Keeping a close eye on inventory can help small businesses reduce losses and control costs. Using inventory management programs can help small business owners reduce the amount of time needed to do inventory counts and get more up-to-the-minute, accurate inventory information, allowing them to make better decisions about what they need and when they need it.
The primary benefits of inventory management software are cost savings, storage organization, updated data and time management efficiency.
An inventory management program can help small businesses reduce costs by eliminating excess inventory, reducing purchasing costs and the amount of storage space needed. It also helps businesses have an accurate gauge of demand in order to keep enough supplies on hand to avoid losing customers because of lack of selection.
The software can help small businesses by allowing them to optimize the efficiency of their warehouses by reducing excess stock and by letting them stock items that are often sold together in the same place and letting them stock popular items near the delivery area for quicker packaging and distribution.
The quick and accurate access to inventory data provided by thes programs provides a full picture to business owners that allows them to make well-informed inventory decisions.
Lastly, inventory software, aided by technology such as bar code scanners, can help businesses assess their inventory more quickly, allowing them to spend fewer labor hours on inventory needs.
The disadvantages of this software are its cost and difficulty of use. Inventory programs don’t often come cheap, and the cost involved is an investment small businesses should carefully consider. Also, inventory programs can be complex, and you will have to spend considerable time training yourself and employees on their proper usage.
There are a number of inventory management software programs available on the market. Choosing the one that’s most appropriate to your business is important to getting the maximum value from the software and keeping proper track of your inventory.
Recent research finds that more 50 percent of small businesses use Intuit software for their inventory management needs. A popular application among small businesses with light inventory is QuickBooks, which in addition to providing bookkeeping support also provides an inventory management tool for busineses that don’t use barcode scanners. The price is inexpensive compared to other programs and QuickBooks other uses make buying the program a good value. More advanced versions of QuickBooks cost more, but offer more options. For example, QuickBooks Pro can track 14,500 items, while the Premiere version of the program can track more than 1 million pieces of inventory.
Another excellent program for small businesses with large inventories is Visco Software for Importers. This software is compatible with QuickBooks and Microsoft Dynamics and can perform a number of complex inventory functions such as tracking shipments. It’s more expensive than less complex inventory programs, but the features it offers large inventory businesses, particularly ones that ship a lot of items makes it invaluable.
For small businesses that do a large amount of e-commerce, Santrio’s Open for Business is a cloud-based application that’s compatible with QuickBooks and provides order processing, management and inventory tracking functions. The program is also relatively inexpensive.
Making the right choice
When selecting an inventory management program, there are a number of questions you need to answer:
- How much inventory do I have?
- How will I track my inventory? Data entry, bar codes, etc.?
- What are my information needs with regard to inventory? Do I need up-to-the-minute reports or will just a weekly or monthly count suffice?
- Do I need to keep track with order processing and shipping as well?
- What are my current costs of keeping track of inventory, and will introducing an inventory management program significantly reduce these costs?
