There are good, better, and best methods of doing just about anything. For instance, when it comes to quickly traveling from one location to another, walking is good, biking is better, and driving is best. We’re going to take this same approach when talking about inventory management.
You’ve got to learn to walk before you run. A good inventory management method for startups is often simply using a pen or pencil to write notes on a notepad. As long as an entrepreneur is able to make sense of their handwritten notes and their inventory isn’t huge, they may be able to make this work.
Sometimes good is perfectly adequate, especially when your needs are relatively small. As a company expands and matures, its leaders and warehouse workers will most likely discover that this basic method is not able to keep up with their requirements. As a result, they will need to move on to something better.
A tool helps you to do more than you could by yourself, even if it’s a simple tool that still requires a lot of manual effort on your part. In this case, we’re talking about an Excel spreadsheet.
Just as a bike is superior to walking because it more efficiently uses a rider’s muscles to propel them forward, spreadsheets are superior to handwritten notes because they help businesses to better organize and manage their inventory quantities. You can either use a premade Excel inventory template or create your own. This method relies on a digital system instead of a purely physical one, which is certainly an improvement. However, it is limited by the fact that Excel is not designed primarily for inventory management, nor is it able to be automatically updated as orders come in and inventory goes out.
That work will still have to be done by hand. There is one more option to turn to.
It is imperative for a company to do what is in its best interest. If the good or better categories are the best option at a particular time, then it’s fine to stick with them. But if the time has come to replace manual processes with a more automated approach, inventory software is the best way to make this happen.
Manufacturers can use it to track production stages, multilevel work orders, bills of materials, and more. Wholesalers, retailers, and other types of businesses can use it to monitor inventory quantities in multiple locations, print and scan barcodes to automatically update the system, integrate with other business solutions like QuickBooks to eliminate double data entry, and set up auto reorder points to speed up the task of replenishing stocks.
There are many other ways that inventory management software helps. The point is that it is able to get businesses to where they’d like to be in how they manage their inventory faster and more efficiently than either of the manual systems.
Your company’s budget and logistical complexity determine the good, better, and best way to manage inventory. You can use a pen and paper, Excel spreadsheet, or inventory software, as long as it is affordable and it offers the features you need to get you to your final destination: greater efficiency and profitability.