An inventory management system is a complex structure that allows all sorts of businesses and other types of organizations to keep track of their parts, products, and other assets. It can be used by all sorts of organizations, from the smallest startups to multi-million-dollar corporations. Not every organization needs the same kind of inventory management system because the needs of a large corporation are different than the needs of a small business.
Because of the fact that no two businesses are the same and there are even gigantic gulfs between the functions and features that these businesses need, there must be different kinds of inventory management systems that can best fit their requirements. There are four main ways to manage your inventory, so let’s look at each and see which one will work best for your business:
By Hand – Startups often manage their inventory by hand in the beginning because they don’t have a large amount of products or orders to deal with. However, as their operations get larger and more complicated, they often turn to something a little more powerful.
Spreadsheets – Microsoft Excel is a useful tool for small businesses. It allows you to input a great deal of data in one place. But Excel spreadsheets are basically clean slates, and it’s up to you to make them useful by setting up formulas to make sense of all the data. That is a lot of work for a temporary solution.
Accounting Software – Some accounting software solutions (like QuickBooks) provide a limited number of inventory management features. This is an improvement over Excel, but it still isn’t a permanent solution because as small businesses grown into midsize businesses they often find that they need even more functionality to handle multiple locations and other new challenges.
Inventory Management Software – Fishbowl is a popular manufacturing and warehouse management solution that offers a highly customizable feature set to small and midsize businesses for an affordable price. It’s easy to add new features to it (like barcoding, manufacturing, warehouse management and more) so you can keep using it for years instead of having to learn new inventory management software every few years.
Even if you have used inventory management software for years, it does not mean that you can never move on to something different and potentially better. As a company grows, so do its inventory management needs. For example, you do not necessarily need to keep managing your inventory by hand or in Excel spreadsheets, especially if it would really boost efficiency in your business processes and accuracy in your inventory data if you were to automate at least some of the data entry and sharing across multiple solutions.
For example, you can integrate Fishbowl and QuickBooks together to eliminate double data entry. When a sale or order is added to Fishbowl, it can be scheduled to automatically be transferred to the general ledger in QuickBooks. That ensures your inventory and accounting records match up perfectly and that every transaction gets documented accurately.
The ideal inventory management system depends on the requirements of a business. There are four main inventory management systems that are available:
- By hand
- Accounting software
- Inventory management software