4 Steps in Successful Inventory Management

August 21, 2016

Successful inventory management can help make your business operations very easy. Getting your finances and loan aspect right all starts with a good inventory management.


While you can regard this as one of the most boring aspects of your entire business, the very success of your business might hinge on doing it well. Inventory management is that aspect of business management that most entrepreneurs don’t want to spend their time on.


When you want to evaluate the worth of products or inventory that your business has in stock — whether for the sake of securing a loan or to balance your books, the value of inventory management is always later appreciated. While most businesses owners who can afford an inventory manager can keep their hands off any inventory-related tasks without feeling guilty about it, small business owners need to acquire better inventory management practices.


The following steps will help you manage your inventory successfully.


Quantify Your Inventory


The first step in a successful inventory management is to quantify your inventory. Putting the stock your business holds in numbers can help you put a lot of future hassles to rest on time. When your business begins to run low on cash and you’re being forced to stock up your inventory on inadequate funds, taking an inventory loan is usually the right step. But without quantifying your inventory beforehand, approaching a financial services company for an inventory loan may be difficult.


Services that offer inventory loans will often examine a prepared document detailing your company’s inventory records and holdings before granting a loan.


Keep Easy to Use Documentation


Keeping an easily understood inventory documentation can make all your inventory related affairs smooth, making the entire management of the business convenient for you. When you run into inventory related problems such as miscalculations or conflicting bookings, your documentation will help you get things in order.


Documentation can cover several aspects of inventory management such as products stocked, refunded goods, damaged goods etc. In essence, your documentation can also serve as your back up to inventory management tools and software.


Track and Respond to Market Trends


If your business relies on constantly changing trends, you need to regularly keep up with the market trends and respond by changing your stock quickly. For businesses in this category, market trends determine the sales — and this affects how your inventory moves. Tracking and responding to what changes are occurring in the market by moving out slow-selling inventory in favor of inventory that are in demand should be your first response strategy to market trends.


Use Tools and Software


Technology has made a lot of business operations very easy to handle. This does not leave handling inventory behind. By taking advantage of the development latest technology such as tools and software that provide businesses with seamless inventory management, your business is set to experience an itch-free inventory and accounting management.


What type of tools could you consider? While sophisticated inventory management tools may not be your thing, there are very reliable accounting software from established industry leaders like Intuit and Mint that you can use.


Some great examples include QuickBooks and PeachTree.


What strategies do you use to make your inventory management effortless? Does it make your business operation easier? Share your ideas in the comments.

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Author: James Jorner


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