Running a retail business or a part of the business? You should have come across the darkest sides of the business, maybe earlier or even going through one at present. This has happened becauseyou missed something which is important for your retail business.
A retailer who started his business with a bang was not able to run it successfully in the later days. But he sooner realized the need for the business and recovered the sinking ship. Wanted to know how? Then you need to give this blog a read.
The blunder mistake that most retail businesses perform is losing track of what is available in their repository. This is where a business owner fails his business. He undergoes shortage of stock which further affects the smooth running of the business. This can be refrained from happening by using an effective inventory management system.
What is an inventory management system?
In the retail industry, a process that kept track of the goods and stock quantities both in and away from the warehouse is called inventory management system.
In recent times, inventory systems are managed using bar codes that makes work simpler and calculates the stock in the inventory just by scanning the bar codes. In common, these inventory systems operate along with a software unlike the ERP systems. This can also help you with building a personalized integration based on your business.
Some of the most important things that you need to know about inventory management system follows,
1. Safety stock:
Safety stock is something that you stock or store more than the expected demand. This is done to save you from running out of stocks especially during unforeseen changes that occur in customer’s demand.
Tracking in sense you track batches as a part of the quality control inventory management technique.This technique helps user to monitor the set of stock that is handled with similar features. This highly helps in keeping track of the expiration of the stock or replacing the defective ones from the batch to avoid shortage.
3. Economic Order Quantity:
The economic order quantity is the formula that calculates the standard quantity of the company requirements that it needs to purchase considering the list of variables such as the cost of production, demand, and various other factors.
4. Minimum Order Quantity:
The minimum order quantity is something which a supplier chooses to sell as a smallest amount from the stock he possesses. In case, if the retailer is not prepared to sell the MOQ of the product, the supplier would not sell it to you. This normally happens when the cost of the product is more than the expected prices.
5. JIT Inventory Management:
The best way to reduce the inventory cost is by using the JIT Inventory Management. The JIT is Just-In-Time inventory management technique that aligns raw material orders as per the production schedule.
This reduces the cost of the inventory and also avoids unwanted lose of raw material. The JIT technique ensures company to place exact quantity of raw material that is needed for production. This saves the company from dead stock which is a result of customer’s not purchasing the goods before being removed from sales.
Retailers who are poor at managing their inventory management system may risk their businesses to a greater extent. Understanding the need of the hour, ecSoft has designed an efficient inventory management software that can take care of the entire stocking system of a retail business.
If you are someone who is finding it very much difficult in aligning your stocking or missing regular track of your goods, you can now reach out to ecSoft who can help you with their world’s leading inventory management software in Chennai.