Almost all businesses have some type of inventory. Whether you stock goods for sale or ingredients to make meals, your store needs to keep track of all supplies. If not, you may become overwhelmed with a surplus of goods, or you might serve spoiled milk to your customers!
Much like you need to keep accurate records of all financials, you need to use small business inventory management to keep accurate stock levels. Luckily, technology offers several ways to create a simple inventory system for small businesses.
What is the purpose of inventory management?
Picture this: You visit a large retail store to purchase a shirt. After finding the shirt, you realize they do not have your size. You ask a sales associate if they have your size in stock. Since this store carries thousands of products, its stock room is massive and contains rows and rows of boxes.
With proper inventory management, the worker can quickly see if your size is in stock and will know exactly where to find it. Otherwise, the employee will need to search the entire stock room to determine if the store has the item. One option takes minutes, while the other can take hours.
Small business inventory management helps entrepreneurs oversee the flow of stock, plan their finances, and build staffing schedules. As a store’s stock room grows and the business expands, proper management will ensure predictable expenses and consistent customer service.
How SimbaPOS does small business inventory management
The need to keep track of inventory is crucial. It can be a headache to organize your stock room and crunch numbers without the right tools. Some people try to get by with spreadsheets, but this is not a scalable way to keep track of inventory for a small business.
Thankfully, SimbaPOS created a powerful point of sale system that takes hours of work and turns it into a 10-minute process. Here are some of the ways our electronic POS simplifies inventory management.
Reduces costs
Stores and restaurants that don’t keep an eye on their supplies are often plagued with excess expenses.
For example, a restaurant might need to know how many litres of milk it uses every week or so. That way, the owner can place routine orders and ensure there is always enough milk in stock. However, not tracking this usage and estimating each order could cause excess ordering. Now, the restaurant is stuck with too much milk that will go bad after two weeks. Since there is no way to sell it fast enough, the business will waste money on these purchases.
The SimbaPOS system monitors all inventory, whether it is in a storage room or on the shelves. Each time a product is sold, the inventory is updated to reflect the most accurate count. Business owners can then identify what is selling, what is in stock, and when to order more.
Prevent shrinkage
Shrinkage is defined as the loss of inventory due to employee theft, shoplifting, administrative error, vendor fraud, damage, and cashier error. For small businesses, this may seem like a small issue, but it is anything but that. In 2017 alone, shrinkage cost the Global retail sector billions of dollars
An unorganized stock room is a dream for an employee with sticky fingers. While your employees may be honest and trustworthy, nothing is stopping them from sneaking a can of soda or a small item from storage every so often. After a few weeks of these harmless thefts, your business may see some significant losses.
Likewise, an employee can sneak a shillings from a traditional cash register without anyone noticing. If they do this a few times per week, the employee can sneak in an extra paycheck.
With a point of sale system with inventory management features can track exactly what item was purchased, who rang up the transaction, and what payment type was used. If a few shillings go missing, the owner can check the records and see precisely which employee is the likely culprit. Also, the POS shows what inventory is in storage, discouraging employees from snagging anything since it will cause a reporting discrepancy.
Identify and keep up with consumer trends
Whatever service or goods your business offers, you should want to provide what the customers want. Your small business inventory management system should help you identify changes in supply and demand and cater to these needs.
Consider the problem of dead stock. A business that lets inventory levels of a specific item creep up will eventually be faced with the problem of having a stockpile of unwanted goods. For a local mom and pop shop, dead inventory can become a huge expense that can cause severe financial stress. Small business inventory management is key to preventing this type of dead inventory disaster.
The SimbaPOS System visualizes data to show you how your inventory is performing. If certain goods are selling left and right, you can check how much stock you have and place orders ahead of time to keep up with the demand. On the other hand, you can track historical sales and notice downward trends to avoid carrying unwanted goods.
Are you sure your inventory count is accurate?
SimbaPOS provides hardware and software that can improve your inventory management, simplify your accounting process, improve your customer service, and so much more.
Speak with a consultant today to see what SimbaPOS can do for you.