Why Using an Inventory Management Excel hurts your Business?

If you run a small business – or if you used to run one and your business has gotten bigger – you’re probably familiar with Excel. This versatile little piece of software is great for budgeting, accounting, scheduling, project management, customer relationship management and more.

In particular, Excel can be a really handy tool for inventory control and management when you’re just starting out. Whether you’re operating out of a garage or a small retail shopfront, Excel is great for small businesses with small staff, small inventories and a small customer bases.

But if your business starts growing (and that’s really the goal, right?) then it should quickly become obvious that Excel isn’t made to scale and grow with you.

Here at Goods Order Inventory System, we focus on giving high-growth brands the ability to scale. The importance of having an inventory management software that grows with your brand is a key factor in making the switch. The ability to maintain visibility into inventory analytics through dozens of different reports is imperative to a brand’s success, and here are seven key reasons why transitioning to one makes

  1. Lack Inventory Tracking

Inventory Management Excel lacks the ability to track inventory in real-time which often translates to backorders and missed sales opportunities. This means that inventory management in Excel will not update inventory levels, and will not sync your sales channels accordingly.

When your customers are able to purchase items on backorders, they will be disappointed to learn that the item won’t be shipped to them either until you get the item back in stock, or at all. This negative customer interaction often results in expensive customer support hours spent fixing the problem and courtesy discounts and promotions that would not have otherwise been given.

Chances also are, this happens to more than one customer during that time.

With inventory management software like Goods Order Inventory System, you can set low-stock thresholds, safety stock levels, and ensure that you are never experiencing out-of-stocks, even during the busiest times of the year.

  1. Data entry errors

The larger your inventory grows, the more likely you are to experience data entry errors. It’s tough enough to keep track of small volumes of inventory, but with larger volumes of product flowing in and out of your business premises it becomes more difficult to keep track of the correct numbers of what’s come in, what’s gone out and what’s still to arrive – and it also becomes more difficult to find the time to double-check those numbers and catch any errors. The end result is that you might end up recording incorrect figures in your Excel spreadsheet, and those incorrect figures might stick around for days, weeks, months or even years.

  1. Shortages and overages

When you’ve got incorrect figures recorded in your inventory software it’s difficult to accurately forecast how much stock you need to order and how often you need to order it. You might end up ordering too much of a certain product and be forced to sell it at a discount to reduce your inventory, reducing your profits in the process. You might also order too little of a certain product, resulting in shortages and forcing your customers to look elsewhere for the product.

  1. Excel lacks real-time inventory data

At any time, your Excel workbook could be out-of-sync with your actual inventory count.  If you haven’t updated inventory numbers, what you see in Excel may not reflect what you actually have on-hand.

  1. Excel also limits your ability to quickly analyze historical data

Effectively managing inventory requires you to know how much of a certain item you need on-hand during different seasons.  The ability to forecast inventory need is integral to meeting your customers demands.

  1. Confusion in the office

Unlike a lot of online inventory management solutions that use the cloud to sync across a range of different devices, Excel spreadsheets have to be saved locally and distributed. As your business grows, more people will need to be able to access and alter your inventory management data. This can get difficult to keep track of, especially if you haven’t set up clear chains of command for communicating and entering inventory data. It could even result in you using out of date inventory data as the basis for all your future orders!

  1. Confusion across offices

Take all of these problems, and imagine how much bigger those problems would become if you were using one Excel file to manage inventories across two or more warehouses — the stress would get unbearable!

There will always come a point in a business’ growth where Excel becomes inefficient, confusing, unreliable, more trouble than its worth. At that point, your best bet is to move on to a cloud-based online inventory management solution. These software solutions can sync up across different devices, making it easier to keep your employees up to date with what’s happening with your inventory. They create certainty and make it easier to catch unforced errors, and often come with lots of other features and perks that can streamline your business further, like:

  • Intelligence reports on your inventory data;
  • Business-to-business eCommerce;
  • CRM management; and
  • The ability to sync across other platforms and software solutions.

Find out more benefits of cloud-based inventory management software.

Contact us for a detailed DEMO of the Goods Order Inventory Management Software.

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