Optimize Inventory with an Inventory Management AppInventory management software is making it cheap and easy for small business owners to see what's selling and optimize inventory levels.
Ordering just the right amount of inventory — not so much that you’re paying for and storing more than you need, and not so little that you don’t have what the customer wants — is key to most retail businesses. These days, affordable inventory management software is making it far easier for small business owners to stay in the sweet spot.
The apps, including the tablet-based NCR Inventory Management, can provide automated tracking of inventory levels, sales, orders and deliveries.
“With [many] solutions being cloud-based, small retailers don’t need large IT organizations to support the inventory management software,” said Robert Cuthbertson, vice president at Boston Retail Partners, a business consulting firm headquartered in Boston. “Advanced functionality that was once only available in high powered tier one solutions is available to everyone. Solutions are scaled appropriately to support the business and enable growth.”
Some apps run on tablets. They integrate easily with other tools, such as POS systems, business intelligence solutions and accounting apps.
Using an inventory app instead of a spreadsheet (or worse, pen and paper) can help you run your business more efficiently.
“Inventory management solutions help retailers see the big picture by providing the ability to look at where dollars are being spent or opportunities to avoid costs,” said Cuthbertson. “When looking at individual products and categories, it is easy to lose sight of the impact of purchases. With an inventory management solution, you can not only track inventory positions, you can model the impact of various decisions accordingly.”
Inventory management software can be especially useful to owners with complex operations that involve multiple locations or large numbers of SKUs, said Richard Wilding, professor and chair of supply chain strategy at Cranfield School of Management in Bedford, UK.
5 ways inventory apps can save money and boost revenue
Taking the guesswork out of ordering can save you money and increase revenue. Here are five benefits of inventory management apps.
Preventing stock outages. If you don’t have what the customer wants in stock, you potentially lose a sale — and, if the customer finds what he wants at another store, you might permanently lose the customer.
“Inventory management software helps to anticipate outages. It provides opportunities for retailers to buy back in to trending items,” said Cuthbertson.
Inventory software can alert you when supplies are running low. Some systems can execute purchase orders automatically.
Reducing stock overages. Over-purchasing not only ties up cash, it can clutter up back rooms and retail shelves. If you need to run a sale to free up space — or cash — you could take a loss.
“Inventory management software helps retailers analyze stock positions based on sales,” said Cuthbertson. “It can track issues via exception reporting. This is very useful in situations where a retailer is managing lots of SKUs.”
Analyzing sales and inventory trends. “Most inventory management solutions provide dashboards that can help identify trends based on actual sales while comparing them to plan,” said Cuthbertson. “This is very helpful for forecasting future purchases.”
Wilding noted that store owners can analyze historical data to help plan their purchases of seasonal items.
Eliminating poorly performing products. “If items are underperforming, they can be identified and eliminated from the assortment. This helps retailers move inventory dollars into better performing items to maximize sales,” said Cuthbertson.
An inventory app can also help retailers determine whether items need to be moved between locations. “Inventory management can be done at the location level or in aggregate,” said Cuthbertson. “At the location level, you can see trends and shift inventory accordingly based on how things are selling.”
Identifying stolen items. Retailers can compare inventory data with product in the store to identify lost or stolen items. These items can then be reported as losses on tax returns.
“Additionally, you can track returns, damages, etc. more easily so as facilitate financial accounting,” said Cuthbertson.