Managing a small business is no mean feat. Irrespective of whether enjoy doing what you do or not, there so many little things that need to be handled and most times requires your full attention. From managing members on your team, to ensuring client’s needs are met, to managing product inventory in cases where you keep physical stock, to tracking sales and monitoring overall company performance.
Product inventory control can be considered to be one of the most important part of a business, and as such it tends to consume a bulk of your time. Its importance cannot be over emphasized due to the fact that the associated risk is also very high. If one isn’t careful, you could lose a lot of money in the process.
In other to prevent such a scenario from occurring while managing your business, here are some smart inventory control tips suitable for small businesses that could help you effectively manage your product inventory.
There are quite a number of useful tips to help manage your product inventory. However, we would focus on those that we are feel are essential and fundamental to business growth.
1. Take advantage of technology
The importance of technology in every sphere of human life cannot be over-stated, as the day goes by humans are becoming increasingly dependent on technology. At the forefront of these technological advancement is the internet and application that make use of it. Human lives and the internet have become entangled together and taking advantage of the internet capabilities enables us to accomplish tasks that would ordinarily take days to complete in a few seconds. In business we have adopted electronic mails to exchange correspondence, instant messaging applications to send and receive text messages with your business associates, family and friends. Even the way we consume information has undergone enormous transformation, we have different social platform and news centric websites. Inventory management has also caught up with the internet revolution, applications like the EMERGE App helps you manage your product inventory and automates the entire inventory control process leaving you with less manual tasks to carry out.
For those who don’t know, EMERGE App is an internet web-based application which provides users with all the enormous advantages of web-based application in addition to managing product inventory and a simple accounting system. EMERGE App allows you to keep tab of your business on the go. The EMERGE App comes fully loaded with several other exciting features like its access control feature that allows you to create user accounts for different employees based on the department they belong to, either in sales, accounting or operations. This allows employee’s access to information relevant to their job functions alone.
2. Reorganize your processing procedure
Technology is only as effective as the underlying process that drives it. If your process is messed up, whichever technology you chose to adopt would not be able to deliver the required results. The best approach to tackling inventory control is to organize the processes in place to handle the inventory as soon as it arrives. Processing involves working on how new items are added to your inventory. If you are able to get the processing right, you would have successfully eliminated issues that lead to confusion like arrival dates, product expiration dates where applicable and product stock keeping unit (SKU) numbers.
The ideal approach to reorganizing your processing procedure is to establish a format for documenting products as soon as they arrive, and this convention should be followed every single time an order comes in, also processing should be done immediately the order arrives, any time gap creates room for error and lapses. Besides the less time a product stays before it is processed the easier it is to keep track of the product.
Daily audits and periodic audits are a must, there is nothing worse than thinking that you have a product in stock only to find out that the product is unavailable. Try as much as possible to ensure this situation rarely or in an ideal scenario never occurs.
Daily audits help to minimize issues from occurring and also tends to aid the monthly or quarterly audits to a large extent. Daily audits gives you the opportunity to cross-check and reconcile the entire goods that came in and left your inventory within a 24 hour period. This level of attention to detail helps to nip errors in the bud before they escalate. An error in count by a single unit can be tracked immediately it occurs and rectified accordingly. This helps to prevent large scale inventory issues from occurring down the line.
It is always a good idea to take stock of your inventory at regular intervals, you should always have an idea of the quantity of a product stocked in your inventory and you should also know where the product is located or being held. This helps to give you an idea whether your inventory control process is effective or not. The fewer errors or discrepancies you have the better your inventory control process is.
Proper auditing both daily and periodic helps to create a check and balance process which in turn helps to track your inventory control management process.
4. Identify your Inventory
It is essential that products in your inventory can be identified properly. Making use of labels and tags helps to properly identify the products in your inventory. There are basically two main reasons why labeling and tagging products in your inventory are important. The first reason is that tagging products allows shoppers identify the item’s price. Secondly, labeling products helps you to track products a lot easier and also hastens the checkout process.
The idea time to label and tag products in your inventory is when the stock is being received. It is important that you do not overlook this process. Ensure unlabeled products are not displayed on the shop floor and aren’t ready to sold. It is ideal that you incorporate this into your processing incoming inventory procedure. It should be stated that some products arrive pre-labeled, it is up to you to decide if you want to relabel the product or keep the manufacturer’s product label.
Asides tagging and labeling products, it is also important to note the time a product was added to the inventory and who received the product in inventory. If you operate a business that require frequent movement of product, ensure you able to identify each person who has handled the product. Each product should have its own unique identification number for easy identification.
Having detail information on a product makes it very easy to reverse track a product from the point of sale back to the shipment that brought the product.
5. Delegate authority in order for you to able to anticipate, plan and be proactive
It is always ideal that you set up a team of hardworking and smart individuals to help manage your product inventory. With a committed team, daily activities are achieved a whole lot fast and reoccurring errors are minimized.
Why am I stressing on this? If you intend to scale your business and grow faster, you have to be willing to delegate some parts of the business to other to handle. Once that is achieved, you can then play a supervisory role which involves mainly overseeing the activities of other employees. With your team of highly talented and motivated individuals focused on your inventory, you now have enough time to plan, anticipate and proactively deal with issues which may arise in other areas of your business.
You could start you planning my giving yourself an idea of where you want your business to be in the next year, three years and five years respectively. Projections are always important for every business if you are serious about growth. When you have multiple people who are experts in different fields working together, it whole process becomes a lot easier and effective.
6. Know your partners and clients
We have laid a lot of emphasis on tracking goods and product inventory in the previous tips. It time to focus on those who are stationed at both end of your inventory. They are; the Partners whom manufacture of sell the products you buy and the buyers or clients who in turn buy the products you sell.
This tactic is critical to smart inventory control, establishing a cordial relationship with your clients and partners means that you would have good delivered to you on time and they would always be customer or clients willing to purchase the goods you have stocked in your inventory. It ensures you have everything you need readily available and on hand.
Failure to effectively execute this tactic means you could be caught off guard, meaning you could get under-stocked and you might not be able to fulfill a client’s request. You not only loose potential income in the process, your credibility diminishes in the eyes of your customer based on your inability to deliver, and we don’t want that happening to us do we? Conversely, if you have developed a reputation for being able to meet up to high and expected demands from your customer’s, in addition to quicker turnovers, your credibility is enhanced and you stand to gain more customers in turn.
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