A lot of companies face numerous inventory-related challenges. What does this exactly mean? Well, it can be difficult to stay organized with all the papers and documents in an office, regardless of how hard one tries. Poor inventory management can have a significant effect on business.
Simply put, employees won’t be able to find what they are looking for immediately, so they will lose precious time roaming through boxes instead of doing their job. Furthermore, it means that they won’t provide successful customer support, which can be even worse.
If you are currently struggling with organizing the inventory, keep reading this article. Not only will we discuss some of the most common issues, but we will also provide you with a number of solutions.
Not knowing your inventory
The first challenge that occurs due to the poor organization is that companies aren’t fully familiar with their inventory. This may sound ridiculous to you, but it is true. Just think about all the documents, papers, receipts, etc. It can be very easy to misplace one of these if you do not have a filing system.
Due to this reason, the first thing you should do is design this management system. You have multiple options, and the trick is to figure out which one works the best for you. You can file papers by alphabetic, numerical, chronological order, or by category and subject.
Once you have done this, it is time to store them in files and folders. When it comes to office supplies, you can easily order these online, and the best part is that you will be able to find the folders and baskets of the exact size you need. What’s more, you can even choose them according to design and color.
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Outdated systems
For some reason, many companies still use outdated filing systems or expect their employees to do the job themselves. Why would you do this when nowadays you can choose between an abundance of software that will make this entire process a lot easier?
By using any cloud-based management program, both you and your employees will be able to update the inventory at any time of day or night. In addition, you will also be able to quickly find and access the data you need, which will greatly improve your business’s overall efficiency.
Limited visibility
This is another issue businesses face when they don’t have a proper management system. It is of crucial importance to be able to understand what documents and items you have in your inventory. If you cannot do this, you cannot expect to grow your company, but instead, you will probably stay in the same place, struggling with unnecessary issues.
What’s more, if you have to make a big, important decision, you have to go over previous files and documents, right? Well, how can you do this if you cannot locate them? This means that not only would you have to delay the decision and changes, but you also run the risk of making a wrong one because you won’t have all data at your disposal.
Customer demand
As you know, customer demand is constantly changing, which means that at a certain point, some items won’t be as popular as they used to be. It means that it is your job to stay on top of the latest needs of your clients and ensure that you can meet all of them. This is the only way to stay one step in front of your competition.
By having all the information at your disposal, you will be able to understand these changes and maybe predict some of them by following the latest trends. It means that you will know exactly which products will be popular, so you will have enough time to stock them in your warehouse and ship them as soon as you receive an order.
What are the benefits of inventory management?
Now that we have introduced you to some common issues businesses face, it is time to tell you why you should work on developing an inventory management system.
Save money
Whenever one of the above-mentioned problems arise, you have to deal with it and fix it as soon as possible. However, this cannot always be done in house, meaning that you might have to hire professionals. Their fee may seem insignificant at first, but when you are required to employ them over and over, at the end, when you calculate the expenses, it can be quite costly.
Prevent overstocking
If you are limited space-wise and only have a small warehouse, overstocking can prove to be a significant problem. This is especially true if you sell sensitive goods with a short shelf life and if they require special storing conditions.
If you cannot access all the documents in time before placing an order, this is likely to happen, and dealing with it can be very challenging. You would have to return all the goods to the manufacturer, or you would simply lose a lot of money letting it reach their expiration date since you wouldn’t be able to sell them afterward. We are not even going to discuss what a negative effect this can have on the reputation of your company.
Improve customer service
We have already explained what a negative impact poor inventory management can have on customer satisfaction, so it is natural for this to be an important benefit. If you run an e-commerce store, it is vital that you know the exact number of each item you have in the warehouse. Otherwise, you won’t be able to run the business successfully.
For example, if it turns out that a certain item isn’t available, but you haven’t changed its status on the website, and the customer already placed an order, it would be your job to call them and notify them that you cannot provide them with the service. Due to the fact that many online stores operate nowadays, it is probable that you would lose customers since they would contact one of your competitors.
Rhydian Choi 
Kim Marks