Inventory management may feel like a small component of your bustling business. But the truth is, it plays a pivotal role in your operations and your profit margins. So, what is inventory management, anyway?
The definition of inventory management, for non-retail businesses, is the process of ordering, storing, utilizing, and tracking a company’s materials. Almost all business sectors, from construction and healthcare to automotive and design, relies on inventory management software to provide excellent service and achieve optimal profitability.
Common Inventory Management Challenges
Having an excellent inventory management system benefits just about every area of your business, while a poor inventory management system does the opposite. Here are the key inventory management struggles faced by business owners:
1. Overstocked items and stock shortages
A recent study found that reducing stock outages and overstocks can actually lower your overall inventory costs by 10%. We’d all love to slice 10% off our expenses, but if you’re not able to accurately assess your inventory levels…overstocks and outages are unavoidable.
Stock surpluses tie up your capital in inventory that you aren’t using. If you work with inventory that expires or becomes obsolete very quickly, the costs of overstocked items are even greater. Additionally, the storage space required for the overstocked items contributes to higher overhead costs.
The negative effects of inventory shortages are more obvious. First of all, your customer service is impacted as you are unable to fulfill demands as expected. Secondly, replacing an item in a pinch usually requires a marked-up purchase at a local store or a hefty rush-shipping charge.
Proper inventory level tracking also allows you to accurately bulk-order items, achieving a lower cost per unit without the risk of unused inventory.
2. Lost, damaged, or stolen items
Without a detailed inventory management system, it is nearly impossible to track an item as it changes hands in day-to-day operations. Construction contractors, for example, are likely to have several crews at several different sites using dozens of pieces of equipment each day. With so much going on, it’s not uncommon for items to be left behind at a job site, or even to “walk away” with an employee. What’s more, items and equipment can be damaged on the job with no explanation or accountability.
Meticulous inventory management is necessary to reduce or prevent these situations from occurring. With the right software, you can gain oversight of your inventory without babysitting each piece of valuable equipment.
3. Wasted time
You’ve heard the phrase “time is money”, and that’s never truer than when your business begins to grow. There is nothing more valuable than your time, which is why spending too much time on inventory management can feel like a waste.
The “inventory time drain” comes in many forms. Maybe you’re in your warehouse manually counting your stock for two days straight. Maybe you drove to a storage unit 2 hours away looking for something that was in your truck the whole time. Maybe you spent your day going store to store, looking for something you failed to order in a timely fashion.
Solid inventory management gives you more of what you need most: time. Time to spend face-to-face with clients, time to work on marketing, time to get out of your back office and into the action. Knowing where your stuff is and how much of it you have is a game-changer.
4. Costly inaccuracies
We all make mistakes. Some mistakes, like manually entering a UPC code into a spreadsheet incorrectly, can be chalked up to human error. Other mistakes, like miscalculating a project cost because of inaccurate inventory counts, are more serious. In fact, the average U.S. retail operation has an inventory accuracy of only 63 percent. Fortunately, many errors are preventable with the right inventory management software.
A modern inventory management system reduces inaccuracies at every step of the inventory process. For example, manual errors are prevented by allowing for barcode scanning. A project’s costs and time requirements can be more accurately predicted when you are certain of which equipment and materials you already own, and what needs to be ordered. You’ll spend less time searching for transposed numbers in your spreadsheets and you’ll be able to meet your clients’ expectations with confidence.
5. Difficulty getting employees to use your inventory management system
Even your most dedicated, capable employee doesn’t have the same concern for your bottom line that you do. Not to mention, most members of your crew are focused on executing their duties quickly and efficiently. These aren’t bad qualities, but they do cause employees to put less time and energy into complicated, cumbersome inventory management strategies.
For example, if your system requires employees to stop at the computer to update records each time they use an item, they are likely to skip the step if they’re in a hurry to serve a client. In this scenario, either your inventory management system suffers, or your customer service does. Without a streamlined process, you’re between a rock and a hard place.
How Effective Inventory Management Software Can Benefit Your Business
If your business is struggling with inventory management, we can bet you’re using outdated methods or inefficient systems. Here’s how Sortly’s must-have inventory management software features can solve your inventory challenges:
1. Replace old-school spreadsheets with intuitive, functional inventory management software
When it’s time to organize data, business owners go right to the spreadsheets. It seems like a great option, right? You can add tabs, customize your fields, search through it, but it doesn’t take long before the spreadsheet becomes your beast of burden. Here are the pitfalls of the inventory spreadsheet system:
- Ample opportunity for manual errors
- Tough and time-consuming to audit and analyze
- Doesn’t track changes over time: as you update quantities you lose valuable data showing how inventory levels have changed (daily, weekly, seasonally, etc).
