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The Ultimate Guide to Selecting Inventory Management Software
Accurate inventory accounting can positively impact revenue and profit, and selecting the right inventory management software becomes important. Selecting the right inventory management software is necessary for your business as it will help you track and control the supplies and stocks.
For instance, you can always keep the dreadful “out of stock” situations at bay, which could adversely affect your revenue and reputation in ways you cannot imagine. The inventory management software can even help to optimize and manage your inventory and sales.
However, you must consider some factors when selecting the software for your needs. This guide will discuss these considerations in detail. Let’s start by understanding some facts about inventory management software.
Benefits of Choosing the Right Inventory Management Software
The primary benefit of choosing the right inventory management software is that it increases operational efficiency and reduces the costs of running a product business. The software makes this possible by automating manual processes, improving inventory accuracy, and providing insightful reports that help identify gaps in the existing business strategy.
Let’s look at the benefits in detail of implementing inventory management software in your infrastructure:
- You get end-to-end visibility into the product’s life cycle as the software tracks its movement from supplier to warehouse and from warehouse to customer.
- The software automatically updates stock movement to prevent overstocking and stockouts. It reflects changes in real-time as soon as products are sold, relocated, or adjusted.
- Businesses can automate Inventory management processes, like currency conversions, pricing optimization, and inventory forecasting, using the software to minimize human errors and stress on employees.
- An all-in-one inventory management software can synchronize the data between all your physical storage solutions, allowing you to have real-time updates about inventory levels across all store locations.
- The inventory management software can be integrated, enabling your business to sell through multiple channels, both online and offline.
Some retail operation management software supports regenerating purchase orders based on optimal reorder levels and auto-populating information about products within seconds. However, the type of inventory management software you use depends on your needs.
Key Features to Look for in Inventory Management Software
You may find many inventory management software online, but there are several considerations to keep in mind when doing the same. There are certain factors that you must consider:
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- Real-time Inventory Tracking: When working with the software, you must manage your inventory in real-time. This helps avoid stockouts, optimize inventory, and improve customer satisfaction. It also means you must find a solution that keeps your inventory accurate across multiple channels.
- Automated Reordering: The software must be able to record inventory data to reduce the risk of human error and ensure accurate tracking of inventory.
- Multichannel Integration: You must be able to manage your orders, sync inventory with your eCommerce channels, and expand your reach with the inventory management software.
- Reporting and Analytics: These features help you to scrutinize the inventory aspect of your business. That is why your inventory management software must possess this specialty to analyze different reports to study the sales trend.
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- Barcode and RFID Scanning: These technologies can make inventory management easier for your business. So, you can achieve real-time tracking by combining these technologies with inventory management software.
- Warehouse Management Features: The software must be able to manage multiple warehouses in multiple locations, transfer orders, and also keep tabs on your stock. It enables you to streamline your warehouse operations and generate insightful reports to make business decisions.
- Batch and Expiry Date Tracking: This enables you to trace defective items back to the batch that it belonged to and also track the expiration of items.
- Supplier and Purchase Order Management: It enables you to manage sales and purchase orders and create packages and shipments. Several IMS also have features that enable you to send delivery updates through a single order management system.
- Customization and Scalability: The best custom IMS offers unparalleled flexibility, efficient integration capabilities, and real-time analytics to empower your businesses with efficiency and insights.
- Mobile Accessibility: This is an important feature that every software must possess to ensure you can access its features across all devices like laptop, mobile, tablets, and more.
- Multi-location and Multi-warehouse Management: You can eliminate complexities in managing multiple warehouses with inventory management software. It can act as your one-stop application to monitor warehouse activities across different countries.
- Accounting and ERP Integration: Your inventory management software must comprise modules that are integrated and could be customized to suit your unique warehouse needs.
Now, you must choose the software that fits your requirements. To do so, evaluating the software management providers is a crucial step which we will discuss next.
How to Evaluate Inventory Management Software Providers
Apart from looking for some crucial features, you must also keep certain considerations in mind when analyzing inventory management software providers. These include:
- Assessing Vendor Reputation: A good vendor will have an efficient reputation online. That is why you must check all feedback and testimonials before selecting the software for your needs.
- Customer Support and Service: A vendor dealing with inventory management software will offer efficient customer support and services. This includes chat, phone, email, and other training resources for customers.
- Trial and Demo Options: These options are common across platforms in today’s world. So, it won’t be wrong to try some free trials or request demos before purchasing inventory management software.
- Software Security and Data Protection: Ensure the software you choose provides efficient data encryption and secure handling of sensitive information. Regular backups and security measures protect business data from breaches or loss.
To choose the correct inventory software product, you must balance technical capabilities and services. This helps you achieve financial and operational goals. Let us discuss next how you can implement inventory management softwares. Understanding What are Retail Operations provides a foundation for identifying how inventory management software fits into the broader context of managing store activities
Types of Inventory Management Systems
There are usually four types of inventory management systems that a business should know to make optimal decisions.
- Perpetual Inventory System
This system tracks product and inventory levels in real-time. It provides constant updates about the number of items available in stock, the amount of products sold, and the inventory left over. It is perfect for businesses with a large number of products as it can easily help to avoid overstocking and stockout scenarios.
- Just-in-Time Inventory System
It is a method of inventory management that aims to reduce waste and improve efficiency. It enables suppliers to deliver products only when required. This method is most commonly used in the manufacturing industry, but it can also be used in other industries that aim to reduce inventory hold levels and associated costs.
- Economic Order Quantity Inventory System
In this system, the software or system calculates the optimal quantity of inventory to order based on different factors, like the cost of ordering and holding inventory, demand, and lead time. It is perfect for businesses that want to spend optimally on acquiring desired inventory levels.
- Materials Requirement Planning System
In this method, the software plans and manages the production and inventory levels. It considers different factors, such as demand, production capacity, and inventory levels, to ensure that inventory is available all the time.
While there are many inventory management systems available, most businesses prefer to use perpetual management systems. Also, there are different types of inventory control systems, like ABC Analysis, Minimum-Maximum, First-In First-Out, and rental inventory control systems.
Make the Right Choice When it Comes to Inventory Management Software
Inventory management software helps businesses manage their inventory levels, ordering, and tracking efficiently. It also provides your business with real-time stock updates and automates several other inventory management tasks.
Ultimately, the software can help you reduce costs and improve customer satisfaction. There is no denying that you will find several inventory management software online to fulfil your business requirements.
This means you must keep in mind certain considerations to ensure the software best suits your needs. So, go ahead, choose the inventory management software you need and get ready to transform your business soon.
FAQs
Q- Can IMS Integrate with My Existing Systems?
IMS integration depends on the specific system you are using for your business requirements. The best thing to do here is to ask the vendor about the crucial features of the inventory management software. This will help you check if the offerings of the software align with the requirements of your specific system. You may also ask the vendor to offer you a free trial to ensure the IMS integrates with your existing system.
Q- Can IMS Manage Both Physical and Digital Products?
Yes, inventory management software can manage both physical and digital products for your business. The software tracks stock levels, shipments, and order fulfilment for physical products. For digital products, IMS manages licenses, downloads, and usage limits to ensure proper control and availability.
