Trading comprises of wholesale, warehousing and retail management which also includes inventory management. Managing the stock is very important in all these aspects of Trading. In fact, the stock is what is being traded and hence, the trader’s first and foremost requirement is to maintain a proper stock of items that are fast moving and less stock of items that are rarely in demand. When it comes to trading perishable goods such as food and flowers, keeping fresh stock becomes more important as it can get stale within a few hours or days. It becomes very important to have a competent Retail Inventory Management System, particularly for perishable goods. Without a reliable inventory management system, maintaining the stock of perishable items become very difficult and it may result even in a huge loss. Considering wholesale or a chain of retail stores dealing in perishable or non-perishable goods, the entire stock may be spread over multiple store locations, warehouses or may be in transit. In such cases, when the customer enquiries for a particular item, without a robust Inventory Management Software, the store manager will not be able to spot exactly where that particular item can be traced. This can make or break the deal with customers. In the long run, it the retail or wholesale will lose a considerable amount of business in spite of retaining the stock of items in demand because it cannot be traced.
Inventory Management – Key to successful wholesale and retail management
Large wholesalers and retailers need a robust Multi-Warehouse Inventory Software to manage their large volumes of stock spread over multiple warehouses across various locations. These locations may, sometimes be, within the same country and sometimes in different continents too. One such example can be an online e-Commerce solution which has customers from across the globe and hence, need to maintain a warehouse at some of the most popular, customer-centric locations. Such an establishment is possible only if the organization runs a robust and reliable inventory management system which keeps track of the real-time the inventory. It will make sure the customer is shown only what is available in their warehouse. Out-of-stock items are marked and displayed only if the customer specifically queries the same. In such cases, even if the customer orders or queries an item which is not available in the nearest warehouse, but is available in some other physical store or warehouse of the organization, they can still fulfill the order provided the customer agrees for a comparatively later delivery. Cloud computing and availability of real-time data in a competent Inventory Software System is the only way to tackle such situations which are common in trading. A competent Inventory Management system integrated with Purchase, Accounting and Sales modules will make sure the stock levels are replenished automatically and products that are high in demand never become out-of-stock.
Features of a perfect Inventory System for Trading Industry
The trading industry cannot take any risk when it comes to maintaining the stock in case of wholesale and retail. The following features are essential to a robust Inventory Management System for trading industry:
It essentially involves keeping track of the current stock of items at various locations and in transit. Stock values and quantity are maintained in the system and periodical physical verification is done to cross-check for pilferage, damage or wastage. This feature gives the real-time stock level of all items traded by the organization and alerts the management when the fast moving products go below the required stock level or reach the re-order level. It also includes options for generating GRN.
It maintains the supplier records including the type of stock they supply, credit limit allowed and the duration taken to replenish stock. Whenever a stock replenishment is required, the system automatically prepares a Purchase order to be sent to the corresponding supplier after considering the credit levels and duration for replenishment of stock. The system keeps track of the payments due to the supplier and alerts the purchase manager when the due date for payment is nearing. It also keeps track of the payments done to them.
It keeps track of the customers, their frequency of order, frequently ordered items, allowed credit limits, generate credit note etc. Customer management is particularly important in Retail Inventory System, as the retailers deal with more customers directly than the wholesalers. The wholesalers also consider customer management crucial as their customers deal with large volume and value of stock.
Enquiry Management / Order Management
It accepts customer enquiry in the case of wholesale as well as retail and checks for the corresponding stock availability in the system. It alerts the supervisor or sales manager regarding the demand and provides information on current stock levels and where exactly it is available within the organization.
Automated Stock Replenishment
This requires the optimal stock values to be set in the Inventory software. The required business validations are also set, based on which the system keeps track of stock that is fast moving and automates replenishment of such stock based on the values set by the management. A value called re-order quantity is manually set against each item in stock which is the base value for stock management. Whenever the quantity of an item nears of goes below the re-order level, the system alerts the Purchase manager to replenish the stock or sends an automated Purchase order, which once approved, is sent to the supplier.
Budgeting Stock Requirements
This forecasts the stock requirements for the forthcoming months or a year based on the past and current sales and purchase data. Budgeting or forecasting stock is very important in Wholesale business as each order will deal with large volumes of stock. Wholesale Inventory System keeps track of stock purchased from each supplier including the time taken for replenishment and the frequency of re-order. Using this data and the demand or enquiry and actual sales of each item in the Inventory, the system forecasts the purchase pattern to be followed to keep optimal stock levels. This is an important feature which helps management decisions and sustains the retail and wholesale businesses.
As important these basic features are for a perfect or competent Inventory Management System for the trading industry, real-time integration with Accounting, Warehousing and Sales modules are also equally important to keep the system running flawlessly. With an integrated system, the management can get reports on the cost of purchase, the cost of sales, the current inventory levels and the optimal inventory levels required to sustain the trading establishment as well as to achieve maximum gain. Cloud computing takes the Inventory System to another level where the real-time stock details are available remotely to authorized users in other locations which unleash boundless opportunities to succeed in the global market.