If you run a business that primarily sells some kind of product, then a lot of your job likely involves inventory management. You need to replace products as you sell them, but you don’t want to stock up faster than customers are buying. That requires careful monitoring of your inventory levels. 

Your inventory is likely to be one of your most significant financial assets at any given time. Your inventory items represent the amount of stored value that you can leverage to your benefit. Of course, that means that mismanaging your inventory will directly impact the health of your company. An unexpected glut or shortfall in your inventory will impede your growth and hurt your bottom line. 

Even business owners who don’t work in retail or directly selling products may still have many inventory needs. Restaurants need ingredients, and even service workers like plumbers or electricians need to have enough of the right materials to handle an emergency. All of those businesses rely on inventory management in their day-to-day operations. 

What is Inventory Management?

Inventory data can encompass anything and everything you have to manage your supply. Inventory management is the ongoing and real-time process of storing, monitoring and replacing your inventory, which can include completed products, raw materials, and any other regular supplies.   

Inventory management is about maintaining precise inventory records so you can track your inventory over time and plan accordingly. The more informed you are, the more prepared you’ll be to adapt to changing circumstances.  

What to Look for in Small Business Inventory Management Systems

When you’re trying to set up your inventory management system, you want an effective way to track your business inventory in real-time and reduce costs associated with insufficient planning. 

You need a system that you can quickly and efficiently adapt to you and your staff’s business process. If using the system requires upending your whole established way of doing things, it might not be the right choice.  

If you operate an online store or even an in-person retail store, you may want to consider POS systems. These are helpful for good inventory management with many transactions, as they involve recognizing and registering the change in inventory directly at the point-of-sale (POS). 

This way, any employee can intuitively update the official inventory quickly and automatically at the moment of the transaction. This kind of inventory management software reduces human error when an employee has to remember to register a sale later after the fact. 

For in-person retail, POS systems can involve barcode scanners. Each physical object and its barcode is already logged in your system, so all you have to do is scan the barcode to register the sale and change in your inventory. 

Why Should You Use an Inventory Management System?

Whatever your industry or business model, a reliable inventory management system may help you to increase your efficiency and lower your inventory costs. As your business grows, it will take more and more effort to keep track of basic inventory essentials, but it’ll never be a problem with a user-friendly system in place. 

Inventory control software that registers each sale can give you an automatic stock alert when it’s time to resupply. With a reliable and precise system feeding you the data, you can restock when it’s convenient, without having to worry about gluts, shortfalls, or unexpected cash flow issues. 

Recording every transaction is a good business practice for reasons beyond inventory management as well. A sound inventory management system will guide your small business bookkeeping and ensure you keep track of your finances as well as your materials. Recording each transaction at the point of sale is the backbone of good bookkeeping. 

Best Cheap and Free Inventory Management Systems for Small Businesses

There are many places you can go for inventory management solutions, and you don’t have to pay premium prices to get high-quality inventory control software that works for your small business. Here are just a few of the options that might be a good fit for your business.  

Zoho Inventory

Zoho is an online cloud-based inventory management system that offers affordable integrated services for small or medium-sized businesses. You can try them out for free, and their prices scale up according to the size of your business and the number of orders and transactions you have to handle. 

Zoho works well for online retail and includes reliable customer service, and it’s easy to upgrade the benefits as your operation expands.

InFlow

InFlow is another affordable option that works well, especially for smaller businesses. InFlow can be used effectively for free for on-site retail without too high a volume. It gives you control over the whole system and lets you put the cloud to work for you. 

Like your small business, it’s adaptable. You can access it from anywhere and use your phone for everything from inventory tracking to barcode scanning.  

Upserve 

Upserve is a powerful inventory solution for small businesses in the food and beverage industry. Bars and restaurants have specific inventory and accounting needs, and Upserve is a popular choice for providing the solutions. It’s a POS system built for restaurants and easy to adapt to your company. 

SellerCloud

SellerCloud specializes in online retail, and it’s a popular and powerful option for connecting and selling your goods on multiple platforms across the internet. It’s more expensive of an option than some, but it gives you a single carefully managed inventory site through which you can make sales on a variety of channels. 

Sortly 

Sortly is an effective and affordable inventory management choice for non-retail businesses, including technology, construction, or medical service companies. Their program can be a tremendous help for organizing and tracking your inventories of tools and assets, and you can use their software for free. However, some capabilities won’t be available without paying.  

Investing in Your Small Business Future

For your business to succeed, you need to be organized and in control. Get started today by trying out a cheap or free inventory management program. If you’re unsure how to proceed or what your company’s needs are, consider consulting with an accountant. 

A professional accountant can help create small business growth. It takes planning, research, and careful attention to detail, but you’re not doing it alone. Work with a financial expert today to consider how you can streamline your business processes and take control of your company’s direction. 

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Written by Brendon Pack

Brendon Pack is Chief Revenue Officer (CRO) at 1-800Accountant, the nation's leading accounting firm for small business. Brendon has worked ...