Software to Support Inventory Management at Small Businesses

Savvy small business owners know when to use tools to make life easier, including inventory management software. But what is inventory management software, what problem does it solve, and how do you choose it?

The Problem: Local Businesses and Inventory Management

Small businesses face a number of challenges when it comes to inventory management, many similar or identical to those that larger businesses face. The issue is that small businesses may not have the resources to overcome these challenges like a larger company would.

The following are some of the biggest inventory management challenges for local businesses:

• Lot tracking issues: Lots are groups of products with similar characteristics, whether that’s the source, expiration date, or another factor. Lot tracking involves labeling and tracking, a task small businesses don’t typically have the resources to do.
• Inconsistencies in inventory levels: There are plenty of opportunities for inconsistencies in inventory levels, such as differences between items in the system and those on the shop floor or in the back. Local manufacturing businesses may also have inconsistencies between the manufacturing numbers and inventory.
• Irregular inventory inspections: Inventory inspections are a good way to minimize inconsistencies, but some small businesses don’t practice these regularly. If you have too many tasks to perform, inspections can get neglected.
• Infrequent internal audits: Just like inspections, internal audits must take place regularly, but they can sometimes be skipped, given the bulk of operational tasks that comes with small businesses.
• Supply chain coordination: Depending on your budget and suppliers, it can be hard for small businesses to coordinate the supply chain well.
• Over-reliance on spreadsheets: For small businesses looking to cut costs, spreadsheets are a popular tool for inventory management. But you can quickly end up with dozens of spreadsheets that are disorganized and inconsistently updated. This solution is also not scalable.
• No strategies: Every business needs to be prepared if an issue with the inventory arises, such as those inconsistencies. However, small businesses don’t always have a plan in place.

The Solution: Inventory Management Software

Nearly all the inventory management challenges that small businesses face can be overcome or improved by inventory management software. The best inventory management software can automate many of the functions and help you keep better records.

Simply put, inventory management software is a piece of software that automates various tasks related to managing the inventory and warehouse. This inventory software streamlines the tasks you need to complete to track inventory and handle reordering. With a good inventory management software, you can easily check the status of your stock at any time.

What to Look for in an Inventory Management Solution

Since numerous inventory management solutions are available, it’s crucial to learn how to choose the right inventory software for your business.

Inventory Tracking

Start by looking at the inventory tracking available in the inventory software. This will be the primary purpose of your system, so you need to make sure it can meet your inventory management needs.

Barcode Scanning

One of the most efficient ways of updating information in the inventory system will usually be scanning barcodes. So, always look for inventory management systems that support barcode scanning.

RFID Capabilities

RFID tags are the other most efficient method of tracking your inventory with your inventory management software. RFID compatibility is common in advanced inventory management systems, and it can save you a great deal of time.

Low-stock Alerts

The inventory management software should let you set up low-stock alerts when your stock drops below a given level.

Automated Reordering

Some of the best inventory software options not only give you low-stock alerts but let you set up automated reordering. You set the limit for automated reordering to occur, and then the system will make sure you never run out of that item.

Purchase Management

You want to also be able to manage purchases in the inventory management software, as this is closely related to inventory management.

Reporting Features

The best inventory management software should provide useful reporting. You want to be able to see trends, like changes to stock levels, information on sales, and items that need to be ordered. Reporting in your inventory software lets you plan your future orders and what items to keep in stock.

A Mobile App

Choosing a system with a mobile app adds a great deal of convenience to your inventory software. This is especially true for small business owners who may need to check their inventory when away from their physical store or warehouse.

Data Security

Your inventory management software will handle sensitive data about funds, your stock, and more. As such, the best inventory management software will be secure.

Compatibility With Other Tools You Use

It goes without saying that any system you use should be compatible with other tools, including your inventory software. Just some of the integrations and compatibilities to look for include shipping, eCommerce platforms, marketplaces, accounting software, point-of-sale systems, and more. Make a list of what compatibilities you need from the best inventory management software before comparing options. 

Ease of Use

Look for an inventory system that doesn’t have a steep learning curve. Whenever possible, opt for something that doesn’t require extensive training. The best inventory management software is intuitive to use. 

Cost

When looking at the cost of inventory management software, remember that you will have to pay more to get more features. Carefully consider your budget, as well as your requirements. The good news is that there are now plenty of cloud solutions, and those tend to be more affordable.

Support

Don’t forget to consider customer support as well. You want to be able to reach the support team if an issue with your inventory management system arises. It is also helpful if there are useful articles and tools to help you resolve issues before consulting customer support. So, the best inventory management software will have resources to help you resolve your issues yourself and good customer support if you can’t. 

Other Things to Consider

In addition to the above points, think about a few other aspects of your business when choosing small business inventory management software. 

Most importantly, think about the size of your business at the moment and your plans. If you currently have multiple locations, you will need software that supports this. If you plan to grow and open additional locations, you want software that can scale with your business.

You should also think about the software you are already using that may help with inventory management. This is where compatibility with your other tools becomes crucial.

Overall, you need to consider the requirements of your local business. Not every business will need the same features from an inventory management system, especially if you already use a system with some inventory management features. Remember that some companies may decide that a simple option is still a good inventory management system. Others may need more advanced inventory functions. Be aware of what your business needs, including specific advanced features. 

Happy Customers Lead to a Thriving Business

Why is inventory management so important? When your inventory is well-managed, your customers will be happy. Happy customers lead to a thriving business.

Are you wondering what else you can do to improve customer satisfaction and grow your business? Check out our Guide to Customer Retention.