You might be wondering, what is inventory management? Inventory management refers to the process of ordering, storing, using and selling a company’s inventory. This includes the management of raw materials, components and finished products as well as warehousing and processing of such items. It tries to efficiently streamline inventories to avoid both surpluses as well as shortages. A company’s inventory is one of its most valuable assets. In retail, manufacturing, food services and other inventory intensive sectors, a company’s inputs and finished products are the core of its business. A shortage of inventory when and where it’s needed can be extremely damaging.

That is to say, inventory can be thought of as a liability if not in an accounting sense. A large inventory carries the risk of spoilage, theft, damage, or shifts in demand. That is to say, Inventory must be insured and if it is not sold in time, it may have to be disposed of at clearance prices or simply destroyed.

While the inventory is generally counted by hand, in the modern era, inventory management software has started to make work easier for a lot of businesses. It is a software system for tracking inventory levels, orders, sales and deliveries that isn’t all it can be used for. For example, inventory management software can be used in manufacturing industries to create a work order, bill of materials and other production-related documents. In addition, many companies use it to avoid product overstock and shortages. Now that you know what is inventory management, let us move forward to learning more about it.

What Are The Different Types Of Inventory Management?

While you know, what is inventory management, next we will move on to what are the different types of inventory management. Depending on the type of business or product being analysed, a company will use various inventory methods. While these methods are a sub-category of inventory management, most companies have started going digital. SIPL offers custom inventory management software that suits your needs. Below are some of the methods of inventory management:

• Just-in-Time Management (JIT)

This method allows companies to save significant amounts of money and reduce waste by keeping only the inventory they need to produce and sell products. This approach reduces storage and insurance costs, as well as the cost of liquidating or discarding excess inventory. But this method can be risky. That is to say, if demand unexpectedly spikes, the manufacturer may not be able to source the inventory it needs to meet that demand, damaging its reputation with customers and driving business toward competitors. As a result, the smallest delays can be problematic as if a key input does not arrive in time, a bottleneck can result.

• Materials Requirement Planning (MRP)

This inventory management method is sales forecast dependent, meaning that manufacturers must have accurate sales records to enable accurate planning of inventory needs and to communicate those needs with materials suppliers in a timely manner. Inability to accurately forecast sales and plan inventory acquisitions result in a manufacturer’s inability to fulfil orders.

• Economic Order Quantity (EOQ)

This method is used by calculating the number of units a company should add to its inventory while assuming constant consumer demand. The costs of inventory in the model include holding and setup costs. This method aims to ensure that the right amount of inventory is ordered per batch so a company does not have to make orders too frequently and there is not an excess of inventory sitting on hand.

• Days Sales Of Inventory (DSI)

This method is a financial ratio that indicates the average time in days that a company takes to turn its inventory including goods that are a work of progress into sales. Indicating the liquidity of the inventory, the figure represents how many days a company’s current stock of inventory will last. Generally, a lower DSI is preferred as it indicates a shorter duration to clear off the inventory, though the average DSI varies from one industry to another.

Now that you know what is inventory management and the different methods, let us move forward to what it can do for your business.

What Are Its Benefits?

You have learnt what is inventory management above but you might still be wondering what are its benefits. Accurate inventory management is the key to running a successful business. Tracking stock regularly can help avoid stock errors and other problems. The following are some of the benefits of strong inventory management:

• Better Inventory Accuracy

With solid inventory management, you can know what is in stock and order only the amount of inventory you need to meet the demand.

• Reduced Risk Of Overselling

It helps you track what is in stock and what is on backorder so you don’t oversell products.

• Cost Savings

Stock costs money until it sells. That is to say, carrying costs include storage handling, transportation fees, insurance as well as employee salaries.

• Avoiding Shortages & Overstocking

Proper planning and management help a business minimise the number of days that an item is out of stock and avoid carrying too much inventory.

• Greater Insights

With inventory tracking and stock control, you can also easily spot sales trends or track recalled products or expiry dates.

• Better Terms With Vendors & Suppliers

It provides insight about which products sell and in what volume. This knowledge is used as leverage to negotiate better prices and terms with suppliers.

• More Productivity

Proper inventory management solutions save time that can be spent on other activities.

