What is Inventory Management?





What is Inventory Management?





What is Inventory Management?



Inventory management (or stock management) is how merchants know where and how many products they have and how much it costs them to source, to make and to hold those products


Ideally, automated inventory solution will lead to optimized stock levels, increased sales, and maximized margins and cash flow.




Defining Inventory Management

Inventory management is the set of methods and tools merchants use in order to get the right amount of products to market (quickly and at the best price) to meet customer demand. Inventory is all the finished products and/or components to make products that merchants buy with the intent to sell.



Recording
Inventory Data

Products and/or components enter inventory at the time of purchase. Merchants record those purchases in an inventory ledger that can be an actual book (kind of old-school), spreadsheets, a basic app bolted-on to accounting software or eCommerce platforms, or inventory software.



Recording
Inventory Data

Products and/or components enter inventory at the time of purchase. Merchants record those purchases in an inventory ledger that can be an actual book (kind of old-school), spreadsheets, a basic app bolted-on to accounting software or eCommerce platforms, or inventory software.




Inventory Management Methods

With the Perpetual Inventory method, merchants continuously adjust stock levels and costs in their ledgers. With the Periodic Inventory method, they only adjust inventory (by matching stock with sales) after a monthly, quarterly or annual stock-take.


Automated Inventory Management

The more data entry work a merchant must do to synchronize inventory ledgers with orders and sales, the harder it gets to meet customer demand. An automated inventory system will provide accurate, up-to-date data to reduce the risk of overselling (and losing a customer) or overstocking (and eroding margins)



Automated Inventory Management

The more data entry work a merchant must do to synchronize inventory ledgers with orders and sales, the harder it gets to meet customer demand. An automated inventory system will provide accurate, up-to-date data to reduce the risk of overselling (and losing a customer) or overstocking (and eroding margins)




Tools of Inventory Management

Lost stock, overselling, flat sales and ever-shrinking margins can all point to a failing inventory management system and a suffering business. Any inventory management tool should give merchants real-time data and control over their goods across their entire business, efficiently and cost-effectively.That’s exactly what Cin7’s core inventory features, extensive integrations and automated inventory solution do for ominchannel merchants.


Four Results of Automated Inventory Management

Automated inventory management software gives merchants the insight and control to achieve their sales and growth goals, in ways that are all connected.

Increase Sales

Merchants strive to sell quickly, while keeping in line with market trends. If a merchant knows which of their products move and which don’t they know what products they need to build inventory that matches customer demand.

Maximize Margins

Margins are a balancing act. A merchant can lower costs with volume purchases, for example, but if they don’t sell quickly enough, their holding costs can erode margins. Only good inventory management will tell if a merchant is making the best pricing and purchasing decisions possible to maximize their margins.

Optimize Inventory

The oldest question in the history of commerce is how much inventory is enough? When merchants carry too much stock, they increase their holding costs and erode their margins. When they carry too little stock, they risk losing customers to the competition.

Speed Up the Cash Flow

The more a merchant relies on extended credit, the more security the bank demands and that puts a strain on a merchant’s business. Merchants can seek optimal payment terms (getting customers to pay sooner, paying suppliers later) while using good inventory management to move products quickly in and out of their inventory for optimal cash flow.



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