The Importance of Inventory Control System

Managing huge stocks of a product is one of the most important jobs of wholesalers. A business must be having enough space for storage purpose, together with a supply management system in place, in order to be classified as a wholesale business. Inventory control is not limited to the wholesale businesses, even a small retail store needs to have some inventory management systems in place. Inventory control is not only about storage, as different reports generated with the help of inventory control system will assist management in making many important business decisions. Therefore, when you are going to start a wholesale business, along with many other decisions you also need to choose an inventory control system that will suit your requirements. For example you should pick out between perpetual and periodic recording system or decide on the stock valuation method (FIFO, LIFO, etc). Do not take this selection lightly as it can affect your wholesale business in many ways. Earlier, inventory control systems were limited to manual entries being made on registers, then computers took the place of registers, still the inventory management required manual entries in computers. These entries were made by humans, who are bound to get it wrong every once in a while. When it comes to keeping inventory records, even a minor mistake can result in a lot of confusion and wrong decisions. Luckily, nowadays we have got a number of high-tech inventory control systems with advanced tools like Radio Frequency Identification reader at our disposal. However, barcode is the most commonly-used method for inventory control, which is quicker and error-free to a great extent. A number of different softwares are available in the market and some of them are free to use. When choosing any of these inventory management systems for your wholesale business, consider the factors like price, training, and future requirements, going for an ultra modern system when you could have done with a basic barcode system can easily be counter productive. Choose your software carefully, since it will not be easy to convert from one type of inventory control system to another, if it doesn’t work out well. Inventory control system, as suggested earlier, is not all about keeping a record of inventory. A very important part of inventory control system is the built-in purchase order function. You can implement a manual procedure for that, but an automated system can prevent your wholesale business from a lot of fraudulent activities. Other functions of inventory control systems include accurate stock records, expiry dates management, cost of goods sold, and inventory replenishment.

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