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Inventory is the heart of any company that markets tangible products regardless of their size. Maintaining a stock that allows to fulfil the purpose in time and form with all the orders of the clients is indispensable to reach the goals of sale of the company, remember that this last one is basically the source of sustenance of the same one.

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A good control of inventories can become a great ally to increase the profitability of the organisation, however; only some of the businesses are concerned about investing resources that optimise and improve stock conditions and end up making mistakes that undoubtedly generate various effects on the company. Some common examples are:

Excessive inventory: One of the most frequent mistakes that some companies make is to keep a store saturated with products to “ensure sales”. However, this is a strategy that induces lack of control, affects liquidity, increases the likelihood of shrinkage and decreases quality especially in those perishable products.

Lack of records and information: When you do not have a record and inventory history, you make the serious mistake of improvising. Ideally, purchases should be supported with information that details the flow of each product, such as the inputs and outputs of the store.

Insufficient inventories: A company whose inventory does not have the capacity to meet customer demand generates poor service quality, lower sales and increases the likelihood that customers will turn to competitors to meet their needs.

Loss of raw material: When excessive supplies are made without estimating a projection of the sales, there is a risk that the products expire, they lose quality, thus failing to fulfil the customer’s expectations or, in the worst case, they are not sold.

Theft: When there is no inventory control, employees may be tempted to steal, increasing costs and decreasing the profitability of the business.

Disorder: Can you imagine offering a product to the customer without knowing the quantity of pieces available in stock? When there is no control in the inventory, this type of situation occurs without doubt affecting both the utility of the business and the perception that customers have of the company when they cannot meet their expectations.

How to increase productivity of your company with inventory control

Everything that allows you to save and control each of your company’s assets helps you to be more productive and generate more profit. Experts say that when a company has a synchronised and fair inventory for sales that are estimated to have, is much more productive, does not waste resources and does not suffer from problems such as having an inventory full of products with low turnovers and lack of money to replenish those who do rotate; leaving behind the old theory that companies with overflowing inventories are the most productive and successful.

Also, it allows them to know those responsible for this work which are those products that produce more profit or profit for the company, so that priorities can be established and focus efforts on those sales that are of greater benefit to the business.

Maintaining a controlled inventory is not difficult and impossible, as long as you have the support of technological tools such as ERP software, which offer up-to-date information available at all times. An ERP system such as SAP Bussiness One, can help you get the most out of your inventory and of course increase the utility of your company.

With the support of tools such as ERP software that include inventory control, warehouse work is not only done in a much more agile and simple way, but also gives your company the opportunity to reduce costs and increase profits.

Also, vehicles and resources used to improve inventory management play an essential part in the process as well. With our trailers, at Trailer Supplies, you can ensure your merchandise is delivered properly.

Below we describe some ways in which an inventory control software can help increase profits in your business:

  • It allows to consult the products with descriptions and exact quantities and in this way identify those that have less rotation to offer discounts or carry out some other type of promotions that help to sell them easily.
  • By detecting the items that sell the most pieces, it is possible to negotiate with the suppliers the application of discounts on purchases for greater volume.
  • It helps to avoid the losses that cause additional costs.
  • It allows to track the products and avoid possible losses or thefts thanks to the handling of numbers of series and batches.
  • Having precise information on the reorder points of each product avoids unnecessary replenishment and therefore the costs that these generate.

For companies that handle seasonality and that may have variations of products and quantities in their inventories throughout the year, it makes it possible to identify with greater clarity the demand of the market and anticipate changes by managing stocks in order to cover in time and form with the needs of the customers.

It also allows for a better planning of the cash flow of the company, since having knowledge of the different movements of the inventory, as well as the dates in which orders must be made, refills and when they must be paid, it is easier to know how much money is required to have available to cover these costs.

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