How We Chose the Best Inventory Management SoftwareWhether you work in manufacturing, retail or wholesale, or any other industry, your inventory is one of your most valuable assets, and inventory management is one of your most important tasks. At its most basic, inventory management is about making sure that the right products are in the right place at the right time, and at the right cost — doing so impacts your warehousing costs and your ability to fulfill orders and keep your customers satisfied. It lowers your risk of investing too heavily in stock that won’t sell and helps you plan ahead and take advantage of pricing fluctuations. Inventory management software makes sure that you’re handling this issue in the most effective and efficient way possible, especially if you are working with a program that meets your business’ particular needs. When we set out to identify the best inventory management software of 2020, we started by establishing the main features that provide the most value to today’s businesses.
Efficiency ToolsTo say that efficiency tools are an important differentiator for inventory management systems is somewhat redundant: after all, moving from a manual system to a computerized process is in and of itself the biggest leap in efficiency that a company is likely to make. Still, the way that an inventory management system goes about that and the efficiency tools that it includes can make a big difference in how big a difference the software will make. The most valuable features and tools that lend themselves to greater efficiency are:
- Automation tools that track inventory in real time
- Predictive data analytics
- Inventory optimization
- Mobile technology
- Quantitative and qualitative forecasting
Easy CollaborationFrequent stockouts make the entire organization look bad, and almost always leads to finger pointing between areas that should be acting as equal partners in their responsibility to keep your business operating smoothly and delivering products efficiently. Procurement, inventory and logistics need to work together to make sure that the company is keeping clients happy, and effective collaboration tools including team messaging software and cloud-based workflow and project management tools make sure that supply chains are reliable and deliveries are made on time.
Reporting and DataInformation is power, and the information that an inventory management software program compiles and presents can empower cost-saving decisions. Among the most important of these are sales reports, overall inventory importance, forecasting, inventory hits, and inventory control.
What Is Inventory Management Software?
Inventory can be many things, but at its most basic it is what businesses rely upon either to operate or their businesses or that they sell in order to make money. A business’ inventory is one of its most important assets, and keeping track of it and managing it is both important and tremendously time-consuming and labor intensive. Inventory management software eliminates the need to perform these tasks manually. It helps improve efficiency, saves time and money, and provides invaluable insights that further increase business success.
Today’s inventory management software is available in generalized forms and in highly specific applications that focus on business type, industry or type of inventory. New technologies permit it to be housed and operated in the cloud so that information can be synced and updated in real time. Tracking via barcodes and radio-frequency identification allows inventory items to be tracked whether it is raw materials or finished goods, on the way to a manufacturer or to a consumer. At its best, inventory management software not only provides centralized information and workflow streamlining, but also quickly generates accurate data that a business can use to reduce its costs, boost its sales, respond to change, and improve customer satisfaction.
Benefits of Inventory Management Software
Every Inventory Management Software program has its own focus, philosophy and unique features, but all are meant to bestow the same overall benefits for business operations. These benefits are:
- Manage your inventory more easily while saving time and money. As inventory and need for inventory shifts, so too do stock levels. Inventory management software helps to spot and respond to trends, eliminates errors, improves communication and collaboration by automating and centralizing the process. This complex technology simplifies the process.
- Minimizes the risk of overselling, stockouts, and excess stock. A well-managed inventory is a balancing act. Too much stock takes up room and represents unnecessary expense. Backorders result in unhappy, disappointed customers and can have a significant impact on your business’ reputation. Inventory management software syncs your orders and inventory across all sales channels and warehouses to prevent this from happening.
- Inventory management software eliminates many costs that result from human error. It can establish partnerships and notifications that shorten supplier lead time, reduce excess and obsolete stock, and reduce man-hour costs by automating processes.
- Better understanding of your business position. Inventory and order management software tracks your supplies and provides real-time information that can help you forecast and plan better and negotiate with suppliers and distributors from a position of strength. It can help you understand what items are popular and which are not, improving your customer traffic and perception of your business.
What to Look For In Inventory Management Software
Every business is different and has slightly different operational processes, and the same is true of inventory management software. Choosing the one that is best for you will require an honest assessment of your company’s needs and a commitment to doing the research needed to identify the option that serves those needs the best. It is easy to get distracted by bells and whistles and features, so keep the following list of essentials in mind when making your decision:
- Cost. There are programs that are very affordable and others that are extremely costly. Though the features offered by high-priced packages are remarkable, and valuable for the businesses that need them, there is no reason to pay for features you won’t use. Keep your business and its budget in mind.
- Ease of Use. A software program is only effective if it is usable. Choose a program that is easy to learn and has intuitive navigation which will boost your chance of it being used to its fullest capacity.
- Reputation. There are hundreds of inventory management software programs available, and there are plenty of reviews that have been posted by those who have already invested in and used each of them. These are remarkably valuable and can serve as a guide as to usability, value, customer support, and other indications of whether a program is worth your trust.
- Reports and Analytics. In addition to features and functions, the data provided by inventory management solution software may provide its greatest value. Before investing make sure that the reports included in a program match the information that you need.
- Integrations. If you utilize applications to run your business — whether for sales channels, shipping, business processes or anything else — you will want to find a program that easily integrates with them so that your software can transmit information back and forth with it, saving you time and effort.
- Multiple Location Inventory Management. If your business operates out of more than one location or warehouse, you need to make sure that the tool you choose will centralize information for all of them.
- Customer support and training. No matter how easy a program may seem to use, you need to make sure that customer support is available, whether to address your own questions about functions or how to use the product, or to address glitches and technical problems.
The Cost of Inventory Management Software
The price of Inventory Management Software is based on numerous factors, including the features that each program offers, the reputation and maturity of the software developer, the payment format that the vendor has in place and the number of users/volume of usage that an individual company needs to have using it. This means that the question of how much a program costs is really up to the person who is going to be purchasing it, what their budget is and what their priorities are. Because the software is likely to save you time and money, you also need to put a value on that factor and then find a program that is going to cost you an amount equal to or less than the return on your investment.
The bottom line on purchasing inventory management software is to choose a program that is going to deliver on your needs and its promises. If it does that, saving you time and money and providing you with valuable business insights, then the importance of what you spend will pale in comparison to the value it provides.