As a manufacturing business, you must have faced challenges with maintaining stock levels, cash flow and customer satisfaction. Many businesses also have to deal with a lot of dead stock and excess stock. This makes inventory management even more complex. A business also has to analyze past inventory levels to make smart decisions. A stock management system helps you with that. It takes over your stock management and simplifies it.
In this blog post, we will understand what is stock management. We will also look at the importance, features, and benefits of having a stock management system, specifically for SMEs in the manufacturing sector.
What Is a Stock Management System?
A stock management or stock maintenance system is used to track, manage and maintain inventory levels. The main goal is to avoid understocking and overstocking. Furthermore, it also helps you track the availability, location and condition of your inventory.
It also helps with sales tracking and purchase tracking. It can be integrated with the procurement or purchasing module to automatically update inventory levels. Integrated stock management system also has reports and analytics features that help you understand which products are selling well and which are not. All in all, it takes care of all the many components of inventory management.
Why Is a Stock Management System Important?
A stock management system is very important for all businesses, especially SME manufacturing businesses. It helps you understand and fulfill your customer demand and avoid wastage and overstock. Now, that you have understood the meaning of stock management, let's understand its importance:
1. Real-time Tracking: A stock management system provides real-time tracking of inventory. It helps businesses find low stock levels and restock accordingly.
2. Customer Demand: Monitoring inventory levels helps you find trends and patterns over time. This helps you predict demand and avoid understock and overstock.
3. Improve efficiency: Real-time tracking you to identify operational bottlenecks across your organization. This gives you time to respond to faulty areas.
4. Risk Mitigation: An effective stock management system makes sure the best stock levels are maintained at any given time. This prevents customer dissatisfaction and wastage.
5. Streamline operations: A stock management system allows you to automate several manual processes. This leads to streamlined operational processes across your manufacturing business.
How Does a Stock Management System Work?
A stock management system tracks your inventory end to end, right from receiving supplies to dispatch. The main purpose of stock management system is to record, track and improve the visibility of your inventory. To do this, the system gives you various data points like inventory levels, stock turnover, supplier performance and many more. This helps you to make more informed decisions.
Another purpose of stock control system is managing inventory with a barcode scanner or RFID (Radio-frequency identification) technology. This makes it easier to track the lifecycle of your product. This allows you to stay on top of your stock, reducing costs and improving customer satisfaction.
Common Features of Stock Management System
A stock management system is a complete tool that improves your inventory. Here are the most important features and purpose of stock management system:
1. Automated reordering: This feature allows you to set reorder triggers. When those triggers are hit, the system automatically places an order for a specific product.
2. Inventory Tracking: The system also lets you track your stock in real-time with the help of technologies like barcode and RFID. This keeps track of the item at every stage from purchasing to dispatch.
3. Multi-location inventory: An important purpose of stock control system is to manage inventory across multiple warehouses. It lets you transfer inventory between and from multiple warehouses within your business.
4. Mobile compatibility: Stock management systems work on a cloud server. This allows users to keep an eye on things and perform tasks on-the-go with remote access.
5. Delivery management: This helps you track the delivery status of your products so you can keep a check on whether they've been delivered on time and in the right amount.
6. Reporting and Analytics: An effective stock management system allows you to generate various kinds of reports that help you find trends and make predictions on the basis of that.
7. Purchase and Sales Management: Creating, tracking and managing purchase and sales order is an additional purpose of stock control. The system predicts purchasing needs based on the reports from inventory.
Benefits of Stock Management System
Having a stock management system has several benefits for all businesses. Here are the most important ones:
1. Improved efficiency: This system reduces manual stock entry errors and improves collaboration between teams for real-time stock updates. It keeps the entire team on the same page and avoids understock and overstock.
2. Increased visibility: The system provides manufacturers higher inventory control and visibility across multiple warehouses. It uses barcode or RFID technology to update the product status at every stage.
3. Better Decisions: The system provides accurate stock insights and inventory input, output and other movements. This helps businesses make smart decisions and predict the demand and requirement for raw materials.
When Should a Company Start Using a Stock Management System?
The system becomes important when you start struggling to keep track of your inventory levels or forecast demand for your products accurately. But, a business should consider implementing a stock maintenance system project from the beginning. This is especially important if they have a vast product line. Additionally, as the business expands, it becomes more difficult to manage inventory manually. You shouldn't wait for problems to come up to start a stock management project.
How to Choose the Best Stock Management System?
Finding the right stock management system for your business can be a difficult task. However, you can consider the following factors to help you make the right decision:
- Consider a stock management system that scales with your business.
- It should integrate with other software like production, procurement, and accounting systems.
- User-friendliness and responsive customer support are also important factors.
- Compare the ROI of the product against the cost of the product and see if it is beneficial.
- The software should have remote access for continuous task management from any device.
Elevate Your Stock Management System Today
A stock management system will completely change the way you handle your inventory. TranZact is software that is specifically made for Indian SME manufacturers to help them with their inventory. It supports many features like barcode and RFID tracking.
TranZact also comes with a sales and purchase module that automatically reflects all the changes in the inventory. It has a dedicated inventory dashboard that provides you with a quick overview of your inventory status. It also comes with a reports and analytics module that you can use for improved decision-making. Book a free demo of the software to understand how it can improve the way you deal with your inventory.
FAQs on Stock Management System
1. Which is the best stock management system for small businesses?
TranZact can said to be the best stock management software. It offers barcode scanning features along with negative stock restriction and reordering automation tools to streamline your inventory operations. It's integrated with production, material requirement planning and procurement modules to allow higher stock control.
2. What is the difference between a stock and inventory management system?
An inventory management system allows you to track and manage your inventory levels, quantities and even the movement of your products within your warehouse. On the other hand, a stock management system is a comprehensive tool that allows you to manage the sales, distribution, and purchase of your products.
3. What is stock management system?
Stock management system is a tool that helps businesses track and manage their inventory levels. It helps you make sure that you have the right products in the right quantity at the right time.
4. What is the importance of stock management?
Stock management is important for manufacturers because it prevents overstocking and understocking. It also reduces storage costs, improves cash flow, and ultimately improves customer satisfaction.
5. What is the purpose of stock maintenance system?
The purpose of stock maintenance system is to make sure that the stock is maintained at optimal levels, reducing wastage and loss. This makes sure that you are able to fulfill customer demands at all times.
6. What is inventory management system project?
It refers to the project that involves the development or implementation of an inventory management system. It is a complicated process that requires complete planning.
7. What is stock in inventory management?
Stock in inventory management refers to the goods and materials that a business holds for the ultimate goal of resale, production, or utilization.
8. What is the problem statement for the inventory management system?
The problem statement for stock maintenance system is the lack of real-time inventory data, overstocking, understocking, and inability to track inventory across multiple locations. They are common problems that an inventory management system aims to solve.
9. How do you monitor stock levels?
Stock levels can be monitored using a stock monitoring system which tracks inventory in real time. It also sends alerts for low stock levels and helps in making informed restocking decisions.
10. What is an example of stock management?
The best stock management system example could be a retail store using a barcode system to track products and manage inventory levels effectively.
11 What is stock inventory management system?
It is a system that oversees the monitoring and maintenance of stocked products. It includes company assets, raw materials and supplies, or finished products ready to be sent to vendors or end consumers.
12. What is stock maintenance system?
A stock maintenance system tracks stock levels, orders, sales, and deliveries. This makes sure of optimal stock levels, prevents overstocking, and avoids stockouts. It improves accuracy, cost efficiency, and customer satisfaction through automation and real-time updates.
