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Importance of a Good Inventory System

In the wholesale distribution business, inventory control is highly essential and should be front-of-mind to make sure the business thrives. To make it simple, inventory control consist of having greater control over your stock.

Knowing what you got, where it is stored in your warehouse, and when stock is coming in and out can help you save money, do faster fulfilment of orders, and prevent any form of fraud. You can also rely on inventory control systems to calculate your current assets, balance your accounts, and let you have reports of your finances.

Taking complete control of your inventory lets you maintain the right balance of stock in your storage facility. The last thing you want is to lose a sale just because your stocks are not enough to supply the order, when this could have been prevented if you were aware of the number of stocks you got in your warehouse.

If your business keeps on experiencing inventory issues like backorders, incomplete orders, and so on, you run the risk of having them transfer to another provider, which means lost of sale. The main importance of having an effective inventory control system is it lets you provide better customer service, give you a better, more real-time understanding of the products that are selling and which ones do not.

Companies control their inventories with different methods. The most basic way to to use spreadsheets with multiple columns for item number, quantity, and product name. You can choose to have a column to subtract what you sell and ship, and you can also keep a log of returns and new incoming stock.

This is, however, a very laborious process that can be a pain as it is open to a lot of human errors, which is difficult to track because it would mean manually looking into who, why, and where the error took place, and can take a lot of time to accomplish.

This is where automation of inventory comes in handy. Basically, the more automated your inventory system is, the better as it lets you escape doing more paperwork. Service providers can give you a lot more convenience than doing your inventory process manually yourself, and there are lots of options to choose from. They can even let you integrate with enterprise resource planning (ERP) systems or any multichannel integration you might prefer to use.

Automated system also lets you use hardware like barcode scanners, barcode printers, and so on, to keep everything in check and to make sure your inventory data is updated in real time, regardless of how many customers are buying at the same time. Some are even designed to trach the location of a specific product within a storage facility, which easily helps when it is time to get the product and pack it for release.

In a very basic sense, automated inventory control system lets you enjoy the following benefits:

Increased efficiency

Since there is no longer a need to monitor the inventory manually, employees can concentrate more on other more valuable tasks to work on, and as previously mentioned, no need for a lot of paperwork.

Inventory mastery

You are given access to each stock you have and know where they are in the storage facility, especially if you have multiple warehouses in different locations. This also lets you avoid having you or your employees to constantly contact each other just to get updates on stock data.

Better customer experience

With great control over your stocks, customers can get their orders much faster and much more accurate. You can easily get the data of your stock if you have the product available or if you need to restock, which then makes it faster for your customer to get their orders because you can immediately tell them what you got.


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Jojo Balagosa

Jojo Balagosa

Sales and Marketing Manager at Jinisys Software Inc.
A software Consultant for hospitality and real estate solutions in the Philippines. General manager for sales and marketing for Jinisys Software. You may follow me on Jojo Balagosa
Jojo Balagosa

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