Revamp Your Business with These Essential Features of an Inventory Management System

Must-Have Inventory Management Software Features, Requirements & Modules

In this article, you'll learn what features to prioritize when searching for inventory management software solutions. Also covered here: the latest developments within these systems as well as how to determine your individual needs with a quick-reference checklist.

What is an Inventory Management System (IMS)?

An inventory management system helps companies keep an accurate record of incoming and outgoing stock, helping to serve customers more efficiently while avoiding either overstocking or loss due to stock shortages. An MIS impacts virtually every aspect of business, such as accounting, production management, warehouse management system, and purchasing - it has even an influence over accounting!

Are There Main Features of an Inventory Management Systems?

Inventory management systems should include key features that facilitate storage, organization, management, and analysis of inventory data. In terms of system requirements:

• An intuitive interface that does not necessitate training, documentation, or customer support services.
• Cloud-based solutions
• Automating business functions related to inventory count management to eradicate manual processes is becoming an essential way for organizations to operate efficiently.
• Database that offers secure, accurate data in real-time.
• Performance that facilitates quick and actionable inventory control is required for effective operations management.
• Importantly, administrators need the flexibility and ease of adding new software modules with minimum configuration efforts.
• Automated features and software integrations that decrease manual input or updates for inventory are becoming more prevalent today.

Top Inventory Management Systems Features by Category

Inventory management systems include key features that can help you manage, track, and plan your inventory. What to expect:

Inventory Control: Inventory Control refers to managing products already present in a warehouse process and plays an essential part in supply-chain management. Inventory Control tools enable users to categorize items by type, location, and SKU while producing real-time visibility reports and searching products with filters for real-time updates on inventory item statuses and filters if available. See our "Guide to Inventory Management" for further insights and expert advice in managing inventories effectively.

Inventory Control: Inventory control features are used to oversee information from different parts of an inventory system, like excess inventory control. Inventory Management, on the other hand, oversees business processes prior to stock arriving in warehouses or reaching its destinations - this may involve tools for multilocation inventory control as well as integrations with enterprise resources planning platforms (for instance, creating paperless purchase orders and invoices). Read up more on what separates real-time inventory management from inventory control!

Inventory Control: To effectively implement inventory control, one must track the status and location of materials and products throughout their supply chains. With perpetual inventory tracking's features assisting in automating tasks like automatically creating tracking numbers when receiving or creating invoices, tracking integration with 3PL providers as well as email systems allows businesses to better manage customer relationship management by communicating what stock they currently possess and shipping times with customers.

Inventory Barcoding: Barcoding helps automate business processes that involve inter-system interactions. Inventory operations become faster and more accurate by collecting, storing, and organizing digital inventory data quickly. Barcode software integrates seamlessly into digital reporting/documentation features (such as touchscreen signature capture or paperless invoices). Mobile barcode scanners improve inventory accuracy while speeding back-office processes faster; additionally, they enable paperless documentation processes.

Inventory Planning: Take inventory optimization one step further with inventory optimizing. Even basic plans can become more sophisticated by replacing standard ordering formulas with tools offering automated reports and inventory trends as well as visibility of changes throughout your supply chain. With this data at hand, optimizing your inventory becomes possible while simultaneously meeting supply and demand. For more details, please see the inventory forecasting guide.

Inventory Alerts: A variety of modules utilize inventory alerts to reduce waste, optimize the financials of inventory, and meet customer satisfaction. These automated SMS or email messages inform users about low stock levels, delayed shipments or supply chains as a whole, giving an added level of control in sales forecasting, logistics planning (shipping logistics management, etc), or materials planning processes.

Inventory Management Features to Consider

Advances in computing, databases, applications, and IT operations created modern inventory management systems. Web services, application development, and APIs have enabled integrations of third-party applications that were previously not possible. Inventory management systems are able to manage many essential business functions.

You can customize the features of a modern inventory management system to meet your specific business requirements needs.

Cloud Infrastructure: Software on the cloud offers organizations an economical, scalable solution. Cloud computing allows organizations to refrain from hiring dedicated staff to manage and maintain these systems while offering automated backups, secured access, and real-time collaborative working across multiple locations.

Internet of Things Integrations: IoT movement has brought forth automated inventory control and reporting, GPS tracking, Bluetooth- and RFID-enabled tracking, as well as digital labels - as well as enhanced protection against theft or loss. This technology also serves to protect employees in case theft takes place at work.

Digital Labeling: As organizations move toward digital labels, new features have emerged, such as GPS-enabled tags and barcoding technology. Organizations using this approach to manage inventory information can connect handheld devices directly with databases for real-time tracking and paperless documentation of assets.

Mobile Systems: Wireless devices running mobile applications that communicate with central databases and back office systems to streamline multilocation inventory processing can communicate wirelessly with iOS or Android smartphones to allow real-time tracking, alerts, and notifications of inventory at each location.

Machine Learning & AI: AI-powered virtual agents (or chatbots) revolutionize how businesses communicate inventory availability to their e-commerce clients. Machine learning algorithms and web services automate backorder fulfillment, communicate out-of-stock inventory status to shoppers, or make recommendations based on an active shopping basket or user history. Furthermore, this technology reports trends in sales real-time data essential for optimizing metrics of online customer service as well as improving inventory control to avoid shortages. At the same time, real-time analysis provides better forecasting that allows it to monitor inventory trends that would otherwise remain hidden to humans alone.

What Are The Top Software Modules In Inventory Management Systems?

