Inventory control is the process of ensuring parts and products remain in stock to avoid shortages, overstocks, and other costly problems. Inventory control might seem synonymous with inventory management, but it is actually a bit different than inventory management.
Inventory control focuses on cutting the number of slow-selling products a company purchases. This saves businesses time and money because they don’t have to spend lots of man-hours reordering and receiving goods that they don’t really need. Plus, they don’t have to devote precious warehouse space to hold those products, which cuts down on carrying costs and affords more room for faster-selling products.
Inventory management, on the other hand, focuses on quickly and efficiently reordering products. So if a company can get a discount or more favorable payment terms for ordering in bulk, they might be tempted to do so if they have a purely inventory management perspective. This can come at a great cost if those products aren’t really what a company needs at the moment. Stocking up on products primarily because they can be obtained at a cheaper price will most likely lead to more products spoiling and becoming obsolete, as well as creating an inefficient use of storage space.
By combining the approaches of inventory control and inventory management, you are able to protect against making rash decisions and you also avoid the pain and expense that come from overstocking on inventory. As its name suggests, inventory control helps you maintain control over your inventory levels so that you make the best use of your resources and avoid product spoilage and obsolescence. Products in stock get sold by their expiration date and before a new product comes along to signal the end of the older ones’ life cycle.INVENTORY CONTROL SOLUTIONS
There are several ways to maintain inventory control in your business. You can use:
Pen and paper systems and Excel inventory systems are inadequate for anyone but the smallest startups, so those are pretty much out the window if you have any kind of complex inventory control needs. There are numerous simple and advanced inventory control software solutions available for companies to purchase. With so many options, how do you pick the right inventory control solution for your business?HOW TO START
To find the right inventory control solution, start by answering these three questions:
Depending on what you sell, your priorities will be different. If you sell food items, you will definitely need to focus on products’ expiration dates to make sure you cycle through them quickly and have a high inventory turnover ratio. If you sell expensive electronic items, you will need to make sure you don’t overstock or else you’ll run the risk of the products becoming obsolete while waiting to be sold. If you mainly sell small, fast-selling items, you must make sure you have a stable supply chain and a good relationship with your vendors so you keep products flowing in and out of your warehouse(s).
Do you have inventory in multiple warehouses? Do you use QuickBooks, Xero, Magento, Salesforce, Amazon, eBay, and/or other business solutions that you need to integrate with? Do you use multiple shipping carriers for different types of deliveries? Do you need to print and scan barcodes with mobile devices? What features do you foresee you will need in the coming years as your company expands? These are the kinds of things you need to know and factor into your decision of which inventory control solution best meets your current and future needs. If you buy one that doesn’t meet all of your criteria, you’ll soon have to make a switch to one that does.
You need to establish how much you can afford to pay for inventory control software. Write down the cost of each solution you investigate, including training and software expenses, and then match up those costs to the time and monetary savings you will enjoy by putting them into practice. Calculate your return on investment (ROI) to estimate how long it will take for the software to pay for itself and continue saving you in reduced man-hours, carrying costs, and more far into the future. The higher the ROI, the better the value.GET CONTROL
After you have done all of this work answering these questions, the answer should become clear. An inventory control solution that tracks virtually any type of inventory, as well as offers extensive inventory control features at a price you can actually afford? Fishbowl Manufacturing and Fishbowl Warehouse fit the bill perfectly.
Fishbowl is an affordable inventory control solution that lets you track tens of thousands of parts and products in multiple warehouses. It is the best choice for small and midsize businesses because of its seamless integration with QuickBooks and dozens of other solutions, plus its flexible feature set and enormous library of training and support resources.
Sign up for a free trial today to get control of your inventory with the help of Fishbowl, the #1 QuickBooks inventory control solution!