• Increased Profits

A better understanding of both availability and demand leads to higher inventory turnover which leads to greater profits.

• More Organised Warehouses

An efficient warehouse with items organised based on demand, which items are often sold together and other factors reduces labour costs and speeds up order fulfilment.

• Better Customer Experience

Customers that receive what they ordered on time are more loyal to your store.

In this blog SIPL, you will learn everything about taking your business online. Imagine you are out shopping and find a small local shop selling a hand-carved bamboo pitcher that catches your attention. Like shoppers in our digital age, you decide to go online and check if you can get it for less. As price-savvy customers, it is normal to want the lowest price and most e-commerce stores run on an “unbeatable price” business model. Because of the lack of digital presence, most micro and small businesses rely heavily on selling through large e-commerce platforms because of the sheer volume of customers they draw.

But, these small businesses are often unaware of the losses they incur from the drastic price variation, monthly charges, referral fees and other fees they have to pay based on the services they choose. According to a recent report, select foreign e-commerce platforms like Amazon do actively undercut micro and small retailers in India. Fortunately, with technology, these businesses can now compete with online retail giants through affordable technology and better adoption support. If you are a small business owner, you may have reconsidered a tech upgrade many times. Either because of the fear of high costs and thinking the digital method wouldn’t work as well. Let us debunk some of these digital transition myths:

• The Cost Of Professionalism

Small businesses often hesitate over a digital transition, assuming that even a straightforward cloud-based operating system might have hidden costs too. This is a valid notion, given that most small businesses in India are accustomed to both legacy systems and large e-commerce platforms known for periodic maintenance investments or increasing annual costs. Fortunately, the benefits gained from taking your business online far outweigh these fears.

• Invoicing Solutions Made Easy

For many small business owners, invoices serve as a vital record in their accounting process. They often function as the sole documentation of the client’s agreement to pay for the services or products received. That is to say, as digital transformation continues to accelerate, businesses are warming up to using technology to drive productivity and enable faster payments from customers and clients. Due to both the pandemic and implementation of GST, these small business owners are becoming more open to GST-friendly SaaS tools and services.

• Designing Solutions For Small Business

Micro and small retailers transitioning from a brick and mortar business generally need basic digital tools. That is to say, with its predesigned store templates, you can find maximum value in a sensible time frame. It is an important feature as most small business owners and their employees juggle multiple responsibilities.

• Localised Services

Small or micro business owners likely put in a lot more work than what the consumer sees. For example, someone in an online catering business might make the effort to get to know their customers and offer them specialised services that bigger online catering businesses can’t. That is to say, a promise to replace the food if found unsatisfactory or using locally grown organic produce.

• Taking Inventory

For most small business owners, supply chain development is now a central part of taking your business online. This implies that inventory appears in several forms in their supply chain. Using inventory management software for this will allow you to track your inventory and at the same time communicate honestly with your customers about stock and availability.

Tips For Taking Your Business Online

There is a lot of talk for taking your business online and it can easily be overwhelming, with all the processes and steps involved. If you are a small or local business looking to share your services and products with a larger crowd by going online then it is truly the right time to get started. That is to say, the pandemic has brought significant changes to the economy. It has also created big opportunities for online businesses, including the ability to connect with customers across the globe. Below are some tips to give you a headstart with taking your business online:

• Make A Plan For Your Goals

Setting your goals for creating an online store should be your first step. That is to say, goals outline what you want to accomplish, and choosing clearly defined goals is crucial. In addition, once you have chosen a goal, you can analyse if it is achievable and avoid setting vague expectations. That is to say, it is important to set long term goals to make your business grow. Likewise, it is important to set short term goals that can lead you towards the long term goals.

• Build An Online Presence

Taking your business online also means that your customers can find you with a click of their mouse. In addition, they can more easily assess whether you have the products/services they need, and more easily become a customer. It is important to create content that is aimed at answering the questions your leads and customers will have and satisfying their needs. You can also create social media accounts to update customers and leads with the latest information about your products and services, sales, offers etc.