In your head, inventory management is simple. You need the right amount of the right stuff, without running out, and you need to know where it is and who has it. Some software has a way of making that much harder than it needs to be.
But a great inventory management app should be a lot like your brain: easy to audit, sortable by location, and always up-to-date. You need inventory software that’s fully customizable and scalable, and super simple to use.
2. Coordinate multiple locations with integrated software
As your business grows, you’ll find your inventory spread across multiple locations and project sites. Trying to coordinate so many locations (and so many people) won’t just give you a headache, it will make your brain explode. Ok, maybe that’s an exaggeration, but these pain points are all too real:
- No access to real-time inventory: If you need to visit and audit each location yourself (or have an employee do it), you will spend the majority of your time with outdated records. Without accurate inventory counts, delays are inevitable.
- Difficulty synchronizing your strategy: Too many cooks in the kitchen can be problematic, but you may find yourself with a bunch of cooks in a bunch of kitchens and no clue how to get everyone on the same page. In an area of business where consistency is key, this causes major problems.
- Lack of locational analysis: Without modernized inventory management software, you miss out on valuable location-specific details that could hinder your operations. For example, is one location experiencing a higher rate of stock loss or equipment damage? Does one site need more or less of a certain item than your other sites?
The best inventory software is designed to help you keep tabs on remote and always-on-the-move inventory. Whether your stock is in storage units, garages, trailers or a good ol’ closet, you can easily sort and search by location to ease logistics and streamline your inventory management strategy.
If your business model benefits from knowing who has what, and what condition the item is in, the right inventory app can keep you informed. Track the user history of an item and document condition with photos and text.
3. Access a fully mobile inventory wherever, whenever
If your software requires a desktop computer for full functionality, you’ll run into a whole host of problems. You’ll have to spend a large chunk of your time stuck behind your desk instead of out running your business. Your employees will often be unable to follow inventory management protocol without delaying service to your clients. Out of the office and need to check stock levels or item locations real quick? You’re outta luck.
Your inventory app should be cloud-based and useable wherever you are, on whatever device you have handy. The best inventory app has full functionality on desktop, tablet and mobile. It goes where you go and works where you work. Employees in the field must be able to access the inventory using their smartphones—no special equipment required.
4. Use a barcode inventory system, without cumbersome equipment
Odds are good that most of the materials and equipment you use already contain barcodes, the best identification method around. Your software’s barcode inventory system should allow you to scan existing barcodes AND create unique codes and labels for any item that needs one.
Many barcode inventory systems require clunky scanners or other cumbersome and expensive equipment. Not only are they easily misplaced and annoying to haul around, scanners are obsolete. Opt for barcode scanning software that works on your phone and requires no additional equipment.
The best modern inventory management software allows you and your employees to scan existing barcodes, which improves accuracy and reduces time spent on inventory management. Or, you can create and print unique scannable labels and QR codes for equipment as needed. Best of all, there’s no special equipment needed—just use a smartphone to scan an item and learn more about it or update its status or location.
5. Find the right balance between features and simplicity
Even businesses within the same industry can have totally different inventory management needs. Any limitation within your inventory management software impacts your bottom line and your growth potential. On the contrary, some inventory management software can be overcomplicated.
A reliable red flag that your software might be overly complex is if it requires special training, lots of calls to customer support, and hours staring at the manual. Inventory management is intricate, but your software doesn’t have to be convoluted.
Choose an inventory app that won’t require any lengthy sales visits or a 100-page guide. There’s no reason to settle for anything that you can’t have up and running in minutes, all on your own.
With Sortly, a completely intuitive inventory management app, even your least tech-savvy employees will enjoy these must-have features:
- A visual inventory: Images help you think and plan. They help clients visualize your proposals. They help employees identify the right materials required for the task at hand, especially when many items have similar names.
- Customizable alerts: There’s no reason to run out of an item you need or to miss a warranty or service deadline. Set custom alerts so that you’re always one step ahead of your ever-changing inventory.
- Easy, beautiful and in-depth reports: Your inventory information is valuable in creating order sheets, audit lists, training manuals, or even gorgeous proposals for your clients. Export totally customized CSVs and PDFs with the click of a button.
How Does Sortly Work in Your Industry?
