Inventory Tracking: What Is it & Tips To Track Inventory
The biggest challenge in running a profitable and productive eCommerce business is managing Inventory. You want to track your supply chain management accurately, but it becomes increasingly likely that you’ll encounter stockouts or delays without an efficient system.
The more your company grows, the harder it will be to Track Inventory. Keep reading and learn how to keep up with this process to streamline operations.
Inventory Tracking Definition
Inventory tracking is the process of monitoring all inventory items a company owns.
In addition, these software programs limit unnecessary theft by telling companies when their stock levels for every SKU go below a certain point.
3 Ways on How to Track Inventory
There are three inventory tracking methods, but most companies will use one. The best type for your business depends on what you need; however, automated systems are the most helpful for knowing where products go and how many there should be.
Spreadsheets can be a valuable resource for small businesses or startups with few products to track. If you are only dealing with one product, it is possible to manually add the SKUs in your spreadsheet and keep tabs on them by adding details like quantity.
As your business grows, it becomes harder to find the time for tedious spreadsheet work and manual inventory tracking. That’s why many companies quickly outgrow their static spreadsheets in favor of more dynamic means.
Inventory management systems
With inventory management systems, companies can track their products and how much they have on hand. This allows them to plan production cycles with accuracy.
Inventory management systems are an excellent tool for eCommerce merchants to keep track of their Inventory and help optimize it. The software can be set up with barcode scanners or RFID technology to track everything in real-time.
One way to avoid excess Inventory is by tracking your supply chain with an app. With this technology, you can keep track of product performance and make less risky decisions.
It will be easier to buy the right amount of materials with an inventory app for your company. This means that you can eliminate both stockouts and surplus products, which results in less spending on things that are not needed.
Why is Tracking Inventory Important: 3 Reasons
One of the most important aspects of a company’s success is tracking Inventory since, without it, many things can go wrong. By using an efficient system for your inventory management, you will have access to numerous benefits such as accurate data and reporting, which prevents losses due to too much or not enough product on shelves.
Always have enough stock on hand.
Inventory tracking is a crucial aspect of fulfillment and can provide insights into how your products are moving. This way, if there’s ever an unexpected surge in demand or seasonality-related dip in sales, then the Inventory that needs to be hauled will already have been tracked.
In addition to tracking Inventory, you should also be checking to reorder points and maintaining adequate buffer stock. If a customer is looking for an item not in the store or on your website, it can ruin their experience.
Accurate inventory counts
Another important inventory strategy is to take accurate stock counts, which are crucial for avoiding the pitfalls of poor inventory control. With advanced inventory management systems, your product tracking and order monitoring will be more precise than ever, thanks to automation that eliminate human errors or accounting inefficiencies.
A business that has an inventory tracking system can avoid stocking problems. You can tell exactly what you have in stock and when it will be delivered.
Don’t tie up too much capital in Inventory.
One of the reasons inventory tracking is so important is that it helps you avoid incurring excess costs. For example, if your products are not moving as fast as they should be, then there’s a good chance this will impact your bottom line. That said, one of the benefits of asset management software is that it can help keep you from tying up too much capital in deadstock or unmoved goods.
When you take a close look at your current Inventory and its movement throughout the supply chain, you’ll be better prepared to decide how much of an item is needed or when it should go on sale.
Three inventory tracking methods challenge
Now that you know the basics of inventory tracking, it’s essential to be aware of potential obstacles. If you have a plan for these things happening, everything will get back on track.
1. Managing inventory with many sales channels
It’s not easy to keep track of Inventory when your products are located in different warehouses. But, what most companies don’t realize is that the best way for them to make money and grow their business would be by opening up an online store with multichannel selling.
Managing Inventory with multiple sales channels can be challenging, as it is time-consuming and expensive to scale your warehouse management and inventory tracking processes. However, this does not mean that there is no solution; in fact, the help of sophisticated software may do the trick.
2. Getting to deal with returns
Returns are an unavoidable part of the eCommerce landscape but do not let them get you down because they happen to everyone at some point. Even after a customer has completed checkout and their order leaves your warehouse, there is no guarantee that the product will not be returned. It would help if you took care of returns quickly, or else customers may feel unsatisfied with the service provided.
When a customer returns an item, you can manually handle the return and refund it in person. But this is rarely your best option because customers have to wait for their money back, or they may not get what they originally wanted from that transaction.
3. Eats up time and resources
Once your business is on a steady trajectory and growing year-over-year, it’s common for inbound logistics to take up more of your time. However, this can distract you from the tasks that immediately affect company growth.
If you’re counting Inventory by hand, know that this process will take up time and resources because it’s a lot of work.
3 Best ways Inventory
Inventory tracking can be a headache, but there are ways to make it more manageable. Some strategies include improving the accuracy of your Inventory and reducing excess stock.
1. Utilize an inventory tracking system
Skubana is a company that specializes in the design of inventory management software. One way to avoid shortages, delays, discrepancies, and unnecessary costs from excess Inventory is with an innovative tracking system that Skubana provides.
There is no doubt that inventory tracking becomes more complicated as you add sales channels and warehousing options. Skubana can make sense of your multi-faceted business needs by helping to automate the process with better workflow and simplify supply chain management for improved results.
2. Make Use of data and inventory forecasting
Rather than relying on our gut feeling to decide what products are popular and which need more Inventory, you can take data from the past year’s sales to predict future demand. This means that if your current trend shows an uptick in customers interested in a particular product or item, then it will be easier for you to figure out how much of that product needs restocking.
Forecasting allows you to forecast inventory needs and predict what will sell. It also helps with inventory control by making it easier to track its stock.
3. Have frequent inventory audits
Inventory audits are used to ensure that the number of products on hand matches up with financial records.
One of the most overlooked ways to keep track of Inventory is regular audits. This can help you determine where your products are located and how many have been misplaced or mispicked, which gives you a chance to correct these problems if needed.