• Develop A Strong Brand Identity

A brand is what defines you. It separates you from the rest of the competitors in the market. Building a strong and successful brand from the ground isn’t an easy task. That is to say, you need to figure out what your branding will look like and who your target audience is. Your unique value proposition should also be a part of your brand messaging. But that is not all, your visual branding needs to be consistent whenever and wherever customers interact with you. For every part of your business, from your website to customer service emails, the look and feel must be consistent.

• Ensure Easy Shopping Experience

The next step in taking your business online is customer service. It is the heart of any business and providing high-quality service helps you turn visitors into returning customers. It is important to stand out, as customers have plenty of places they can make purchases, and you want them to choose you. In addition, you should create an eCommerce store to sell your products and services. That is to say, setting this up will allow you to accept orders and payments. After all, a comprehensive e-commerce solution can create a smooth shopping experience.

• Engage & Build Connections Online

Networking is important, especially when you are new to online business. By engaging online with customers and other connections, you can open up a sea of opportunities. You can promote your offerings when it is appropriate, but more importantly, you have the chance to learn about customer expectations and needs by interacting with them. That is to say while using social media as a tool to expand connections with business contacts, clients, and potential partners, make sure to post engaging content and not just content focused on your business and your needs.

In this blog, you will learn how can you use software to keep your clients happy. That is to say, for any business, it’s the relationship part of Customer Relationship Management that really matters. There is this old saying “Keep your customers happy and they’ll keep you in business.” which holds true especially in this social-media-centric era. To sum up, customers now are a part of your community. In addition, they want instant answers to their problems and they drive your business.

As a result, customer satisfaction improves loyalty and retention. It costs five times as much to attract a new customer than to hold one, so getting your customers to stick around can lower costs and increase profits. 68% leave a brand because they are upset with the treatment they’ve received. This is often because the employees are overworked. This can be prevented with software integration, reducing the burden on the employees.

How To Use Software To Keep Your Clients Happy?

Some of you might still be wondering can you use software to keep your clients happy? While it is true that there is never a “one size fits all” solution, it’s still possible to tell all your customers that you’re there for them and that you’re listening to them. Here are some ways to how can you use software to keep your clients happy:

• Be Aware Of Every Inch Of Your Product

If you aren’t confident about your own product, what is the customer going to think? Being knowledgeable and confident about every part of your product always helps because only then will you be able to pass on that conviction to the customer.

• State The Facts

To sum up, honesty is the best policy. Playing around with your customers’ expectations just because you want to hold them is a bad idea.

• Be Willing To Educate

Telling more is always good. That is to say, not just about your product/service but about the industry, latest trends or the value addition that you can bring in over your competitors.

• Be In Touch

A call or an email once in a while, telling them about the latest in your product/service or even a tweet will do. Reaching out is simple yet effective.

What Are The Benefits Of Using Software?

Any merging of software applications should produce a business benefit. For example, a tangible saving or an improvement or an ROI. These benefits can be realised as a result of enhancements to existing software systems by improving the way data is collected and shared. In some cases, the benefits are realised as a result of improved capability and capacity and not just through the time-saving workflow. Below are some of the said benefits:

• Simplified Decision Making

Obtaining one complete view by merging your software systems simplifies the decision-making process. It removes the need to move between different applications to get the data that may influence your decisions.

• Increased Productivity

Merging applications that use the same data sources will allow you to improve your operations’ productivity. This is relevant where the same data is entered multiple times into different software systems. That is to say, with one point of data entry and no need to switch between different software applications, the processing is simpler and quicker.

• More Reliable data

Merging your software systems reduces the risk of using inaccurate data. A single point of view will allow your business to work from one perspective and remove conflicting data values.

• Enhanced Analysis

Related data is more meaningful and powerful when it is pulled together in one application. Analysis of multiple data sources is better handled by bringing the data together where trends and conclusions can be drawn sooner.

• Improved Data Security

Managing the security of your data is much easier on one system rather than on multiple systems of data. By merging the management, backup and administration, tasks are simplified.

• Better Customer Service

The ability to access customer information quickly and easily is vital for maintaining good relationships.

• Increased Sales Potential

Merging systems that streamline any element of your end-to-end sales process and improve your order fulfilment rate will have a positive impact on your overall sales potential. 

