How To Manage Your Inventory Hassle-Free

Inventory management is a critical component of the daily operations of any business.

It involves keeping track of all the inventory within the business, including raw materials, packaging materials, intermediate goods, and finished products.

Inventory management ensures that a business has the right stock at the right time, and in the right quantities. It also helps you make wise stock-keeping decisions by knowing when to order more materials, how much more to order, and where to stock the excess.

Inventory management can be a hassle, especially when your company deals with numerous raw materials and finished products.

Even though some businesses try to use manual tools like excel sheets, they’re often less effective and create many gaps and data inconsistencies. Ask these business owners and they will tell you how manual inventory management inaumiza kichwa.

Consequently, most companies prefer to employ automated business management software that makes inventory management more effective and hassle-free.

Some crucial aspects of inventory management which become easy to track with an inventory management software include:

• Understocking
• Overstocking
• Profitability and movement analysis
• Stock aging
• Organizing stock
• Business integration

Understocking

Understocking is a common problem that occurs during stock-taking in most businesses.

Without a proper inventory management system, businesses often face understocking issues that impact the business operations for a reasonable period.

Understocking slows down the production process and can even bring the whole process to a halt. Not just the production process but a loss of sale opportunity.  Bringing in less stock not only wastes time, but also imparts unnecessary overhead costs to the business.

The best way to manage your inventory to prevent understocking is to do stock-tracking at all times to stay up to date with the available stock. You need to carry out regular stock audits to ensure that what you have in record is what is physically in the warehouse.

While some businesses prefer bi-annual stock audits, many carry out annual audits at the end of a financial year.

However, an automated inventory management system makes the whole process seamless since it helps you with real-time status when a material is about to go below the set reorder level, status and quantity that needs to be refilled.  This enables you to restock early enough to prevent downtimes resulting from a limited stock and understocking

Overstocking

Aside from understocking, it’s also possible to overstock, which may negatively impact the business.

When too much money is locked in on stock that’s not being utilized, it blocks the cashflow and also may affect the profitability of your business. Too much stock may also end up expiring, causing financial losses to the business.

When managing your inventory, it’s, therefore, necessary to stock just the right quantities required for uninterrupted production. Just like with understocking, the best way to avoid overstocking is to keep track of available stock levels and conduct regular stock audits.

This will help you identify a low-turn stock that hasn’t been used up in a long time and avoid adding more stock.

Manual inventory management systems may not be very effective in identifying overstocking since some stock may end up being forgotten or unintentionally abandoned.

On the other hand, an automated inventory management system like TallyPrime helps you analyze whether the stock is still available in sufficient quantities so that you don’t restock. It also provides real-time re-order level reports to help you make informed decisions when re-stocking.

Profitability & movement analysis

Conducting profitability and movement analysis is an inevitable part of effective inventory management.

Movement analysis involves tracking the flow of stock in and out of the store or a warehouse for a defined period, say monthly or bi-annually. This analysis enables you to identify fast-moving items from those that move slower and stay longer in the store.

It also helps you identify materials that bring in more profit within your defined period. Materials which move slower are likely to block cash flow for your business than those which move faster. Now, when applying the movement pattern and profitability analysis, you will be in a better position to know the stock that contributes steady flow of cash into the business.

Every business should perform movement and profitability analysis for accurate inventory planning and minimal financial blockages.

With robust business management software like TallyPrime, movement and profitability analysis becomes a walk in the park. TallyPrime provides movement analysis and profitability reports to give you comparative insights on the flow of stock.

With comparative reports like stock group analysis and transfer analysis, your business gets real-time inventory visibility, thereby helping make necessary stocking adjustments.

Stock ageing analysis

A stock ageing analysis is another crucial element of inventory management.

It involves the process of tracking the age and shelf-life of inventory to prevent losses that could result from dead stock. Overstocking is one of the issues that leads to dead stock. The cost of storage space and expired materials will significantly reflect on the profitability of your business.

Stock ageing analysis, therefore, helps you stay on top of your inventory ageing to prevent such associated costs. With a manual system, you must keep updating the records regularly as materials get used for production, which can be quite cumbersome.

TallyPrime makes stock ageing analysis easy by generating stock ageing reports to help your business understand which products stay longer in storage. It also displays the age of available stock and highlights old stock.

Additionally, the software  gives  real-time information  of items in stock that have expired or are about to expire.

Since keeping track of all this information is hectic with a manual system, TallyPrime makes it fast, reliable, and hassle-free for you.

Organizing stock in groups

One of the most efficient and time-saving ways to manage inventory is to organize available stock in groups.

Whether you’re using a manual system or an inventory management software, you can organize your stock in terms of:

• Product types
• Batches
• Lots
• Product brand or source supplier
• Physical characteristics like color and size
• Manufacturing and expiry dates

Organizing stock in groups gives you a better perspective of your inventory, making it easy to locate an item when needed. This saves time and makes your business operations more efficient.

It also helps improve visibility and transparency in your inventory management system.

Business inventory management software like TallyPrime enables you to organize your stock according to your preferences. For instance, you may decide to organize your raw materials according to the source supplier, while organizing the finished products according to their batch numbers.

With TallyPrime, you can effortlessly sort through the stock list and get all the information you need about a particular item. This streamlines the inventory management system and informs decision-making within your company.

Integrating with accounting software

Finally, managing your inventory becomes hassle-free if you integrate the inventory management system with other business management modules like accounting, payroll etc.

Robust business management software like TallyPrime provides you the flexibility to have all key features like accounting and inventory management, thereby enabling seamless business operations.

When these two or more modules work dependently, there is a consistent flow of information, and errors can easily be identified and eliminated. Integration also provides more visibility and increases the accuracy of generated business reports.

TallyPrime not only provides a convenient solution for inventory management but also other critical aspects like accounting, payroll, etc. Multiple modules can work together to give you a holistic insight into how your business is performing and thereby, help you make critical decisions affecting business growth.

Manage your inventory flawlessly with TallyPrime

Inventory management doesn’t need to be a nerve-wracking activity for your business.

This only happens when you try to do everything alone through manual systems, which rarely produce reliable results.

You can, therefore, punguza mzigo by utilizing robust investment management software to handle all inventory management for you.

From the stock summary, movement analysis, stock ageing, and item-wise profitability, TallyPrime provides you with real-time reports that let you see the daily status of your inventory. This helps you make informed decisions concerning restocking, purchase, sales, and other related business processes.

Make inventory management hassle-free by taking a free trial of the inventory management software today to see how it can make work easier for your business.

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