Automated inventory management

Kent Gigger
October 10 2023

Automated inventory management is an operational process that can be a time and money saver for small- and medium-sized businesses looking to take their business processes to the next level. Manual systems require tedious steps and repetition to ensure, as best as possible, inventory accuracy, and they pull employees away from other crucial business and operational tasks. Growth requires changes to the way a company operates. Automated inventory management could be the ticket to scale your company to the next level.

Manual inventory management methods

There are a number of manual ways to manage your inventory. For example, you can rely on your memory, do it all by hand, or use Excel spreadsheets. Let’s talk about the strengths and weaknesses of each of these.

Relying on your memory can work for startups that are small, one- or two-person operations. If you are the only one in charge of your inventory, you might be able to get away with not writing anything down, relying purely on your own experience to remember how many items you have in stock and which ones you need to reorder. This method is no longer viable when your inventory and employee base increase.

Doing it all by hand involves writing item names, serial numbers, quantities, vendors, and other information on a piece of paper. With this method, you don’t rely on a single person’s memory. Anyone can check the written record and make his or her own edits. This is fairly risky, though, because it’s difficult to prevent unauthorized people from making changes, stealing records, and even losing or destroying them.

This brings us to using Excel spreadsheets. Excel is a great tool for digitally storing and organizing information. You can transfer inventory data from a piece of paper to a spreadsheet and update it as needed. Excel formulas can help expedite updates, however, the data entry process can’t be automated. Someone will always have to manually enter new numbers as products are bought and sold. This can lead to typographical errors and other mistakes. Plus, there is no guarantee that the file will be safe.

An automated approach

Automated inventory management is accomplished with the use of inventory management software. Products, like Fishbowl, allow you to use tools to automatically update all things related to your inventory, like quantities, locations, accounting data, and reports. Core functionality of inventory management software includes:

  • Scan items in and out with a barcode reader to keep inventory records accurate
  • Set up automatic reorder points on items to prevent stockouts and overstocks
  • Improve your warehouse organization to speed up picking, packing, and shipping
  • Integrate with other business solutions to eliminate the need for double data entry

Scan items in and out – You can either buy a specialized barcode scanner or download an app to turn your smartphone or tablet into a barcode scanner with its camera function. Once an item is scanned, you can then generate purchase orders, cycle count inventory, receive shipments, and more. Using a barcode scanner speeds up everything by putting the right information into the palm of your hand, and it makes sure that the right items are scanned, so nothing gets entered incorrectly or misidentified.

Automatic reorder points – Automatic reorder points are a perfect example of automated inventory management. Rather than having to constantly check item quantities on the shelves, you can assign minimum quantities to each of your parts. When an inventoried item’s quantity decreases to a threshold you’ve determined, you will be notified. A purchase order can then be automatically generated with the proper vendor and reorder quantity listed, and all you have to do is issue it. You will no longer need to worry about accidentally overstocking or running out of a particular item. You can maintain a healthy balance with automatic reorder points in place across the board.

Improve warehouse organization – Do you have items in your warehouse that are often sold together? Storing those items in close proximity to each other can save time when picking orders. Are you unsure which items are most often ordered together? Fishbowl allows you to generate sales reports that will identify these items, as well as seasonal demand trends and other data points that will help you to adjust your inventory stock and the way you have your warehouse organized. Put complementary items close to each other on the shelves to make it easier to pick them, and place lower-selling items farther from the receiving area than higher-selling items.

Integrate with other business solutions – You can practically turn your inventory management solution into a CRM by connecting all of your crucial operational programs together, eliminating manual multiple data entry and the risks associated with working in disparate programs. For example, Fishbowl currently integrates with a variety of other business solutions that are in the following categories:

  • Accounting: QuickBooks and Xero
  • Cloud Data Storage: Dropbox
  • CRM: Hubspot, SalesForce, and Zoho
  • Ecommerce: Amazon, Authorize.Net, BigCommerce, CloverConnect,, eBay, Kinein, LilyPad, NetStock, Pepperi, SalesIn, Shift4Shop, Volusion, Webshop, X-Cart, and ZenCart
  • EDI: B2B Gateway, EDI Gateway, SPS Commerce, TrueCommerce
  • Manufacturing: SolidWorks
  • Merchant Services: Authorize.Net and CardConnect
  • Mobile Hardware: Andriod, Apple iOS, Brother, Unitech,  and Zebra
  • Operating Systems: Android, iOS, Linux, and Windows
  • Payments Merchant Services: Clover, Authorize.Net, QuickBooks Payments, PayPal, Square, and Stripe
  • Shipping: DHL, endicia, FedEx, NetStock, OnTrac, ShipRush, ShipStation, ShipWorks, StarShipIT, UPS, and USPS

Solving manual problems

Automated inventory management solves the problems presented by a manual approach, by limiting access to authorized users, automatically updating quantities when sales are made and new items are received, eliminating double data entry to increase data accuracy, and allowing information to be organized into a variety of reports for analysis.

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