Inventory control is essential for any organization that wants to optimize its merchandising process. Having the right system in place allows better tracking of products, more organization, accurate data and reporting, and improved warehouse efficiency—all leading to increased revenue.
Objectives of inventory control
Inventory control is the part of your inventory management system that involves what’s currently in stock. It’s about knowing the condition and location of items and controlling when they arrive and leave the warehouse.
A proper inventory control system not only details how much of an item is available, but it also knows when supplies are coming in and when packages are going out. It maximizes and controls every aspect of the stock in the warehouse. The purpose of inventory control is to help warehouses with improving loss prevention, optimizing inventory spaces, and creating less over or understocking.
How inventory control differs from inventory management
Inventory control is a subset of inventory management. Inventory management includes all areas of managing inventory, from purchasing and production, to sales and reporting. Inventory control refers to the maintaining and managing of stock. It’s the specific process used to maximize a company’s use of inventory.
Inventory management may refer to a company’s entire process of purchasing supplies, creating items, selling those items, and tracking shipments. Inventory control, however, is the process of determining how many items are in stock, what their quality is, where they are located, and if there are enough to meet customers’ demands.
Determine which process your business needs
You can determine whether you need inventory control or inventory management by assessing your current system and identifying gaps. Maybe you know every detail about your products, but your shipping or ordering process is not where it should be. Or maybe you can track raw materials all the way through order fulfillment, but your stock area is messy and disorganized.
So, which process do you need: inventory management or inventory control? Most businesses can actually benefit from both. An inventory management system that has proper inventory control will yield more efficiency, lower operating costs, better forecasting, increased warehouse organization, and greater profit.
Inventory control best practices
Don’t underestimate the importance of inventory control. Here are a few practices you should implement in order to create a more effective system:
- Create an organized floor plan. It’s essential that the warehouse is arranged in an order that makes sense. A well-organized room will have proper labels and signage, with the most popular items located closer to the shipping area in order to maximize productivity. Rather than wasting time trying to locate top sellers, employees can grab them from a convenient location. Modify the floor plan as supply and demand changes over time.
- Use clear labels and signage. Relevant labeling provides quicker and more efficient fulfillment. Ensure you have clear and concise labels on all racks, bins, and products. You can use labeling software to print them, and try other tools like inventory tags, barcodes, scanners, and RFID systems that allow real-time inventory control.
- Implement cycle counting. Cycle counting is the act of counting items in small sections over certain cycles. Rather than counting everything at once, which may be very time consuming, cycle counting enables you to maintain effective inventory control and determine inaccuracies quickly.
- Use warehouse management systems. Warehouse management and inventory control systems allow employees to track all items in an efficient manner and reduces the potential of human error. Barcode scanners, tags, apps, and other systems provide real-time tracking of inventory that is easily accessible within these systems.
Reduce inventory control costs
There are a few issues that can occur without inventory control processes—and all of them lead to increased costs for the organization.
Without an efficient process, items are hard to find, requiring more manpower and expenses. Without enough information to determine what supplies to order, there are shortages or overstock happens. With unreliable data, inventory forecasting is practically impossible. If there is a break in the supply chain, there’s no back-up plan and items may not be shipped on time. Customers will notice the pitfalls and avoid doing business next time.
You can reduce inventory control costs by having a process in place, with a back-up plan in case problems happen that are out of your control. An automated inventory control system can help.
How to automate inventory control
Automated inventory control gives you the ability to maintain greater oversight of your stock by removing the potential for human error. It can give you more complete data, which means more productivity and revenue potential.
Claris FileMaker can help with inventory control by providing a way to track products from the moment they enter the warehouse until the time they leave. It offers barcode scanning, label making, data management, reporting, and other features that help ensure your warehouse operates efficiently.
Automated inventory management also frees up time and energy. It can help keep track of processes without a large investment of manpower.
Claris FileMaker makes it easy to manage the entire warehouse process from beginning to end. It allows you to develop and deploy custom apps on mobile, tablet, or desktop. It’s secure and scalable, and connects to existing technologies. Claris FileMaker lets inventory managers create hassle-free supply ordering, superior inventory tracking, accurate sales data, current shipping information, and more—all in one easily accessible place.
A high-quality and effective inventory control system is truly essential. When done well, it leads to more productivity, greater customer satisfaction, and increased profit—benefitting organizations, employees, and consumers alike.
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