Why Tracking Inventory Is Vital To Your Business
Inventory tracking is vital to every company because you want to know what inventory you have and exactly where inventory is at any giving time. It’s so important, larger companies have designated departments to track inventory. Why would you build a whole department to track it? MONEY!
Large companies (and even smaller companies) spend a small fortune on buying inventory. Inventory tracking is key in inventory management.
Before we dive in, let’s take a look at the definition of inventory tracking.
What Is Inventory Tracking?
Inventory tracking involves tracking inventory you have; these are tracked using SKUs. It also tracks SKU locations where they’re stored, as well as the amounts that are available at each location. One of the most important features you want in your provider is the ability to track inventory levels in real-time. This is especially true for those of that own ecommerce businesses as it’s an important part of the supply chain.
There’s a number of different ways companies use inventory. Both retailers and wholesalers buy and sell products. These types of businesses carry inventory that consist of the products they sell and buy. Manufacturers use inventory differently, their inventory consist of raw materials or items they use to build products.
As you can imagine, keeping track of all their moving inventory is vital to the success of the company. Many companies have a lot of money invested in inventory, so knowing where everything is at any given moment is always important. That leads to the obvious next question, how do we track inventory effectively?
How To Track Inventory
There’s 3 ways to track inventory, manually, using software or a combination of the two.
No matter what you use, you track inventory to know exactly how your inventory is moving.
If you track inventory manually, that can work when you’re a new business. However, large companies use software and if you want a more efficient fulfillment process, you’d use software too.
Here at Thill, our order management software helps you track all of your moving inventory.
Go back a few decades ago, companies had to manually track inventory. Can you imagine having to track thousands, tens of thousands of products daily? As you can imagine, human error was a problem, accuracy was a problem. As OMS technology became available, companies rushed to automate their inventory tracking.
Companies that own their inventory have a lot of money invested into it. Due to this, you want to know where inventory is.
You also want to know the status on your inventory, such as;
- It is damaged
- Has it been returned
- It is on hold
- Has it been rejected
- Has it been accepted
Keeping a close eye on your inventory also deters loss and theft, which can easily add up if you’re not in control of your inventory management.
What Is An inventory Tracking System?
Inventory management software and programs give you the ability to have an inventory tracking system that gives you the ability to track real-time inventory levels of each SKU for better inventory control across all of your locations. With this in place, you’re going to know how much product is ready to be shipped out if a customer orders a product. It will also help you as it pertains to sending units to locations, as well as any back orders for items that not in stock.
Out of all the tools, software, and apps you could have, it is the inventory tracking software/system that is one of the most efficient inventory tracking methods you can use.
Inventory Tracking Methods
There’s a few different ways you can track your inventory.
One of the most popular and common tracking methods is by using barcodes. Also referred to as universal product code (UPC), Barcodes are commonly used by grocery companies and retailers. These companies are able to scan the barcodes to find products, see how many are in stock, check on different sizes.
Barcodes can also be used to track inventory, get product descriptions, product prices and its unit of measurement.
The other method used to track inventory is called radio frequency identification or (RFID). RFID technology comes in 2 forms:, one being active RFID and the other being passive RFID. Active RFID works best in environments where security issues exist and requires real-time tracking information. Passive RFID works best when used with handheld scanners and where security issues are not a concern.
Ecommerce Inventory Tracking
While barcodes are great for tracking inventory in physical stores, what about ecommerce platforms?
There’s a few things you need to consider when track inventory through an ecommerce store or website.
If you’re using a popular ecommerce platform, such as Shopify or WooCommerce, it’s important your inventory software integrates with your ecommerce website.
Our order management software here at Thill does just that, giving you real-time updates on your inventory. We have several integrations that will work with your ecommerce sites, such as
- Shopify Fulfillment
- Amazon Fulfillment
- Ebay Fulfillment
- Magento Fulfillment
- WooCommerce Fulfilment
- KickStarter Fulfillment
Some of the largest investments your company makes involves inventory. Inventory management for an E-Commerce business can be complex if the right pillars are not in place.
