4 Pro Tips to Reduce Inventory Inaccuracy and Improve Your Numbers

 Maintaining accurate inventory is essential for several reasons. Not only does it help you keep items in stock for customers, but it also helps you control costs. For example, if you’ve got a bunch of inventory that never moves, you won’t know it isn’t moving unless you’re accurately keeping track. 

If this happens, you could end up sitting on unused inventory for years that ties up your funds. On the other hand, if you don’t meticulously track your inventory, you won’t know when popular items are selling out, which will result in empty shelves and lost sales.

Accurate inventory is essential for running a profitable business, and if you’re struggling with this, here are some of the easiest ways to get things under control.

1. Table of Contents

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   Embrace technology

When it comes to managing inventory, whether it’s a small backroom or a large warehouse, nothing will help you more than technology. Manual methods to track and update inventory aren’t enough anymore because they can’t help you keep up with today’s demands. With technology, managing inventory every step of the way is easy and efficient.

 For example, automation supports inventory management in many ways, and this includes simple things like using barcodes and RFID chips to scan items in and out of locations. Automation technology can also help you predict outages so you can maintain a healthy supply of popular items and avoid empty shelves. You can even automate the ordering process when a certain threshold is met.

 When you use technology to manage inventory, you’re less likely to create errors that will negatively impact your business. You’ll also have more visibility into stock levels at any given time, which will help when you need to order more stock for holidays and other special occasions.

2. Create a system and use it

The best inventory management systems are ones that get used. Once you’ve created a system, make sure it gets used by everyone on your team. You will need to have a routine schedule for certain tasks, like inventory counts/cycles, and an ordering process. Having these systems is great, but they only work when they are used.

After creating an inventory management process, regardless of what technology you use to implement your system, make sure your company policy reflects the need to use that system. Don’t let people do their own thing or veer off course. Integrate your inventory management process into the workloads of the people who will be handling inventory and train them how to use your system correctly. You’ll probably need to change some things about the system over time, so be open to feedback about what may not be working.

3. Have a receiving system

One of the ways inventory can disappear without your knowledge is through a loose receiving process. When your team receives inventory from any source, it’s crucial to require every item to be checked in on the spot so that discrepancies can be addressed with the shipper.

For example, if you order 1,000 of a certain item, but you only receive half of the boxes, you have to tell the delivery driver at the time of delivery or there’s no guarantee you’ll get credit for the items you didn’t receive. Often, this just requires making a note on the invoice and having the driver verify your claim. If you don’t go through this process, you’ll think you have more inventory on hand than you actually do, and you’ll end up paying for products you never received. 

By creating a system for receiving inventory, you can train your employees to double-check deliveries to ensure everything has been received. Don’t pressure them to rush through the check-in process. Train them to take their time to count everything and never assume everything has been delivered.

4. Perform spot checks

Whether you have your in-house team perform full inventory, or you hire it out to a special company, it’s important to do spot checks once in a while. This will help you spot random errors and be alerted of losses possibly caused by theft.

 Good inventory management supports your bottom line

 Your bottom line depends on your ability to create and maintain an accurate inventory system. Whether you run a small or large business, it’s equally important to stay on top of inventory as it comes in, gets stored, and goes out to be sold or used. The better control you have over your inventory, the easier it will be to become profitable.