Inventory management is not a simple task for many e-commerce businesses. You may either have too much or too little in stock or may have difficulties monitoring the movements of your products in and out of your warehouse. Inventory management software can help you prevent problems like these, by automating the process as much as possible. However, there are many misconceptions about inventory management that have led businesses to hold off on including it in their operations. Here are the most common inventory management myths and why this software is so important to your success.
Myths about Inventory Management
1. Inventory Management Software Is Unnecessary
If you believe that managing your inventory is not as important as the other aspects of your company, you may face some big challenges in the future. Inventory management software is essential to your success as a business, as it allows you to simplify and streamline the movements of your products and their data. It may take some effort to implement this software correctly, so working with a third-party logistics partner can help you.
2. Inventory Should Be Managed Locally
A localized inventory management approach is not always the most effective, yet many companies use this method, believing that by using local warehouses they can store their products better. When choosing the location of your warehouses, find out where your customers are located. Then, choose the locations that will make it easier for you to get your products to your customers in the fastest, most efficient way.
3. Buying in Bulk Saves Money
It’s true that many suppliers offer discounts for purchasing items in large order quantities, but it does not always equate to money saved. By bulk purchasing inventory, you could risk a shortfall in cash flow and take on excess storage costs. If you have too much stock, during a time where there is not a high demand for the product, your capital is tied up in the products sitting on your shelves. Inventory that takes up valuable space runs the risk of waste and becoming obsolete. The only time buying in bulk saves money is when there is a high demand for specific products.
4. Start the Business before Planning Inventory Strategy
One of the most important aspects that leads to success is inventory control. This plan needs to be in place before you start your business, so you can effectively manage your inventory as your business grows. It will be a huge mistake to start a business first, as mismanaged inventory is one of the major reasons that small businesses fail.
5. Inventory Management Is Easy
Although inventory management software helps simplify the process, it does not make it easy. Inventory management required generating reports, finding inefficiencies, reordering new parts and products, and managing multiple locations.
6. Suppliers with the Lowest Prices Are the Best Option
Cost is only one of the factors to consider when choosing the right supplier. You also need to ensure the supplier is providing quality products, has short lead times for ordering, and is reliable. If you choose a cheap supplier without these factors, you could lose money in the long-run. Even though you are paying a low price, you have to spend more time, money, and energy dealing with mistakes, upset customers, and improving your online reputation.
7. Inventory Management Software Is Too Expensive
It is true that many small businesses are unable to afford all the expensive inventory software that larger businesses can afford; however, there is software that offers most of these functions and is available at a fraction of the cost. Another alternative is partnering with a third-party logistics provider. These companies offer inventory management software, as well as warehousing and distribution services that can help you during peak seasons and as your business grows.
8. Keeping as Little Inventory On-Hand as Possible Saves Money
Imagine your customer goes to purchase and item from you, only to realize it is on backorder. This is extremely frustrating to customers, and can affect your reputation. Overstocking is a problem too, but limiting your inventory to save money is an equally damaging issue. You could lose sales and drive your customers away if you understock. Inventory management software can help you find the balance between having too little and too much inventory.
Let APS Fulfillment, Inc. Help You with Inventory Management
Tracking your inventory manually or with spreadsheets is exhausting and risky as your business grows. There are many reasons why inventory management software makes your business work more efficiently and accurately. Unfortunately, myths continue to hold businesses back from reaping the benefits. By proactively implementing software like this, you can prevent risks from hurting your ability to run smooth operations and please your customers. As you can see from the myths above, inventory management software offers more benefits than disadvantages.
If you want to implement inventory management software and work with a third-party logistics partner who cares about your success, APS Fulfillment, Inc. can help you. Our professionals provide our clients solutions to meet their warehouse organization needs. We provide services such as real-time inventory management, e-commerce fulfillment, direct mail marketing, fulfillment solutions, and fulfillment markets. There are endless benefits to working with a third-party logistics company that uses the best quality software systems to manage your warehouse, so if you’re looking for the right company, look no further than APS Fulfillment, Inc. You can contact us by e-mail at [email protected] or toll-free by phone at (954) 582-7450.