If you’re a multichannel retailer, wholesaler, or ecommerce brand, keeping track of inventory can be a daunting prospect. Systems, processes, and technology are now available, though, to help companies streamline their supply chain. With the use of inventory control systems, you can efficiently and accurately track your merchandise.
This guide will help you understand what inventory control is, its importance, and its challenges. It will also provide tips for inventory control, and discuss some inventory control systems and techniques.
What is inventory control?
Inventory control, also called stock control, is the process of managing a company’s inventory levels, whether that be in their own warehouse or spread over other locations. It comprises management of items from the time you have them in stock to their final destination (ideally to customers) or disposal (not ideal). An inventory control system also monitors their movement, usage, and storage.
Inventory control means managing your inventory levels to ensure that you are keeping the optimal amount of each product. Proper inventory control can keep track of your purchase orders and keep a functional supply chain. Systems can be put in place to help with forecasting and allow you to set reorder points, too.
Inventory control can include:
Barcode scanner integration
Complete inventory counts
Keeping track of physical inventory with sales and purchase orders
Product details, locations, and histories
Reports and adjustments
The general goal is to maximize your profits while the least amount of inventory possible is sitting in your warehouse. Your business must do this without compromising customer satisfaction. While you can handle inventory control manually, there are automated systems that take the responsibility of managing your stock levels, and help eliminate costly human error.
According to the US Census Bureau, in July 2020, U.S. manufacturers and retailers were holding $1.33 of inventory for every $1 in sales. Effective Inventory control allows you to change that inventory/sales ratio for the better. Stationary stock does not do anything for your business or its bottom line. Make the most out of the precious space you have, while ensuring you always meet customer demand.
Inventory control vs. inventory management
While they both deal with aspects of inventory, inventory control is different from inventory management. Inventory control works with the inventory already in a distributor’s warehouse. It requires knowing what products are in your inventory and where it is located within your warehouse. It ensures the inventory remains in good condition and is organized in a way that minimizes cost.
Inventory management includes the business processes of product replenishment and forecasting. Management encompasses when to reorder products and how much product to order, to avoid either stockouts or holding too much inventory. It ensures that the right inventory is in the right place, at the right time, and in the correct quantity. You can achieve better inventory management when you improve your inventory control.
The importance of inventory control
The value of inventory control extends from cost reduction to customer satisfaction. Good inventory control saves your business time, resources, and money. Your company can have a significant gain in sales, but without control over your inventory, your business’s profitability will suffer.
Here are some ways inventory control is important for your business.
More information: https://www.brightpearl.com/inventory-management-system/inventory-control