6 Reasons Why Inventory Management is Crucial for Businesses

6 Reasons Why Inventory Management is Crucial for Businesses

If you’re inadequately managing your inventory or not managing it at all, your business is likely suffering as a result. There are many benefits of inventory management, which can help both your customers and employees.

1. Increased Overall Efficiency

Employee efficiency can significantly increase your business’s overall health. Without adequate inventory management, you’ll pay your employees to spend time sifting through files, sending spreadsheets to one another, manually write all reports, or visit the warehouse every time there’s uncertainty regarding stock. Instead of wasting money on these tasks, you can avoid them altogether with a good inventory management system. Your employees will be happier if they can spend more time on necessary tasks that contribute to the company, and you’ll be more content with more accessibility.

2. Always Know Where Your Inventory is Located

Businesses with more than one location can suffer when employees need to constantly call each other to find a single piece of inventory, or confirm its presence. Accurately managing your inventory can help you avoid any problems regarding inventory location, including issues regarding tracking down one product that a customer wants.

3. Close Every Sale Possible

Inadequate inventory management can also lead to a loss in sales. There are many ways things can go wrong, such as when employees believe that an item is out of stock and inform the customer of this, only to discover the item later. Employees may also direct a customer to a certain location to find a specific item, only to discover that the location doesn’t have it. The more accurate your inventory management is, the more customer success you’ll experience.

4. Always Meet Delivery Dates

Many businesses can quickly develop a poor reputation if they fail to deliver items on time to customers when items aren’t in stock. In many cases, a lack of knowledge about where items are between the vendor and the store or warehouse can lead to late deliveries. With an accurate inventory management system, you can track your inventory at every step.

5. Change Vendor Order Frequency When Needed

The opposite issue of insufficient storage is having too much. Storage costs can quickly accumulate for many businesses, and many companies wind up putting on a big sale simply because they over-ordered certain items to make storage more manageable. It’s important to keep track of exactly how many of each item you have in stock, along with how much you have on order. Doing so can allow you to change order frequency as soon as you need to, which can help keep your inventory in check.

6. Make Re-Ordering Easier

Using manual Word docs to copy purchase orders can lead to inaccuracies regarding item numbers, currency exchanges, or item spec descriptions. Good inventory management will enable you to copy recent purchase orders and choose specific item numbers and specs from a simple dropdown menu to help avoid errors.

With these benefits, you can see why implementing a solid inventory management system is beneficial to your business operations. Even if your operations are small, automating your inventory management can go a long way in helping your business grow while maintaining manageability. You’ll be able to keep both employees and customers consistently satisfied, while at the same time you can remain happy about how your business runs, without any of the complications that can come with a lack of inventory management.

If you need help with inventory management for your business, Fapco, Inc. is here to help. Simply contact us today and we’ll get started on the integration of a complete, accurate inventory management solution for your company.

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