The pandemic threw supply chains into disarray. And even now, in 2023, businesses are still playing catchup, according to analysts at McKinsey.
If that sounds familiar, one change you might need to make is how you handle inventory. But before you go ahead and buy an inventory management solution, there might be something else to consider first.
You should consider investing in a solution that puts accounting and inventory management in one place.
In this business guide, we’ll explain why you might want to do that and what benefits you’ll see. We’ll also walk you through the steps to take if you choose this type of system to help you find the best solution.
The Benefits of Inventory Management
Inventory management is the backbone of any successful business. It helps a company grow and thrive.
It’s all about having the right items, in the right amounts, at the right time. When a business takes care of its inventory, it keeps its customers happy and its bank account healthy.
One significant benefit of good inventory management is knowing when to restock popular items.
By tracking what sells well, a business can order more before they run out. That way, customers find what they want and keep coming back. It also helps a company save money by not spending on items that don’t sell quickly.
Inventory management also makes finding items in the store or warehouse easier. That means faster service for customers and less time wasted looking for things.
Plus, when a business manages its inventory well, it keeps the warehouse tidy. It makes your store floor look professional, and you won’t lose valuable goods.
Inventory Management and Automation
In today’s world, you don’t have to manage inventory manually. Inventory software helps you automate the process.
If you haven’t used software for inventory before, here we will explain some benefits. Plus, we’ll describe a specific software model called cloud-based, so you can decide whether that’s right for your business.
Why Choose a Software Solution?
Choosing a software solution for inventory management is wise for any business. Why? Well, inventory software is faster and more efficient than doing things the manual way.
You’ll complete complex inventory tasks in record time and find that your record-keeping is far more accurate. That saves time and reduces mistakes. With software, businesses can track items, restock quickly, and make better decisions.
Plus, robust software can grow alongside a business. As a company expands, it can handle more items and customers without making significant adjustments.
Manual methods can be slow and hard to keep up with. So, using inventory management software is an excellent way for a business to stay ahead of the game.
Should You Choose Cloud-Based?
Cloud-based software lives on the internet, so you don’t have to install it on internal business servers.
It means you can use the software from anywhere, as long as you have a computer or a device with the internet. All your data is stored online.
A cloud-based option is excellent for a business wanting inventory management software. It’s easy to use and update; you can access it anywhere.
Also, you don’t have to worry about losing your data if something happens to your computer. So, cloud-based software is a smart and safe choice for managing inventory.
Why Integrate Your Inventory Management With Your Accounting System?
Integrating your inventory management with modern accounting tools is like having an elite team working together for your business. When these two systems join forces, they bring many benefits.
Here are some of the top reasons to make this move:
It Saves Time
When your inventory and accounting systems work together, you spend less time entering data. That is because information flows between the two systems, meaning you don’t have to do it all by hand.
Manual data entry can lead to mistakes. By integrating the two systems, you lower the chances of errors happening. That helps your business run more smoothly and keeps your records accurate.
Better Financial Information
When your inventory and accounting systems are connected, you can easily see how your inventory affects your finances. That helps you make smarter decisions about what to buy and when.
It Helps You Stay Organized
With an integrated system, everything is in one place. That makes finding essential information more manageable and keeps your business running smoothly.
Improves Cash Flow
Knowing what’s in your inventory and how much it’s worth helps you make better spending decisions. That can lead to improved cash flow, which is essential for any business.
Better Decision Making
Having all your information in one place helps you make fast decisions. That can be especially helpful when responding to sudden business or market changes.
With integrated systems, creating reports for your business becomes a breeze. That means you can spend less time making reports and more time focusing on growing your business.
Better Customer Service
When your inventory and accounting systems work together, you can serve your customers better. You’ll know what you have in stock and can quickly process orders and payments.
Audits can be stressful for any business, but integrated systems make them more manageable. Your records will be more accurate, and finding the information you need will be more straightforward.
As your business grows, an integrated system can grow with you. That means you won’t have to switch systems or start from scratch as your company expands.
In short, integrating your inventory management with your accounting system is a smart move for any business. It saves time, reduces errors, and helps you make better decisions.
Inventory Management in an Accounting System: Identifying Your Needs
Now that you understand the benefits, you might want to know how to get an accounting system that offers inventory management. Here are some simple steps you can take to help you find the perfect solution.
Identifying Your Accounting Needs
When selecting an accounting system with inventory management, it’s crucial to think about your business’s accounting needs first.