Larger ecommerce retailers can have tens of thousands of SKUs to manage, keeping real-time updates on your inventory at all times is a priority task for all companies.
Thanks to the technology that Thill Inc. offers, companies of all sizes are able to track their inventory in real-time.
This allows you to make the “right” decisions at the “right” time, no guessing, no questioning, you know exactly where your company sits in every possible scenario. Plus, for those of you that operate in the ecommerce space, our OMS integrates with all the popular ecommerce platforms.
Our powerful order fulfillment software (OMS) can help you grow your ecommerce business through efficient order fulfillment services. Give us a call today and speak to a fulfillment expert to learn how.
Challenges To Tracking Inventory
Tracking inventory can be simple and tracking inventory can be complex, it all depends on your specific situation.
When business owners run into trouble with tracking inventory, it’s usually because;
- They have a lot of inventory to track
- Inventory moves a lot
- Inventory track takes up a lot of time and energy
All 3 of these make tracking inventory a challenge.
As a startup business, tracking inventory is easy, right? You’re only dealing with a few orders here and there. However, as you start to grow and experience more sales coming in, it can quickly get out of hand. Next thing you know, you have hundreds, thousands of products that need to be shipped out regularly. It can happen overnight, so you have to be prepared for that.
Inventory Tracking Solutions
There’s a few options you have to get your inventory tracking right.
- Spreadsheets – Spreadsheets are the easiest solutions you have for low volume inventory tracking. You can start with Google Sheets, so you don’t have no expenses to use this method. You can add SKUs as needed, make sure you have columns for the quantity and other details you may need for each product.
- Card System – This one is an old strategy, but card systems tracking inventory by writing down every transaction from your POS. It’s a good system to have when you don’t have anything else.
- Inventory Apps – A solution that continues to grow in popularity is Inventory Apps. Many of these inventory apps integrate with major ecommerce platforms, such as Shopify, Amazon, Ebay, WooCommerce, and Magento.
- Using 3PLs – Third-party logistics (3PL) companies give you the opportunity to outsource your order fulfillment, which means they’ll receive your inventory, store product in the appropriate pallet, shelf, or bin location, and then pack boxes and ship orders to customers as soon as an order is placed. While many people think order fulfillment costs would be a lot, most are surprised how much money they can save investing in the third party order fulfillment partner.
Can A 3PL Can Help You Track Inventory More Efficiently?
3PL companies excel at inventory tracking, they must do so or they wouldn’t have a business model. What most people don’t realize is how complex a 3PL fulfillment company’s order fulfillment services are. If you’re looking for a solution for inventory tracking, ecommerce order fulfillment, returns management, and these other areas, a 3PL may be exactly what you’re looking for heading into the 3 quarter and beyond.
Here at Thill Inc., we offer a wide range of solutions;
- Order Fulfillment
- Order Management
- Returns Management
- Product Sourcing
- Picking And Packing
- Value Added Services
- Data And Analytics
What else can a 3PL help you with?
Real-Time Inventory Solutions
Most 3PL companies today have state-of-the-art technology and software that lets you digitally review your entire inventory from anywhere. Integrated software allows you to connect to your online store(s) and lets you sync SKUs and orders to view all inventory, fulfillment centers, sales channels, and customers in one place. This is a powerful solution for individual business owners and equally powerful for companies.
When you partner with a 3PL, you can automate your entire ecommerce fulfillment process. 3PLs are experts in logging any inbound or outgoing products. They should have real-time inventory reports that detail exact inventory levels in their warehouses.
If you’ve made it this far, hope you’ve found this helpful.
Successful inventory tracking does not come without its challenges, but having the right tools in place can help you scale and save money. Thill Inc. is a great solution for fast-growing online brands that need to scale their ecommerce shipping and logistics.
We’re always ready to help you take your business to the next level and beyond.