In this blog, you will learn can small businesses benefit from custom software apps. That is to say, every business can benefit from custom software apps. To sum up, no matter the service or product they offer, if you spend on the right custom software app, your small business will benefit from it. Above all, the question of can small businesses benefit from custom software apps has a simple answer. We look at the key performance indicators of any business such as the data about its customer practices and business process management. What we learn from this is how effectively the small business uses its data to provide better and relevant solutions to what keeps them on the charts. In this modern era, all the data has multiple copies stored at multiple locations, leading to ineffective use of resources.

Why insist on custom software apps instead of off-the-shelf apps? Because every business is different and has different needs. That is to say, custom software apps provide you with a special set of skills that best suits your business needs. Customization not only costs less but also speaks your language. With custom software apps, you can get right to the point without having to pay for multiple programs that suit just one aspect of your needs. They make your business efficient and suit small businesses owners. Even for small businesses that plan on creating their own custom software apps in-house, it offers real benefits. But for small businesses that do not have in-house developers, SIPL has got you covered. Now that you know can small businesses benefit from custom software apps or not, let us move on to the basics.

What Are Small Businesses?

Above you learnt, can small businesses benefit from custom software apps or not. But some of you might be wondering, what are small businesses? Small businesses surround us. They are on every other street and on every corner. Every second thing someone buys comes from a small business. In India, small businesses have gained a special position in the industrial structure because of their ability to utilise labour and create employment.

Small businesses are either service or retail organisations like grocery stores, medical stores, tradespeople, bakeries and small manufacturing units. They are independently owned organisations that require less capital and a smaller workforce with less or no machinery. These businesses are ideally suited to operate on a smaller scale to serve the local community and provide profits to the owners. The Indian government defines small businesses on the basis of the business’s ability to invest in the plant and machinery. Some of the examples of small businesses are as such:

• Small-scale manufacturing industries
• Handlooms and power loom
• Khadi
• Agro-based industries
• Tuition centres
• Photography
• Breakfast joint
• Printing

Advantages Of Using Software For Small Businesses

Above you learnt the meaning of small businesses and can small businesses benefit from custom software apps, let us move forward to the advantages. Starting your first business takes a lot of courage, passion and decision-making skills. That is to say, once you cross that stage of starting up an enterprise with all the love, guts and determination. The next step is to focus on maximising business growth and efficiency. An efficient business always brings in more income than a company operating half its capacity. That is to say, software solutions for any business process not only helps in improving the business flow but also saves a lot of time, money and workforce. Some ways how can small businesses benefit from custom software apps are as listed below:

• Simplify Employee Tasks

Employees often have a full plate so it’s smart to figure out how to simplify the tasks they need to complete. This is where custom software apps come into play. For example, time tracking software allows employees to complete their timesheets as needed. This makes things simpler for not only the employees but the managers and other supervisors as well. To sum up, there are many ways small businesses can stop feeling overwhelmed each day and one of those is through the integration of software.

• Follow Sales Leads

You may have some leads you are hoping to convert on your quest to scale your small business. Don’t let those potential sales fall to the wayside. For example, lead management software can do the job for you. It makes the process easy and convenient to store new leads, capture existing ones and track future sales prospects. With this, your sales team can easily contact customers and pick up right where they left off.

• Better Manage Customer Relationships

Trust and communication are important for great customer relationships. Custom software apps make it easier to effectively manage customer relationships, boosting satisfaction, loyalty and repeat business. They allow you to update the database in real-time as you learn more information about your contacts, making it easier to collect, organise and manage customers’ information. In addition, make sure to monitor your application services so you can detect and resolve application issues in a timely manner.

• Offer A Competitive Advantage

One of the most valuable attributes software has for a business is to give it an edge over its competitors. The software can be customised to your business, making you the only company that has a special solution. Consider using a single system for marketing, sales, project management and more. To sum up, it will simplify tasks making the day-to-day list of to-dos much shorter.

• Bill Clients And Get Paid Faster

Invoicing is probably one of the most challenging tasks that bring stress to small business owners. A lot of time and effort is required to ensure all bills are paid. To sum up, using software to compliment your business’s financial activities like sending invoices, managing expenses and accounting will save your business a lot of time and headache.

Now you know how can small businesses benefit from custom software apps and all the advantages that come along with them.