That is because the accounting part helps you establish your financial processes.
Building your inventory management processes to fit your accounting system is easier when you have that. That’s how you’ll best manage your money and grow your business.
To find out your accounting needs, ask yourself some questions:
- What types of reports do I need?
- How many users should access the system?
- What features are most important, like invoicing or payroll?
Once you know your needs, you can use those requirements to find an accounting and inventory management system that offers a good match.
That way, you’ll have a powerful tool to keep your business on track with finances, protecting your cash flow and helping you generate a healthy profit.
Identifying Your Inventory Needs
After figuring out your accounting needs, the next step is establishing your business’s inventory management needs.
That is important because inventory management helps you control your stock, ensuring the right products are available for your customers. And that becomes easier with a solid accounting foundation in your business.
To find out your inventory management needs, consider these questions:
- How many items do I need to track?
- What level of detail do I need for each item (like size, color, or weight)?
- Do I need to manage multiple locations or warehouses?
- How often do I need to update inventory levels?
- What kind of alerts or notifications would be helpful?
You’ll have a clear picture of your inventory management needs by answering these questions. Then, you can choose an accounting system with powerful financial features and practical inventory management tools.
Alternatively, you can go for the easy option and choose an inventory platform that integrates with your preferred accounting system. OrderTaker does that, and you can find out about our integrations here.
Choosing the Right System
Now that you know your business’s accounting and inventory management needs, it’s time to find the best system. Here’s a step-by-step guide to help you make the right choice:
Make a List
Start by writing and prioritizing your accounting and inventory management requirements. This list will help you focus on what’s important when comparing different systems.
Research Your Options
Look for systems that meet your needs. You can search online, ask other business owners, or talk to experts. Review their features. Make a list of options that look promising.
Compare and contrast the features of each system on your list.
Make sure they offer what you need for both accounting and inventory management. You might also want to consider ease of use, customer support, integration features, and how well the system can grow with your business.
See what other users say about the systems you’re considering. Reviews can give you insight into how well the system works and if it’s easy to use. Look for feedback from businesses similar to yours.
Many software providers offer demos or free trials. That is an excellent opportunity to see if the system is user-friendly and meets your needs. Try your top choices to get a feel for how they work.
While finding a system that meets your needs is essential, you must also consider the price. Compare the costs of each option, including setup fees, monthly fees, and any additional charges.
If you have any questions or concerns, don’t hesitate to contact the software provider. A good provider will be happy to help you make an informed decision.
Make a Decision
Once you’ve researched, compared features, read reviews, and considered costs, it’s time to choose the best system for your business. Remember, the right system will be easy to use, meet your needs, and fit your budget.
By following these steps, you’ll be well on your way to choosing the perfect accounting system with inventory management for your business.
With the perfect system, you can manage your finances and inventory more efficiently, save time, reduce errors, and keep your customers happy. That will lead to greater success and growth for your business.
Streamlining Your Accounting and Inventory Processes
Once you have an accounting system with inventory management, it’s time to make your business more efficient by streamlining your processes. Here are some business tips to help you:
Set Up Your System
Start by adding all your products, customers, and suppliers to the system. Ensure you include essential details like item descriptions, prices, and quantities.
Many systems have features that can do tasks automatically, like creating invoices, updating inventory levels, and generating reports. Use these tools to save time and reduce errors.
Train Your Team
Make sure everyone who needs to use the system knows how it works. That will help your team be more efficient and confident when handling accounting and inventory tasks.
The system can create reports to help you make better decisions about your business. Use these reports to see what’s selling well, track expenses, and plan for the future.
Keep Data Up to Date
Regularly update your system with new information, like new products or price changes. That will help your system work better and give you accurate, helpful data.
These steps will make your accounting and inventory processes faster and more efficient.
That will help your business run smoothly, save time, boost sales, and keep your customers happy. A streamlined process is a wise option for any ambitious business.
Accounting and Inventory Management in One Place
An accounting system that includes inventory management is a game-changer for your business.
Combining these two critical tasks will save time, reduce errors, and make better decisions. Plus, your business will run more smoothly, and your customers will be happier.
Remember, a robust system that handles accounting and inventory is a powerful asset. So, invest in a system that will support you every step on your journey to success.
For more information on the features and accounting integrations of our popular OrderTaker platform, head here to book a 10-minute conversation with one of our experts.
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