Inventory management is an unusually diverse field. Therefore an inventory management system that fits like a glove next to one business, will not necessarily be particularly suitable for another. At the same time, there is a common denominator that runs like the second thread between all the inventory management systems. Whether it is a paint warehouse, a factory for manufacturing electrical products, or a huge supermarket. The intention is to strive to minimize the chance of human error. This is why in recent years more and more businesses, like businesses all over the world, prefer to manage their inventory using smart inventory management software. But you also need to know how to work with them. We have some tips that will put you in order and save you money.
Tip number 1 – Set a minimum quantity for each product in stock
Make your inventory management simpler and easier by setting a minimum quantity that must be in stock at all times from each of the products. When the inventory of a particular product is lower than the predetermined quantity, you will know that it is time to order another quantity. For example, if you have a beauty parlor or salon, you may want to buy in large quantities of acetone or castor oil.
The minimum quantity varies from product to product depending on the speed at which it is sold or runs out of stock. And also depending on the length of time you have to wait until new stock is received and many other factors, which also vary from business to business.
Tip number 2 – First In First Out
FIFO is the most basic principle in proper inventory management. This means that goods that arrived earlier (hereinafter: First In), must also be sold or used earlier (First Out). The FIFO principle is particularly relevant in the food business or in any business that deals with products with limited shelf life. In these areas, there is a misconception but very prevalent, according to which it is always worthwhile to sell the newest goods and not necessarily the goods that arrived earlier. But not only in these areas it is important to maintain FIFO, but also in businesses based on non-perishable products. If the crates that first arrived at the warehouse and were pushed to the back, then their chances of wear and tear are higher.
Beyond that, over time the product packaging may change and even changes will be made to the products themselves. Therefore, you would do well to maintain a proper flow of inventory. What enters the warehouse first or, for that matter, the cold room, leaves the customer first.
To work according to the FIFO principle, you need to organize your stock correctly and smartly. So that the new products will be inserted from the back and from the front only products can be removed.