefully and diligently, because these are values you will feed into the software based on which it will function. The accuracy of these numbers will decide how accurately your software performs in years to come.
This is also a good time to learn more about inventory management and explore options.
Counting inventory is surely tedious, but you know it is nothing compared to the manual updating you have been doing so far. With a software, every time a sale is made on a recognized channel, your inventory levels are automatically updated. A good product will also be able to handle returns for you and help you choose what to do with the inventory when a certain order is returned.
Pick A Software That Offers Multichannel Support
This is almost a basic necessity in today’s times. As a retailer, you would certainly not want to constrain yourself to sell on just one channel. Along with your online store, you may sell on a marketplace as well as in a physical store. Multichannel retail offers you visibility and gives your consumers the opportunity to buy from an avenue they’re comfortable with.
For example, someone may want to buy a product only after experiencing it in a physical store. Another person may not trust individual websites but would have no qualms purchasing from a trusted marketplace.
Naturally, the more the channels you add to the mix, the tougher inventory handling gets. This is why you need to choose your software wisely. One that offers multichannel support is almost always preferable. Ensure that your chosen software product supports inventory integration across marketplaces and stores.
Let Go Of MS Excel
Before newer kids got on the block, Excel was, without a doubt, the best way to handle number crunching of any kind. Indeed, once you have the Excel spreadsheet for inventory management in place, your only task is manual updating of all cells. But the fact that you are reading this means the pain of manual labor is eating into your productive time.
What are the disadvantages of using Excel for inventory management?
- Firstly, with MS Excel, you will never get real-time or up-to-date information of your inventory automatically. You will be required to sit and update each sale detail every time it happens.
- You might end up ordering for, or manufacturing parts twice, simply because you didn’t know you had them. This could be a case of human error, which happens a lot while handling a large inventory.
- Similar to having surplus inventory, you might also not be aware of some particular item being under-stocked. This will lead to you losing out on customers and diminishing trust in your brand.
- Without very effective communication, more than one person may end up updating inventory for the same order, causing errors to creep in.
- You can, in no way, track a particular item easily on Excel. You might have to go through numerous spreadsheets to check an item out. This is a huge waste of time.
But, Why Should You Switch Now?
- A cloud-based inventory management software gives you global access to your store. You can easily check out what the sales status is at your store wherever you are in the world.
- It allows you to have integration with other software products required in a store, like accounting software, integrating your store with marketplaces like Amazon, eBay, etc.
- You can have many other features along with inventory management, like order processing, invoice generation, barcode printing, tracking shipments, setting taxes, etc. when you use a software platform.
- When your business grows, you will be able to scale up the inventory management platform for the extra stock each time without getting drowned in existing data.
- Your data is secure as it is stored on a remote server and not on your system, which is prone to accidents and other unforeseen circumstances.
- There will be no need for installation of the software on your PC. You only need to pay a monthly subscription fee. This also gives you the liberty to unsubscribe at any point of time.
According to The Small Business Administration of the United States of America, poor inventory management is one of the top 8 reasons for small businesses to fail. And yet, 46% of SMBs with 11-500 employees don’t track inventory using a proper software platform.
Primaseller helps retailers with an efficient cloud-based inventory management software. We can also integrate your online and offline channels of sale and help you manage business operations easily. Check out how we can help by signing up for our free trial now!