Choosing the right inventory management system for your business
Inventory management is one of the buzzwords of the day. If you’re involved in an industry that relies on reliable stock management to maximize profits, you’ll certainly have considered investing in an inventory management system to help with the process.
But how do you go about choosing between the many systems that are on offer? And once you’ve decided on one, how can you evaluate whether the inventory system you’ve chosen will actually be the right one for you and your business?
Here is an outline of the steps you should take to choose the right system:
Inventory Management System selection process
As with anything that is likely to result in a satisfactory business outcome, you should have a proper plan to follow. If you stick with the 4 step process we outline below, you can’t go wrong.
Step #1 – Inventory Management – Your requirements
This is the obvious first step to take. Though it’s surprising how many business people forget about it and go charging in to try and assess a system’s suitability for their circumstances without having defined what they need the system for.
When thinking about your requirements, you’ll need to cover all the various possibilities that are unique to your own situation. For example, you may have multiple stores around the country that need to be kept well-stocked on an ongoing basis, or you may have just the one outlet for your product sales.
You might make most of your sales online – thus requiring a suitable inventory system for your warehousing – or you might only have face-to-face sales within a store or via salespeople.
Bringing in other people at this stage of the process can really help you focus on the actual requirements for the system – e.g. salespeople, warehouse staff, buyers – who will all help you put together a well-designed set of ‘must haves’ that any inventory management system you choose will need to feature.
You may well want to add a weight to the individual requirements – based on what each person determines is the most important factor – so you can set real priorities for what the system has to include.
Step #2 – Maximum budget for your Inventory System
One of the key factors in determining the system you can opt for is going to be how much you can afford to spend on it. Be careful here, as you might simply say you want the cheapest option that covers most of the bases as outlined in the requirements stage.
However, it might well be that by choosing the cheapest option, you leave out a vital requirement that leads to a situation where you don’t have enough stock in a particular location at the time it’s needed. This is where having ‘weighted’ the requirements can really help out when choosing between the different systems available.
Step #3 – Inventory Management System testing
You’ll need to allocate sufficient time for testing the system/systems you decide on. It’s always a good idea to trial a service to see if it matches up to what you need and expects before you commit to spending your hard-earned cash on it.
Most reputable inventory system vendors will allow you to have a free trial before you start paying, so it’s well worth taking advantage of this to see how you get on with the system itself.
Step #4 – Persuading others that an Inventory System is necessary
Not everyone will be faced with this step, but from our experience, we know there is often a lot of reluctance to trial a new system – particularly among people who may feel their existing system relying on spreadsheets and their own memory is perfectly adequate.
All you really have to do to persuade someone that inventory management is the way forward is to outline the possible scenarios for things going wrong, while at the same time pointing to the efficiencies and increased profitability that come with having the right stock in the right place at the right time.
Inventory Management System Selection – Conclusion
So there you have it – a simple 4 step process for evaluating the various inventory management systems in the marketplace.
Follow the guidelines above, and within a few months, you’ll wonder how you ever managed without one.
Talk to an expert to help you match your requirements with an inventory management solution.