Having accurate inventory data is absolutely essential to running a healthy business. And the only way to have accurate inventory data is to maintain accurate inventory records. You can try to do this manually, but you’ll find that papers and other notes can easily be lost and they can also be entered incorrectly or even forgotten about when done by hand.
A better way to ensure accuracy is to use inventory accuracy software. This software automates many business processes and allows data to be recorded, organized, stored, and analyzed with greater efficiency and effectiveness than any manual system could ever hope to do.
Inventory accuracy software lives up to its name by doing three main things:
- Eliminating double data entry
- Ensuring inventory records are correct
- Allowing for long-range inventory forecasts
We’ll go into greater detail about each of these points as we discuss the importance of inventory accuracy software and how it can benefit your business.
1. Eliminate double data entry
Inventory accuracy software integrates with other business solutions, such as QuickBooks, Xero, Amazon, eBay, Magento, Bigcommerce, UPS, FedEx, USPS, etc.. With the help of these integrations, changes made within the inventory accuracy software automatically get scheduled to be sent out to all of the other solutions it is integrated with. The opposite is also true. When a change is made in any other solution, it can be automatically imported into the inventory accuracy software and then sent out to every other relevant solution.
Why is this helpful? Let’s say you have accounts on multiple eCommerce platforms. You sell the same products on each of those eCommerce websites. However, if you don’t have inventory accuracy software, you will need to manually update each of your accounts when you make a sale on one of these sites, because they’re not connected. Your eBay account won’t reflect a sale made on Amazon. This can result in many problems if it’s not handled quickly. You may wind up with a situation where you have sold the same inventory items twice before you had time to update the available quantities.
Inventory accuracy software solves all of this by automatically updating every platform soon after a change is made to one of them. It also sends information on new sales to the accounting solution to be recorded in the general ledger and to generate the appropriate invoice. It can even integrate with a CRM to allow salespeople to enter and keep track of sales they make in the field and check inventory quantities in real time. And there are many other ways that these integrations benefit a business.
2. Ensure inventory records are correct
For many companies, a great deal of time is spent cycle counting their inventory on warehouse shelves. Cycle counts are physical checks of items in stock to see if they are accurately accounted for in the inventory records. Inventory accuracy software reduces this burden by keeping track of all changes in a company’s inventory as items move in and out of the warehouse. When everything is handled automatically and inventory is updated in real time, there is less need for constant vigilance in the form of cycle counts. It’s still a good idea to do them from time to time, but they won’t be as intensive or as often as they otherwise would be.
And this is just scratching the surface of what inventory accuracy software can do. With the aid of barcode scanners and other mobile devices, warehouse workers can instantly check inventory quantities, reorder items, transfer them, pick them, and accomplish other tasks quickly and accurately. Entering inventory data into a computer system by hand, or writing down inventory numbers with a pen and paper, has the obvious flaw of inserting a big risk of human error. A single typo or misstep when typing in data can lead to disastrous results. What if the item number isn’t correct or the quantity is off by a single digit? Seemingly small mistakes can produce big headaches down the road in the form of improperly fulfilled orders or misunderstandings about how much inventory is currently in stock.
Scanning barcodes is a much safer way to ensure inventory records are correct. There’s no way for a typo to creep in when a barcode gets scanned. Barcode scanners are fast and always offer the right information. With these tools connected to inventory accuracy software, a business is sure to enjoy greater efficiency.
3. Get long-range inventory forecasts
An additional benefit of inventory accuracy software is that it allows companies to peer into the future and get a clear picture of how to prepare for it. As a company sells products from year to year, their inventory accuracy software stores all of that data and helps them to spot trends in consumer behavior. Perhaps a business sells more of Product A than they do of Product B during the summer, but then things flip around and they sell more of Product B than they do of Product A in the winter. These seasonal trends can be taken into account and anticipated. Doing so will let a company avoid unnecessary carrying costs, by reducing the number of certain items at times when they’re in less demand and then increase the quantity of other products when they are in high demand.
In addition, companies can look at sales by location to get an idea of what items are their top sellers in different places. Then they can quickly transfer goods from one location to another, if there is a shortfall at one with higher demand and an overabundance at another with lower demand. Each location can be looked at as a distinct entity with its own unique inventory needs and trends. This opens up a whole new set of opportunities for inventory accuracy software to help with.
Inventory accuracy software helps you in these three huge ways, so that you will be able to save time and money both now and in the long term. Knowing exactly what inventory you have on hand and what you’ll likely need in the future is an invaluable competitive advantage.
Learn more about Fishbowl’s inventory accuracy software by signing up for a demo of the software today.