Working with stock management in 3 steps

Working with stock management does not have to be difficult for an SME. After all, nowadays there are dozens of tools to keep track of your inventory flawlessly and to support your inventory processes.

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Working with stock management does not have to be difficult for an SME. After all, nowadays there are dozens of tools to keep track of your inventory flawlessly and to support your inventory processes. That large selection of programs mainly plays to your advantage; there is something for everyone. The other side of the coin, however, is that you soon lose sight of the wood for the trees.

 

Plus, you rarely, if ever, start tracking your large-scale inventory from scratch. That is a process that grows with your company. Still, there is a big difference between keeping an eye on your item numbers and ordering some more as soon as you see that the stock is dwindling on the one hand. And the use of a thorough stock administration on the other hand.

 

Below you will find 3 major steps to make your switch easier.

Step 1: Analyze the needs and wishes for your stock management

In the first place, it is essential that you determine for yourself how extensive your current stock management is and what direction you want to take in the future. That is why it is extremely useful to thoroughly analyze your current stock situation before making major changes.

How do you currently manage your stock?

Whether you keep track of your stock in an Excel file or in a program that no longer meets your requirements, map out your current processes. Below are some questions to guide your analysis:

  • How do you register incoming deliveries to increase stock?

  • How do you record outgoing deliveries to reduce inventory?

  • Do you have an overview of your stock at all times?

  • How do you know when you need to reorder items?

After all, starting from your current working method is much easier than providing the required functionalities from scratch. Therefore, take a look at what you are already doing and what obstacles you encounter in doing so.

What does your company really need right now?? 

From the way you currently handle your inventory, you can then deduce which facets of inventory management you already use. It is very important to describe your needs in terms of the various functionalities and not just want to take over your current processes.

 

Below you will find some questions that can help you:

  • Do you use different stock locations?

  • Do your items have a life cycle?

  • Can you easily request the value of your stock?

  • Do you need a link with your cash register / POS (Point-of-Sales)?

  • Do you have all the necessary stock lists?

  • Do you have stock statistics?

  • Is your stock fully traceable?

  • Do you need a link to your webshop?

Step 2: Stock management software that suits your company.

Stock management encompasses a wide variety of methods and processes. Moreover, one program is not the other. There are dozens of stock management packages on the market and making a choice is not always easy. However, making a good choice is essential to achieve successful stock management.

 

>> Interested to learn more on how to choose the right application for your inventory management?

 

That's why step one is so important: you now know exactly what you need. Proper preparation will ensure that you do not have to go looking for software unknowingly. Instead of having your needs fulfilled by the suppliers you contact, you can already bring a lot to the table.

 

TIP: first test all required functionalities against the functionalities of the software on the market.

 

Moreover, you should also consider the service that they offer in addition to the software. If you like to have personal contact with your supplier without every call or visit resulting in a hefty invoice, you can already remove many suppliers from the list.

 

Everything depends on what feels right for you. Of course you can always switch again after a year if your contract allows it, but that takes a lot of time, money and effort. It is therefore better to think about your choice a little longer.

Step 3: Provide the ideal workflow

Purchasing a good tool is already an important step forward, but that is of course not enough to optimize your processes. Once you have chosen the software for your inventory management, you can start building the ideal workflow.

 

What your workflow looks like is closely related to the nature of your business. And while there are certainly plenty of standards and seasoned examples out there, each company has its own character.

 

TIP: Many entrepreneurs make the mistake of wanting to adopt their old processes exactly when they switch software. That is often unproductive. It is much more efficient to arrive at a suitable, new flow together with your supplier.

Everything starts with tracking your inventory.

One of the main goals of a neat inventory administration is the accuracy of the inventory data. If your data is not correct, you cannot draw good conclusions, with all possible negative consequences. Bad data often leads to bad decisions.

 

That's why building your inventory flow starts with thinking about which document types you use. Which documents affect your stock? In an ideal situation, every stock change is linked to a document. In this way the change is traceable. This not only provides more insight into your stock, but also makes it very easy to correct mistakes.

 

TIP: do not work with manual stock changes. Manual actions not only cause problems with traceability, but the risk of mistakes is much higher.

Stock circulation - an example: what could such a flow look like?

You make a quote for a customer and your stock remains untouched. When the customer agrees to the quote, you create a purchase order, which reserves the items on that receipt in inventory. Although your stock has remained the same, your available stock has decreased.

 

You then complete the order, deliver and create the delivery note. In the background, the reserved stock disappears and the actual stock is deducted. Finally, you create another invoice for your customer, but the stock remains the same since you already created a delivery note. After all, every document in this flow is linked to each other.

 

But what if your stock has fallen below the minimum stock as a result? Then you look at the automatically generated order advice. Based on those suggestions, a purchase order form is created, so that your stock is now on order.

 

You order the goods from your supplier and your supplier in turn takes care of the delivery. At that time, you create the purchase delivery note. As a result, the stock on order decreases in favor of your actual stock. And so the circle is complete.

A three-step plan to work with inventory management

So you can start working with stock management or renew your process in 3 steps:

  • first you analyze your current situation and your wishes for the future,
  • then you look for software that meets those needs
  • and finally, you build an optimal process structure together with your suppliers.

 

The steps above may seem obvious, but they form the basis for making a good choice. In addition, they ensure that the foundation of your new processes is in place. It may be the dream of every company that such major changes go completely smoothly, but that is rarely the case. You will undoubtedly have to adjust your processes as you go along.

 

Are you curious about how you can get your stock management in order with AXITO? Request a free demonstration.