Inventory control in your business is something you should be concerned about. Having an inventory system designed specifically for the distribution business by Filipino engineers in the Philippines is well worth the extra time and money. Smaller businesses with five to ten employees may be concerned about tying up too much cash in stock, which can stymie the company’s growth.Larger companies with hundreds of employees may have more cash to spend, but it is also easier to over or under order if your logistics and sales departments aren’t communicating well.
Monitor your Purchase and sales orders
Purchase order is the item that you order for your business.POs are an inflow of stock and an outflow of cash, while your sales order is out of stock and inflow of your cash. Inventory control involves tracking your orders you should be able to track when the products that order arrived at your business and how much would it cost.
Revenue and cost
Another critical aspect of inventory control is the tracking of revenue and costs.When purchasing items on a PO, keep track of the total cost of each item as well as the taxes and freight charges associated with each order. These must be factored into a unit cost using the moving average or FIFO/LIFO costing method.When selling products on a sales order, keep track of the revenue per product, minus any discounts and taxes.You’ll be able to easily deduct costs from revenue and calculate the profit you’re making on each sale if you keep track of the revenue and costs associated with each transaction.
Inventory movement and stock levels
Your overall inventory level will rise and fall as you generate new POs and SOs. The current stock level is a snapshot of your inventory quantities at any given time, and anything that affects the quantities is referred to as an inventory movement.Inventory movements include sales and purchases, but there are a few others. A stock transfer occurs when inventory is transferred from one store to another.Stock adjustments are movements that occur when inventory levels are counted or corrected based on what is actually in the warehouse. A cycle count is a warehouse-wide stock adjustment.
Improve your inventory control with barcode scanning
Improper data entry is one of inventory control’s enemies. As you enter inventory movements, typos and other errors can occur, causing your records to deviate further and further from what is actually on your shelves.By reducing data entry, barcodes and scanners can help your business increase inventory accuracy.You can attach barcodes directly to items, allowing you to scan once instead of typing an entire name.
If you can reduce a longer item name, such as ABS600Y-T1, to a single beep of a scanner, you will greatly reduce the likelihood of data entry errors.
Although not all products can be barcoded, barcodes can usually be incorporated into your workflow.If you are unable to apply barcode stickers to your products, label the shelves or bins where they are located, or create a binder or list of barcodes to scan.
If you’d like to take the next step in inventory control, check out SystemSIA Cloud!