Sortly is an inventory management solution for just about any non-retail business, whether startup or enterprise. Scroll down to see how Sortly’s features adapt and scale for your industry:
Flexible, intuitive IT asset tracking software is hard to come by. Information Technology departments have unique inventory tracking needs, such as warranty alerts, trackability by user, and tools to monitor item condition.
A common challenge for IT professionals is the ability to track equipment remotely. Sortly serves as effective IT asset tracking software because it allows users to scan equipment themselves to check items in and out, and you can search for information about items by user. That means you’ll always know who’s using your company’s smartphones, tablets, laptops and more.
IT asset tracking software is most effective if it can be used on the go. Sortly’s mobile inventory app can be accessed wherever the IT professional happens to be. Managing multiple sites, dozens of users, and hundreds of IT assets is as simple as possible with Sortly’s IT asset tracking software.
Construction and Contracting
In construction and contracting, it’s a guarantee that inventory will be scattered across multiple storage locations and job sites. Without effective construction inventory management software, it can seem impossible to track so many moving parts, especially while you’re traveling from place to place as well. Wasted time tracking down items, lost money on equipment that’s gone missing, and unexpected stock outages mid-project are common construction inventory challenges.
Old-fashioned inventory methods like spreadsheets don’t hit the nail on the head (so to speak). Sortly’s construction inventory management software tracks equipment and materials in storage, on site, and on the go. That means you can keep an eye on everything your business owns, especially expensive items like copper wire and cutting-edge tools.
On tight deadlines, empowering your crew can be a huge time-saver. With Sortly, employees can account for used or incoming materials and scan equipment in and out themselves, with customizable mobile inventory app access. Plus, Sortly is so simple that anyone can use the construction inventory management software right away on their mobile devices.
Schools and Educational Institutions
Schools are filled with brilliant minds, but tracking inventory manually is… not so smart. Educational institutions face unique challenges because their inventory can vary wildly, from inexpensive kickballs to pricey Chromebooks. Plus, items or equipment are often stored and used in dozens of different locations.
Sortly gets every location and user on the same page when it comes to inventory management. Teachers, coaches, and even students can access app features (with customized permissions) to check items in and out. The condition of items can also be tracked within the app.
With no special equipment required and easy-breezy training, it takes just minutes to get everyone on board with Sortly. By making it easier for the busy professionals and students across your campuses to track inventory correctly, Sortly reduces mistakes and lost items, so you can earn an A+ inventory grade.
Healthcare providers put the wellbeing of their patients first, and all too often, that makes inventory management an afterthought. Who has time to count gauze pads when patients need help?
But inventory accuracy is of utmost importance in a health clinic because item shortages could diminish your capacity to care for a patient. Plus, stock surpluses impact your bottom line by tying up cash that could be better used otherwise, like hiring that extra part-time nurse you know your practice needs.
That’s where Sortly’s medical inventory management software comes in. Stop frantically searching spreadsheets and delivery slips to find out if an item is on hand… just check your Sortly app! Plus, you’ll be able to see who has checked each item in and out.
There are lots of ways to make your medical practice more efficient, but a solid medical inventory management system is the foundation you need to provide superlative patient care without compromising your business’s bottom line.
Learn how one network of health clinics used Sortly to get on top of their medical inventory and reduce inefficiencies.
Running an automotive business requires a lot of expertise in the shop…and a lot of time spent in the back office. But you can spend a whole lot less time behind the desk by implementing a solid automotive inventory management system.
Sortly solves a lot of common auto industry challenges. Enjoy accurate stock counts at the touch of a button enable more accurate service estimates. Rely on multi-site capabilities that reduce time spent on the phone tracking down parts. You can even set warranty alerts to automatically notify you of important upcoming dates.
Best of all, Sortly’s inventory app is crazy simple. You can save your brain power for your work under the hood, while Sortly takes care of the little details. Your employees won’t need to leave the garage for special training, either. Just download the app and start tracking.
Honk if you love easy inventory solutions!
Design and Home Staging
Design and home staging businesses share a common challenge: SO. MUCH. STUFF. If you can’t be everywhere at once to keep track of your inventory, you’ll need a phenomenal home staging inventory management system to pick up the slack.
Sortly works beautifully for design and home staging businesses because of its flexible and highly visual inventory app. Create custom fields to account for any item characteristics that you’ll need to reference, and upload unlimited images to ease your inventory searches.
Discover how a haunted house design company set the stage for success when they switched to Sortly.
Or find out how one boutique interior design firm relied on Sortly’s visual inventory, intuitive folder system and easy-to-access app to help their busy business run smoothly.
Ready to give Sortly a try? Get started with a free trial today!