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  • Writer's pictureCairnstack

Do You Need an Inventory Management System?

Do You Need an Inventory Management System?

You may be trying to decide if you need an inventory management system. Business owners and operators are keenly aware that for every problem, there’s probably a software solution that claims to cure it. Of course there are plenty of tools most businesses accept as standard, like email or accounting software like Quickbooks, but as businesses digitize their workflows, the drawbacks of using email and accounting software beyond their primary purpose becomes painstakingly clear. Collaborating with groups in email is a recipe for disaster and using Quickbooks as a replacement for an ERP or inventory manager will create more problems than it solves.

How a dedicated inventory management system helps business grow

An inventory management system will help you make more money from your existing sales, effectively increasing your margins. A few examples include:

  1. Cut costs associated with excess inventory and labor

  2. Increase profits by reducing stock shortages

  3. Forecast inventory levels with more precision, and

  4. Anyone can oversee inventory status when its digitized

For businesses that carry serialized inventory, where individual items or boxes need to be tracked, an inventory management system will provide real-time inventory information and the costs associated with it. Inventory management systems should help managers quickly and easily answer questions like:

  1. Are we stocking excess inventory?

  2. Are we using our operations resources for inventory effectively? and,

  3. Are we paying our employees appropriately relative to their performance?

Inventory management systems provide real-time answers and much more without much hassle after setup. With real-time inventory data, managers can easily understand inventory performance. Understanding inventory performance is important for businesses in a couple scenarios.

Two situations where inventory management systems provide growth

Businesses can’t solve all of their problems at once, but businesses should address inventory problems when one of two things occur. (1) As businesses grow or as leadership take their feet off of the throttle, inefficiency increases and margins decrease as a result. Even with revenue growth, shrinking margins can result in less profit. An inventory management system ensures accountability, so that labor and inventory is easier to manage and efficiency is easier to quantify and improve. And (2), when a market changes, looking outside of your organization for revenue growth can become a less attainable goal than looking inside. When revenues stagnate, businesses can still cut costs, improve efficiency, and continue to grow by increasing their margins on existing business.

Businesses that are losing efficiency and/or revenues will improve their prospects for growth with an inventory management system.

Knowing when inventory management is necessary

inventory management system

inventory management system is the right solution, managers and business owners have to face up to the fact that they have an inventory/resource problem worth solving. Business leaders often find that it’s easier to do nothing and accept the status quo rather than attempting to identify and address the problems in their organization.


Most businesses want growth and improved efficiency, but what they need and what they want aren’t always the same. When margins are at risk or there is a “master of inventory” type employee who carries the reigns of succession, business leaders find it much easier to commit. Getting buy-in for implementing an inventory management system is crucial, so pressing inventory issues make the decision easier.

Even when inventory problems aren’t an immediate concern, the risk of trying out new software is relatively low. If you’ve read this far, it’s worth a try.

For more information, contact us at 844-868-7225.

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