Inventory Management: Five Steps to Success

Many businesses believe that a good inventory software program will help them get a handle on inventory control. While it is true that a good inventory program will help a business, there are other factors that are overlooked that continue to plague inventory control management.

Many companies are losing sales because the merchandise is either not in the store or the figures in the computer inventory program are not accurate. Often, companies have the inventory in a warehouse, but have failed to get it to the sales floor. Even if an inventory control software program is well designed, the company must look beyond the software in order to maximize its inventory control procedures 

Here are five things a company should consider as part of their overall inventory control procedures.

First, organize the inventory warehouse. Make sure each inventory item has a specific location assigned. Then, make sure all incoming inventory is placed in this location. Set up quality control procedures to ensure: 1) only stock items are ordered unless specially ordered by a customer and 2) only authorized employees are permitted in the inventory warehouse. Theft is a major problem among businesses today.

Second, keep all paper work current. Every time an inventory item is added or taken out, a paper trail should track the process until the item is sold. That information should be quickly entered into the computer… preferably the same day, but in no case more than

Third, educate your employees. The better employees understand the cost of poor inventory control, the better. Losses from theft and damage significantly impact the net profit of the company. Spend time with those employees that have direct contact with the public. Good customer service can make or break a company.

Fourth, rotate and replenish your inventory. Set up a check and balance system to insure that your inventory stock is replenished as needed. Establish guidelines for reordering inventory by using minimum/maximum quantities, seasonal items, etc. Be sure to regularly train employees on the procedures for moving your inventory from receiving to warehousing to purchasing. When inventory is not selling, put the inventory on sale

Finally, document every step of the inventory process management procedure used by the company. Update the information as needed. Make the management of your business inventory a continuous part of your business planning strategies.  

About The Author:

Larry Andrew is an educational consultant, author and publisher of www.ez-software-review.com. Learn how to purchase cheap, reliable and quality software for your home, school and business.

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