Poor inventory management in an Indian SME Manufacturing company can lead to stockouts, overstocking, and dead stocks. It can also cause delays in production or increased inventory costs and affect overall profits. TranZact helps you avoid all situations like stockouts and overstocking and allows you to use different strategies to simplify your inventory management.
In this blog post, we will learn how to manage inventory efficiently with TranZact to increase the overall productivity of your manufacturing business.
What Is Inventory Management?
Inventory management is the process of analyzing production targets and sales orders to have the right amounts of raw materials and finished goods in the warehouse of manufacturing businesses. It also focuses on semi-finished goods, consumable items, spare parts, and other products to improve transparency and reduce disruptions in production processes. Once you learn how to track inventory in real time, it will help you make informed decisions and improve your manufacturing processes.
To learn more, read here - What Is Inventory Management? Types, Benefits, and Techniques Explained
Why Is Effective Inventory Management Crucial?
Effective inventory management is important for SME manufacturers in India due to many reasons. For example, if your inventory is not aligned with your manufacturing goals, then it can cause production delays, customer upsets, and loss of sales.
Overstocking raw materials can result in dead stocks and increase your inventory holding costs. Effective inventory management also requires having good relationships with multiple suppliers so that you can buy raw materials in emergency situations.
It also helps you improve cash flow and demand planning to increase the profits of your manufacturing business.
Effective Inventory Management Strategies With TranZact
It is important to make practical inventory management strategies based on your unique requirements. TranZact is an effective inventory management system for SME manufacturers. Let’s learn about how TranZact can fulfill inventory requirements.
1. Just-In-Time: Just-in-time orders raw materials after detailed production planning. TranZact provides accurate MRP reports, reducing holding costs and improving demand management.
2. Economic Order Quantity (EOQ): EOQ analyzes demand rates and storage costs to order the right quantity of raw materials. TranZact helps analyze factors to use the EOQ strategy for better purchasing decisions.
3. Safety Stock: Safety stock avoids production disruptions during emergencies. TranZact allows adding multiple warehouses for improving order management.
4. Reorder Points: Reorder points prevent overstocking and inventory shrinkages. TranZact sets stock limits and sends alerts on WhatsApp or Email when reorder levels are reached.
5. MRO Inventory Management: MRO focuses on daily maintenance and repair products. TranZact manages vendors, integrates work orders, and offers a centralized dashboard to avoid production disruptions.
6. FIFO: FIFO (First-in-first-out) makes sure the use or sale of older inventory first. TranZact helps categorize and utilize raw materials and finished goods in FIFO order.
Inventory Management Techniques Enhanced By TranZact
TranZact helps you analyze the previous production data and demand rates of different products so that you can use the right methods of managing inventory. It also allows you to analyze the performance of your suppliers to make informed decisions when choosing inventory management techniques for your manufacturing business.
Techniques For Inventory Management
There are different methods of managing inventory. Let’s learn about different inventory management techniques that you can use with TranZact to improve your business productivity.
1. ABC Analysis: ABC analysis categorizes items into A, B, and C categories based on their value. TranZact allows unique IDs for inventory items and categorization by monetary value.
2. FSN Analysis: FSN analysis categorizes items as fast-moving, slow-moving, or non-moving. TranZact helps analyze demand rates and categorize inventory accordingly.
3. SOS Analysis: SOS analysis organizes inventory into seasonal and off-seasonal categories. TranZact helps to provide accurate inventory levels for high-demand products and avoids overstocking off-seasonal items.
4. SDE Analysis: SDE analysis categorizes items by purchase difficulty. TranZact helps identify items that are less, difficult, or easy to obtain and categorizes them into S, D, and E categories.
Step By Step Inventory Management Process Simplified With TranZact
TranZact is the best inventory software for small businesses to increase efficiency. Let’s learn how it helps you simplify the step-by-step inventory management process.
Step 1: Add details of all inventory items such as raw materials, finished goods, semi-finished goods, consumable items, and other products.
Step 2: Create unique IDs for each inventory item.
