What is an Inventory Tracking System?
Inventory management is an important business function. You need to know what you have, what you need, and what you don't need. This is where an inventory management system comes in. An inventory tracking system is a system for tracking inventory items.
There are many types of inventory tracking systems. Some systems keep track of inventory by location, while others keep track of inventory by the vendor. You can use an inventory tracking system to track inventory in your restaurant, retail outlet, warehouse, store, or farm.
Why is an Inventory Tracking System Important?
You've probably had a few moments of panic when you couldn't find something you need, whether it's a screwdriver, a computer cable, or an important letter. It's difficult to keep track of all your inventory. You might have some items that you don't want to keep on hand for various reasons, and this makes it even more difficult to remember where you put what. That's why it's important to have an inventory tracking system. An Inventory Control system will help you remember where you put what and allow you to track what you have on hand.
An inventory tracking system is a necessary part of running a business. Inventory tracking systems or management software are a great way to keep track of your inventory levels. With a system, you can tell what you have, where it is, and what you need. Without a system, you may not know what to order or how much to order. You may also lose track of what you have and eventually run out of inventory completely. An effective inventory system can be as simple as a spreadsheet and as complex as a computerized inventory system. Irrespective of the method you choose, to keep track of the inventory across several outlets efficiently you might need to follow a few steps listed below.
Why an inventory management is important?:
1. It helps track the stock you have
2. It allows you to easily locate products for purchase and shipment
3. Re-ordering becomes simple and convenient
Inventory tracking can be complicated.
There are so many different ways to go about it, and no one seems to agree on the best way.
1. Organize Your Locations
Organization is very essential in an inventory management system, both for a small business and a large one. First, decide on a workable plan to organize your products and then start with labeling your items. Labeling becomes one of the important management features because without mentioning the name and location of your product you won't be able to track it.
Label each and every place in your store or warehouse, every aisle, row, column, and shelf. You may want to use the alphabet or numeric or a combination of both to understand which the exact location is. For example, if your store has five aisles with 10 shelves in each and each shelf has 5 columns, then you may use alphabets to label the aisles from A to E, numbers to label the shelves from 1 to 10, and again alphabets to label the shelves from A to E. This way you will have an exact location for each purchase order or product.
Plus, having sequential labeling will be easy for any new staff member to adapt to as well.
The next step after labeling is creating physical labels to highlight and distinguish each storage space. The offline organization makes the online organization much easier to follow.
2. Describe Your Items
Once your labeling system is completely ready you would have to come up with a labeling system for your products as well. Now if you deal with selling products to the customers then you surely have a lot of products in number as well as in their variety. It may sound time consuming but is not.
In order to identify the products individually, make sure of accurate inventory and that each description is unique to the item of sale. Separate your item labels based on their size, color, and type. To identify the products easily and to remember the labels without worrying you may want to match the labels with the descriptions mentioned on the product itself. This is a way of simple supply chain management in your business.
By following such a system your staff will also be able to track the products without much confusion. For instance, if your warehouse management stock contains Mom's Magic Peanut Cookies, then you can have codes for the brand name, the product type and the flavor too. This product can be labeled as MMPC1.
3. Number Your Items
There's one more way of tracking your products easily. Just number all the items present in your stock. This method is slightly faster and narrows your product search significantly. You can easily distinguish the size, color, and other product details.
If you run a store with your own product line, then this number management system will make Inventory Management far easier. You can simply continue with a similar kind of labeling process to avoid any confusion and to get rid of the hassle of coming up with new label types. When creating a number system for your labels it is highly important to have a crystal clear guide to make available for anyone who handles the inventory management system. This way you can save the time inventory training takes up for all the staff members when taking orders or tracking shipment.
Steps to create an inventory management system:
1. Organize your locations
2. Describe your items
3. Number your items
4. Measurements matter
5. Count your stock levels
Managing inventory is a pain, especially when you have a lot of products.
Inventory management systems are expensive and time-consuming to set up.
4. Measurements Matter
Labeling and defining the measurements of all the products you have in your stock is important. The measurements may change depending on the kind of product you're shipping and the way it is packed. You may have a number system to label the measurements of the products but still you will need a numbering system for the containers in which the items have been stacked. An example, if you are packing 200 ml bottles of a product in a container then don't forget to mention how many of them you put in a box.
5. Count Your Stock Levels
Once done with the organization and the labeling process, next comes the task of creating a system of keeping a count of your stock levels too. This last and final step completes your inventory management tracking system. You must follow all these steps once more to keep a detailed account on a spreadsheet or any management software for barcode scanning or keeping a real time track of your products. Put a count for all the items you enter in your data system and verify them closely. This makes your system workable and accurate right from the beginning leaving no room for human error at all. You will also be able to manage the Inventory Forecasting well with this system.
After you finish with these steps, you will realize how much the time spent with tracking methods saves so much more for business owners in future. Most Pos Systems like Plum POS come with best inventory management tools as an included feature while others provide this as an add-on. Some point sale systems also offer free trials of their software.
If you run a business, chances are you need to keep track of your inventory.
It’s hard to find an inventory management system that is easy to use and doesn’t cost a lot of money.