For many companies, management of inventory with software such as Sage 50 is one of the
most critical issues for the business. Having too much stock on hand is costing you money, while having too little is costing you sales. It’s very much a case of needing a ‘Goldilocks’ solution – a way of making sure that your stock levels are ‘just right’.
Nobody said that running a business was easy! But for those who take in stock, hold it for a period, then sell it, life can be even tougher. Nothing is more annoying than not having enough stock when that big order comes in, and there’s no guarantee that by the time you have restocked, the customer may not have gone elsewhere.
And if the customer goes elsewhere, there’s no guarantee that he’ll come back. Or in certain cases, you may look to source emergency stock, at additional cost to the business. Either way, it’s a bleak outcome for the bottom line.
But what about the opposite side of the coin? What’s the problem with having a level of stock in place that’s greater than you actually need? The problems are numerous. Holding an oversupply of stock can cost you money in warehousing, insurance, depreciation – and it may even be taxed as an asset in certain cases. It means that valuable capital is tied up in unsold inventory, which may cut off other opportunities for the business that require financing.
You can see from the above why more and more companies turn to Sage 50 for its ability to help you manage your levels of stock – with a whole host of critically important benefits. The best small business accounting software is obviously the software that makes the biggest contribution to your bottom line, and stock management software very definitely fits the bill.
No matter what the product may be, more and more consumers check out prices, availability etc. online. 24 hours a day, they can compare features and benefits – along with price. Think of what happens, then, when someone visits your site to find out that the product they need is out of stock, whether temporarily or long-term. But by having instant access to your stock levels, you can make sure that you fulfil your customers’ orders quickly and simply, without giving them an ‘excuse’ to check out your competitors.
The quicker you can fulfil an order, the quicker you can dispatch it, invoice it and get paid. And getting paid is obviously the lifeblood of every business. And if you automate all these elements, collecting cash gets really easy compared to competitors that have to restock before they can start the process of invoicing and chasing cash. Investing in the best small business accounting software obviously includes stock management software – so don’t overlook it next time you’re budgeting for your software spend.
It may sound simple, but having the right stock in the right quantities at the right time is critical to success. But it’s a lot more difficult than it sounds. As mentioned earlier, running out of stock or having too much inventory will each have an effect on your bottom line. But with effective software in place, you have real-time information on stock, letting you react to either too much or too little. You can also avail of historical sales to predict future demand, minimising stock-puts or overly full warehouses. All of this functionality is readily available when you invest in the best small business accounting software.
For a small business or those without a strong banking history, having enough working capital is a huge challenge. And whatever capital you have obviously needs to be put to best possible use for your company. It’s little short of a crime to have capital locked up in a stuffed warehouse.
But with more accurate forecasting and the automation of routine and recurring stock management functions, you free up that working capital for areas of the business that need it most, whether it’s marketing, new premises etc. And because you’re viewing stock information in real time, the decisions you make will be more professional and better informed. With this in mind, investing in the best small business accounting software you can afford obviously makes sense.
It’s been said time and time again that managing your stock is as important for your business as managing your cash. Both should be treated with equal care and attention. So if you reconcile your bank account every week, it makes sense that you’d do the same with stock. And remember that a modern stock control system will provide real-time information, so you’ll have information at your fingertips that can transform how you manage your stock.
You can easily automate reordering of stock when it drops below a certain level, and drive down the average number of days that you hold stock. This makes as much sense whether you’re a smallish restaurant or a white goods superstore.
Overly complicated menus in a restaurant or a crazy level of choice of fridges in a white goods store are both examples of letting your heart rule your head. Focus on quality rather than quantity. Your customer will thank you for it and you’ll immediately notice the benefit to your cash flow and to your bottom line. Yet another reason for investing in the best small business accounting software.
Effective stock control software will provide a mass of really useful management information. Make sure you use it to its fullest potential, whether it’s planning ahead for busy periods, seasonal sales, or perhaps getting ready for a shoulder period.