Step 3: Categorize each item according to your selected technique of managing your inventory, such as FIFO, ABC analysis, FSN analysis, etc.
Step 4: Set minimum and maximum stock levels for each inventory item to avoid stockouts and overstocking.
Step 5: Set reorder points for each inventory item to make purchases on time to avoid disruptions in processes.
Step 6: Get alerts and notifications through WhatsApp and email when reaching min/max stock levels.
Step 7: Create purchase requisitions and set guidelines in the system to automate the approval process.
Step 8: Send RFQs to multiple suppliers and select the one that offers you the best deal.
Step 9: Create purchase orders, send them to your selected suppliers, and track their status.
Step 10: Once raw materials arrive at your warehouse, create an Inward and check their quality to make sure that all criteria are followed by your supplier.
Step 11: Add multiple warehouses in the system to be able to manage them from one place.
You can also create documents like delivery challans and invoices and increase transparency in your dispatch process.
Best Practices For Effective Inventory Management Using TranZact
You need to follow the best practices according to your unique requirements for effective inventory management. It will help you improve your inventory control and business productivity. Here are a few inventory management best practices you can follow while using TranZact.
- Categorize inventory items based on their value.
- Track current stock levels to set production targets and make informed purchasing decisions.
- Get MRP reports to buy raw materials in the right quantities.
- Send RFQs to multiple suppliers to order your raw materials from the best one.
- Set reorder points for each raw material to avoid stockouts.
- Integrate barcode technology to speed up processes and improve inventory accuracy.
- Use different strategies and techniques according to your specific requirements and minimize inventory costs.
Choosing The Best Inventory Management Software For Small Business
If you want to choose the best inventory management software for small businesses, then you have to analyze a few factors. Here is how to choose the right software:
- Decide if you need to implement it on-premises or access it through cloud computing.
- Decide your budget and your business requirements.
- Look for integration capabilities of inventory management software with other tools.
- Find if it allows you to use different strategies and techniques for managing inventory.
- Consider implementation time. It should not take longer periods to prevent downtime.
- Choose software that helps you create all documents involved in inventory management.
- Check the record-keeping feature to access the important data at a place.
- Calculate the investment you require to train your employees.
Read the Comparison between Odoo Inventory vs TranZact
Simplify Your Inventory Efficiency With TranZact
TranZact allows you to categorize items based on their value, source of supply, expiry dates, units of measurement, and more with increased efficiency. It is a cloud-based software solution and the best inventory management software for small businesses in India. TranZact offers you unique features for manufacturing businesses with an easy navigation panel. It is made for Indian SME Manufacturers. It allows you to use multiple inventory management techniques inside to improve operational efficiency.
Get TranZact implemented in your manufacturing business in just 14 days to improve your inventory control and business productivity.
FAQs
1. How can TranZact help manage inventory in a small business?
TranZact helps manage inventory in a small business by providing unique features to track current stock levels, set min/max levels and reorder points, and improve communication with suppliers and document management.
2. What inventory management techniques can be enhanced with TranZact?
Many inventory management techniques can be improved with TranZact, such as FIFO, ABC Analysis, FSN Analysis, and more.
3. How does TranZact improve the inventory management process?
TranZact improves inventory management by creating RFQs, fast-checking raw material quality, assigning unique IDs, categorizing items, sending reorder alerts, and recording all documents.
4. What are the benefits of using TranZact’s inventory management software?
The key benefits of using TranZact’s inventory management software are as follows:
- Real-time updates
- Setting min/max levels
- Alerts via WhatsApp and email
- Reduced inventory costs
- Reduced disruptions in production processes
5. How does TranZact compare to other inventory management software for small businesses?
TranZact is the best inventory management software than other software for small businesses. It offers all the features in one platform to automate and improve inventory management processes, including an easy-to-use dashboard, integration capabilities, and customization options.
6. What are the best practices for effective inventory management using TranZact?
Best practices with TranZact include using templates for RFQs, creating unique IDs, categorizing items by value or expiry, setting reorder points, and applying techniques like ABC Analysis.
