how smart inventory tracking improves your bottom line

Last Updated On October 01, 2019 / Written By Michelle Jaco

How Smart Inventory Tracking Improves Your Bottom Line

In this article, we will discuss in detail what inventory means to your business, how to track and monitor it, and how to manage it. A strong knowledge and understanding of this will contribute to the growth of your business.

Introduction

Companies that have adapted to the latest technology by digitizing their corporate structures have a competitive advantage over those who do not.

Technological advancements improve daily activities in an organization. It affects all departments in the corporate structure. As a result, this helps to increase a company’s operations, management, and productivity.

Not only will you have an easier time running your business, but you will also generate more profit in the process. Business software gives you some assurance that your business will grow stronger as time passes.

The imperative role of the integration of technology into a business can never be emphasized enough, as the impact it makes is ample evidence.

All this is sufficient reason why you should be at the forefront in digitalizing your business, no matter how small or large it may be. The good thing is that software solutions can easily be integrated.

We will specifically take a dive into the utilization of inventory tracking programs for restaurants. Regardless of the type of business you run, the fact remains that you have much to gain from the proper utilization of an inventory tracker.

In this article, we will discuss in detail what inventory means to your business, how to track and monitor it, and how to manage it. A strong knowledge and understanding of this will contribute to the growth of your business.

How Inventory Affects Your Business

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By the business definition, the term inventory refers to the list of tangible products and/or goods within a business. This figure is calculated in every accounting period. It is used to determine whether the business made a profit or took a loss during a given period.

Necessary actions can be taken to ensure it follows the path that facilitates further growth for your establishment. In addition, inventory can be labeled as an imperative metric tool used to analyze and alter the performance of a business.

Inventory is classified as a current asset in the balance sheet. The value of inventory in a business is used to determine the net worth of a business. In actuality, the term inventory is broad in context because it extends to all the items meant for sale within a company. For restaurants, for instance, it extends to include dishes served and the ingredients used to make those dishes.

In such instances, inventory management determines the success of your business significantly. One needs to be assertive to make sure that every product is purchased on time, is stored appropriately, and consumed in time. To do this, one is required to have hands-on information about every part of the inventory in your business/ restaurant. Technological advancements have helped simplify this issue through inventory management software.

This brings up the query, “What is required for a good inventory system?”

Provided is a list of the fundamental assets that are required for your inventory tracking system to be deemed acceptable.

Taking inventory has never been easier. Try it free.

Characteristics of an Optimized Inventory System

Increase Accuracy of Information
Automated monitoring is done by machines. Unlike humans, machines do not make errors. Information is fed in using barcodes and scanners to scan inventory. This automated monitoring of stock aids in granting succinct and steady information. This information is available ubiquitously.

Improves Operations
If you have a good inventory system in your workplace, you save time in managing the stock by avoiding supply discrepancies. Inventory trackers provide convenient stock keeping and management tools. It provides real-time information, which helps in formulating your company’s supply orders for the next cycle, either long-term or short-term.

Provides Inventory Control
The users of inventory systems should possess full control and oversight of the current levels of inventory and its distribution, along with all related information. This will help to ensure there is a steady supply of products without either an oversupply or an undersupply of products.

In-House Inventory Tracking

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In-house inventory tracking refers to the structured systems and policies that are used to observe the movement of stock/inventory within a business.

For a restaurant, there are different recipes for the distinct meals. This means that the inventory about each of these products ought to be kept in check. Otherwise, there will either be an oversupply or an undersupply of products. Both of these extremes will reduce the amount of revenue to be generated. Therefore, stock should be moderated accordingly.

The use of an inventory tracker will do this for you. All you have to do is integrate it into your business. This software will simplify your inventory management needs. In doing so, you will reduce labor costs because there will be no need for extra personnel to do the inventory tracking. This application is completely effective when it comes to utility.

Businesses that are early adopters have embraced even more advanced inventory tracking methods with the use of inventory tracking software. These computer applications cater to the entire stock flows by automating the entire process.

These tracking systems give automated updates on all the transactions that have been made. Information that is relayed will be timely, accurate, and readily available.


Methods of Inventory Tracking

There are different ways to keep track of your inventory movement. Whichever way that you will opt for will depend on your personal preferences. Here is a list of the prevalent inventory tracking methods that are used.

Code Description Use
Businesses and restaurants can use codes to distinguish items in their inventory. This code will show the usage of the involved products, essentially taking a digital log of every time an item is expended.

Data about every item is recorded and one is informed about what needs to be replenished and when. This will facilitate a better mode of operations.

The inventory tracking methods you decide to use can be customized into your preferred choice of software that suits both your personal needs and all of your business needs. What is most imperative is to tap into all the advantages of inventory tracking.

Identifying the succinct benefits gained from the best inventory tracking software on the market is a fundamental requirement.

Taking inventory has never been easier. Try it free.

Significance of Inventory Tracking

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Labor Expenses
The cardex inventory management system is a manual process that is also very labor-intensive. It is very labor-intensive because one needs to regularly write on the cards during a sale or purchase and requires personnel to help keep a full record of this data.

The number of personnel required may vary according to the size of your establishment. If your company is larger, then you will house more inventory and require more employees to track your inventory and vice-versa with a smaller business.

Through the use of tracking software, this process will be eliminated, and the number of employees needed to fulfill this task will no longer be required. This will lead to saving on labor expenses.

Facilitate Convenient Customer Service
The success of your company is determined by how well you can supply your consumers with your product.

Example - An interested individual wants some catering services for an impromptu party the next day and calls Restaurant A, who is unable to fulfill the client’s request because they ran out of a key ingredient to prepare a specific dish. As a result, Restaurant A had to turn down the request and not only missed out on a sale but also a potential future client, which will ultimately affect their reputation moving forward.

Having to resort to Restaurant B, the client requests to use their catering services. Restaurant B uses inventory tracking software and is well-stocked and prepared, ready to take on the large catering order. With an accurate record and ample stock, the second restaurant accepts the offer and delivers the service.

Thanks to inventory management software, restaurant B offers more convenience than A did. The consumer will certainly consider restaurant B for another gig before A.
Management of Inventory Expenses
As we had discussed earlier in this article, management software helps in assuring that all inventory expenses are kept in check. This helps to track and account for the amount of inventory purchased, without exceeding the required amount that has been calculated by the previous volume. It ensures that stock is neither in excess nor inadequate and that money is spent properly to maximize the profit generated.

Now that you know all about inventory tracking software and why you need it in your business/ restaurant, the next step is to identify the best software in the market. It should help accurately track the movement of your stock in real-time, further assisting in maximizing profits and saving in costs.



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