Thursday Handy Hint #2 – Do’s and Don’ts of Inventory Management

handy-hints

To a lot of companies, the fundamental part of their business is their inventory, which ironically receives the least attention and the lowest amount of resources.

Most will go .. BORING .. and yes, compared to a Friday night catching up with colleagues for a couple of snappy cocktails, it is very boring… but the sheer mention of Improved cash-flow, time saving, accurate figures, increased revenue & higher margin profits will get the business owners, accountants and financial controllers hearts beating fast. Mention mobile barcode scanning, mobile sales, and auto purchasing should make everyone else’s ears prick up. 

What is inventory control or inventory management? Inventory management is simply the monitoring or control of your stock from receiving to dispatch. Let me give you an example of a lead that we had, this business actually had conservatively estimated their loss in stock at over $10,000, simply because they could not remember where it was… this is poor inventory management. This would have paid outright for the software with a significant chunk of cash left over. Have you misplaced stock lately? 

Inventory management encompasses your entire business from purchasing, sales, accounting, warehousing. Have you considered exactly what your inventory is costing you, or is your business is overstocked with inventory that doesn’t move, is there a desk full of orders that no one really knows if they have been sent out, do you always get returns for incorrectly sent items, do you have serial#/Batch # or expiry dates that you cannot track? This is the wonderful world of Inventory Management. 

The one common factor is that each business is looking to improve is their inventory management, and they generally run into the same issues. We feel that it is our duty to bring these to light for all people to hopefully avoid the pitfalls others have made, so we have put together a list of top 3 things to consider when looking for and purchasing inventory management software. With the big <S> on our chest, we aim to clean up the streets of this injustice to the inventory in your business. 

1: Consider the long term for your business

Inventory management should be looked at with at least the next 5 years in mind, preferably 10+ years. Installing software for convenience or as a “band aid solution” will cost more money, stress and inconvenience over time. Think of what each department (for example sales, purchasing, accounting and warehouse) need from the software. A good starting point would be integration into your accounting software, freedom and mobility in the warehouse, sales department with access to the software on the road, accurately purchase inventory, barcoding, a wide range of reporting and the list goes on. 

2: Consider the after sales service

Today’s technology allows great things, including the ability to offer your product from anywhere in the world. The pitfall to this for inventory management is that each business is unique, products may be the same, but each business has its own uniqueness. Having access to training, support and maintenance are major considerations and should be one of the first questions asked.

For example, does the provider offer onsite training to familiarise your staff with the product, it may be a great product but if no one knows how to use it, it is useless.

What about support, the first 3 months at least are critical and without local support you might as well pack it up and get out the pencil and paper again.

Finally, the maintenance of the software. This is a big one, yet quite often forgotten about. Maintenance and upgrades to software is critical, they fix bugs, add features and do all weird and wonderful things. Does the software provide updates, and is it mandatory to get these updates.

3: Installation

There are 3 versions of software available currently; the first is the traditional method of installation which is a local server/computer installation. The second is the hosting version which is similar to the first but someone else has the responsibility of hosting a server on a big server farm and you remotely connect to this. The 3rd is this new buzz word “cloud” version.

We suggest investigating each of these, and considering your specific business’s needs, there are advantages to each of these installation types.

At Fishbowl Australia, we are a bunch of nerds who love talking inventory, we see all kinds from machinery to medicine, tortillas to turtles, and the list goes on.

Published by

Alan-Dean Simonds

Alan-Dean Simonds works at Fishbowl Australia and makes sure that everyone is knowledgeable about the popular inventory management software for Reckon (formerly QuickBooks) users. Dean enjoys playing StarCraft II, creating 3D animations and watching movies.

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