Many small to medium businesses that maintain an inventory often find themselves asking if they need a person who is dedicated to effectively managing their inventory. One of the terms used to describe such a person is an Inventory Management Specialist. We would like to help you understand a little bit more about this very important person and what a good Inventory Management Specialist can do to make your business more successful.
A PRIMER ON INVENTORY MANAGEMENT
Just so we’re on the same page, let’s define a few terms that will help us as we paint the picture of a great Inventory Management Specialist.
Inventory, to many small business owners, is one of the more important, visible and tangible aspects of doing business. Inventory may include raw materials for manufacturing or processing, goods or products in process, and finished goods or products. Each type represents money tied up until the inventory leaves the company as goods or products sold. Likewise, merchandise stocks in a retail environment contribute to profits only when they are sold. In a literal sense, inventory refers to stocks of anything necessary to do business.
Inventory management is the process of efficiently overseeing the constant flow of units into and out of an existing inventory—all of which represent a large portion of the business investment and must be well managed in order to maximize profits. This process usually involves controlling the transfer or movement of units (within a single location or between multiple locations) in order to prevent the inventory from becoming too high, or dwindling to levels so low that the operation of the company could be in jeopardy. Competent inventory management also seeks to control costs associated with the inventory, both from the perspective of the total value of the goods included and the tax burden generated by the cumulative value of the inventory.
Many small business owners fail to appreciate fully the true costs of carrying inventory, which include not only direct costs of storage, insurance and taxes, but also the cost of money tied up in inventory. Successful inventory management involves delicately balancing the costs of inventory with the benefits or end result of maintaining your inventory. This balancing act between keeping too much inventory and not enough is one thing an Inventory Management Specialist can do for your business.
THE INVENTORY MANAGEMENT SPECIALIST
Many small businesses cannot absorb the types of losses arising from poor inventory management. Unless inventories are controlled, they are unreliable, inefficient and costly. Having a person dedicated to managing inventory will help your business to:
- Maintain a wide assortment of stock—but not spread the rapidly moving ones too thin
- Increase inventory turnover—but not sacrifice the service level
- Keep stock low—but not hurt service or performance
- Obtain lower prices by making volume purchases—but not end up with slow-moving inventory, and
- Have adequate inventory on hand—but not get caught with obsolete items
An Inventory Management Specialist will help your business accomplish these objectives using many tools. Skill as a supervisor or manager and the ability to work with people is one very important aspect that cannot be overlooked or undervalued. Another very important skill, especially now in the technologically sophisticated and Internet or cloud environments our businesses compete in, is the ability to master and use inventory management software. The right software will make managing and accomplishing all of the objectives talked about above much easier.
The bottom line is your business will run much smoother with a dedicated Inventory Management Specialist who is using and mastering the right inventory management software solution. The direct benefits you will see in your business may include:
- You’ll increase revenues at the same time as developing stronger and more productive relationships with customers, prospects and vendors
- You’ll reduce stockouts and overstock
- Human error from double and triple data entry will be a thing of the past
Fishbowl is the most efficient and powerful manufacturing and warehouse management solution for small and medium businesses. It integrates seamlessly with QuickBooks, allowing your business to stay with the accounting software you are already familiar with. Fishbowl will give your business’ Inventory Management Specialist the best tool in the industry for managing your inventory and helping your business become more successful and profitable. Click the link below to learn more and to sign up for a free trial of Fishbowl.
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Inventory is often a company’s biggest expenditure, so it’s important to find a specialist who can properly manage it. An inventory management specialist should be able to use software to maintain stock levels, increase inventory turnover, and work with vendors to get good deals on incoming orders.