If you plan on managing the storage and shipment of products for your business in any capacity, you’re going to need an inventory management system—and preferably one driven by software.
The advantages of an inventory management system are numerous:
- Automation not only saves time, but it minimizes the number of mistakes that can be made by human operators.
- Everything in your inventory management system will be formally documented, so you can go back and review it at any time.
- With everything collected in one place, you’ll know where all your products are at all times. This leads to greater transparency for vendors, retailers, and customers.
- You’ll also be able to analyze your inventory management performance over time so you can make improvements to your core processes.
And that’s just to start. The problem is, there are hundreds of inventory management platforms to choose from, and not all of them are equally beneficial.
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How to Choose an Inventory Management System
Use these criteria to choose the right inventory management software for your business:
Most inventory management platforms integrate into other software systems, such as your accounting platform or vendors’ tracking systems. Depending on what systems you’re already using, you may want to choose one that’s already compatible.
How much time and effort does it take to learn how to use the platform? How different is it from what you’re currently using? Obviously, any platform will require a bit of training, but you’ll want to minimize that impact as much as possible by choosing a platform that’s relatively approachable.
Different inventory management platforms offer different levels of functionality. Some will only track your inventory when it’s in your warehouse. Some will track it from beginning to end, including your supply from vendors. Others will integrate their functionality into a full-scale enterprise resource management system, which can help you examine other factors like employee productivity and profitability.
How often is the platform updated with new features and bug fixes? A platform that’s updated regularly is a sign that the company is committed to offering you the best and most secure product. Be wary of any product that remains stagnant for several months at a time.
Next, you’ll want to look at the customer service that’s available. No software system is perfect, so when you encounter a difficult question or a software malfunction, you’ll want to know that you have a reliable team of customer service reps ready to address your most pressing concerns. If you can, talk to some account managers and customer service reps at an inventory management software company before pulling the trigger. If not, be sure to at least consult the user reviews.
Is there a dedicated community surrounding the platform? If so, you’ll have a first line of support if anything goes wrong. It’s also an indication of the brand’s power and a sign that the product has some longevity. If a platform doesn’t have a thriving community of users, that’s not necessarily a bad sign, but having one can be a bonus.
What other equipment does this tracking system require you to purchase and manage? Many modern systems rely on electronic identification chips for scanning and tracking, at a minimum. You’ll want to be wary of any system that has too many moving pieces.
The Overall Cost
Finally, you’ll want to consider the overall cost of the system. Inventory management platforms can save you money in the long run, so they’re worth a significant investment. However, you don’t want to overpay for features you aren’t going to use.
Why It Matters
It may seem like all platforms are the same, or that your decision will only have a marginal effect on your business. The truth is, though, your choice in inventory management software could have a substantial effect on your operations, partner relationships, and even your profitability. One miscommunication is all it takes to compromise a relationship, and since your employees will be using this software every day for the foreseeable future, even a few minutes of time saved can add up to hundreds of man-hours over the long term.
Take your time when making your decision, experimenting with many different platforms and looking at it from every angle. Only make the final decision when you’re sure it’s right.