![]() ![]() Inventory software also provides the opportunity to keep track of the quality of any stock you receive from suppliers. A business mitigates this by ensuring a streamlined inventory organisation process where stock rotates throughout a storage or distribution centre. ![]() The longer a business has inventory in its possession, the more likely it is that an item becomes damaged. The more a business can track and manage different elements of its inventory, the higher the degree of quality control it can attain. Proper inventory organisation provides a good degree of quality control over a business's stock. Related: What are organisational skills? (Types and examples) Provides quality control Control of inventory also reduces the potential of having too much stock (overstock) or items that don't sell (deadstock), both of which may be costly for a business. A buffer reduces the risk of an item being out of stock, particularly if it sees a spike in popularity. Inventory organisation is vital for the proper functioning of a business, guaranteeing enough units to fulfil customer orders with a safety stock buffer. This element of management is important for helping a business understand the stock it has available, the orders it can fulfil and the speed at which it can access its stock. Having an organised stock room allows a business to make more informed decisions around their stock and identify growth opportunities. Below we explore some of the other reasons that inventory management and control are important: Encourages organisationĪ high level of inventory management demonstrates a wide range of organisational control within a business. While smaller businesses may manage their inventory manually, many larger businesses use automated inventory management software to reduce the chance of mistakes. It's important that a business can fulfil orders without compromising the customer experience. The primary goal of inventory management is to maximise the revenue of a business while keeping the smallest amount of inventory possible within the supply chain. Related: What does a stock controller do? (Responsibilities and FAQs) Why is inventory management and control important? Management of distribution and stock levels Reporting on inventory and the need for inventory adjustmentsĭetails and location of individual products Keeping track of any physical items that have purchase orders assigned to them The process of inventory control includes:Ĭomplete overview of inventory, including product counts Proper inventory management techniques allow a functional logistical chain while helping you track customer orders and forecast future demand. It's important to have a balance of stock in the business, as too little means you cannot fulfil orders, while too much can be costly to store. Managing inventory levels is a key element of this process, as it ensures a business has the optimal amount of each piece of inventory at any one time. This ensures the smooth running of the supply chain and prompt completion of customer orders, which is vital for any retailer. A business can use software to help manage the storage and movement of items and monitor which stage of the distribution process each piece of inventory is at. It involves the management of inventory over its lifetime, from available stock to purchase or disposal. Inventory control is the management of a company's stock within a wider supply chain. Related: What is supply chain management? (Definition and purposes) What is inventory control? In this article, we define inventory control, understand why it's important and explore the different types of inventory organisation systems. ![]() Fortunately, technology advancements and system optimisations mean that software is now available to help companies track, manage and scale up their supply chain. This can be a daunting prospect, particularly as the size of the inventory grows alongside the business. Tracking inventory is a key part of operations for any business that works in the e-commerce, wholesale or retail space.
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