Inventory management software varies in price and provider. Start with the basic inventory modules (order management, administration tools, and other administrative tools) before building systems that integrate advanced features and integrations.

Inventory control and management modules are most commonly used to:

E-commerce Modules: E-commerce modules can help online sellers make sales.

Accounting Modules: These accounting modules automate financial activities such as accounts payable/receivable, procurement, third-party payment, and categorization of revenues.

Data Administration Modules: These admin-like modules offer quick and straightforward tools for efficiently administering inventory system data. From adding users via password authentication and updating inventory records as they become obsolete to exporting all that valuable info back out again for further review, these admin modules make managing inventory system data simpler than ever!

Warehouse Modules: The Warehouse module provides real-time inventory management functions such as appointment scheduling, order receipt, returns handling, and labeling.

Order Management Modules: These modules enable buyers and manufacturers to fulfill purchase orders and parts requests efficiently.

Key Inventory Management System Features by Industry

Software features in inventory management systems are designed to target specific markets, customers, and product types. This section contains examples of top features for inventory management systems based on the industry.

Manufacturers: These systems combine material-based inventory management and warehouse management software. These features include advanced unit conversion capabilities for handling bulk material stocks, lean manufacturing methods, material requirement planning, and bill of materials invoicing.

The following are the top features of an inventory management system for manufacturing:

Convert Inventory Quantities into Higher or Lower Units of Measure: Convert inventory quantities received into higher units of measure.

Automated ordering: Set stock limits and place an automated order when inventory falls below specified quantities.

Planning Raw Materials: Keep track of direct or indirect materials by tracking purchasing and production cycles, creating a Bill of Materials, and calculating Return on Investment for every raw material purchased or imported into production.

Purchase Order Management: Assign suppliers, track product lead times, and manage the lifecycles of purchase orders.

Serialized Inventory: Diving deeper than SKUs into individual items will allow for tracking product lifecycles, defective stock identification, and warranty data tracking.

Wholesale Distribution

Inventory management tools are essential for wholesalers who have online distribution channels. They need to be able to manage and track bulk inventory, multiple suppliers, and customers, as well as automate processes.

Wholesale distributors should look for:

Order Fulfilment: Make use of one central dashboard for viewing sales orders, creating packing slips, and sending automated email confirmations directly to clients.

Fulfillment Of Orders Across Multiple Warehouses: Keep track and fulfill orders when inventory is spread across different warehouses.

Kitting Transform items that would normally be tracked separately into an all-inclusive subscription box sales order.

Please keep track of multiple amounts of perishable items with traceable lot numbers by their expiration dates.

Bin Management: Bin Management allows inventory to be received by warehouse staff and quickly stored in bins that fit within its rack system for later picking as part of order fulfillment.

Retail

Inventory management features are vital in optimizing an in-store customer experience for retailers, requiring solutions that improve tracking inventory levels, forecasting demand and alerts as well as multichannel operations (buy online/collect in-store) with accurate multi-location features (buy online/collect in-store) for accurate multichannel operations and multiplication operations (such as buy online/collect in-store). In contrast, integrated accounting/POS features ensure profitable brick-and-mortar retail operations - for tips and best practices, see our guide to retail inventory management.

Retailers should prioritize:

• Partial Receiving: Track partially received inventory by using partial receiving control and tracking partial receiving control systems.
• Backorder Control: Generate new purchase orders by consolidating sales orders of each supplier into one, tracking products according to type, estimated arrival date, or season.
• Demand Forecasting: Set desired stock levels according to seasonal demands—Automate multilocation replenishment with one click. Generate reports with predictions on emerging trends.
• Cycle Counting: To do it efficiently and with accuracy. Set automatic prompts to count inventory to establish safety stock levels. Learn more by reading our cycle counting guide!

E-commerce

Inventory systems for e-commerce must support accurate inventory control and automated processes to deliver products to customers with no interruption. E-commerce features include accounting integrations, which incorporate online payment processing, email invoices, and inventory tracking.

The following are the top features of an inventory management system for e-commerce:

• Returns Management: Send email updates to customers, assign warehouses to receive returned items, and generate reports about return trends.
• Automate Stock: Restocking by generating automatic purchase orders. Create automated purchase orders if inventory drops below your preset threshold level.
• Multiple Carrier Shipping: Store contact and data about preferred shipping carriers while managing multiple logistics providers.
• Virtual Inventory Control: Utilizing supplier inventory stored elsewhere, virtual inventory is created, and drop ship logistics are managed using its availability.
• Display Stock Availability Accurately: Accurately reflect stock availability within online commerce platforms.

What Features Should I Select in an Inventory Management System?

It is crucial that you clearly outline your needs and pose pertinent inquiries prior to choosing an inventory system software. Before reviewing features, ask these key questions:

Are you upgrading your inventory management system? Are you in need of upgrading your inventory management system? Have you determined it is time to upgrade your system? Are you in need of upgrading to an improved inventory management solution? Consider whether standalone inventory apps could integrate using web services or APIs into existing systems; inquire with vendors regarding third-party integration solutions before investing in costly accounting platforms that require training and implementation from multiple business units.

Who Will Implement the New Inventory System Features?

As with any software upgrade, it's crucial to consider how the changes will have an effect. Consider installation and staff training on new features; consult potential providers about outside vendor support contracts; as well as training staff. Be prepared for change management if removing manual inventory tasks, as popular inventory features automate business processes and tasks, and you should appoint someone as your change manager to assist in this endeavor.

Who Will Implement the New Inventory System Features?

Be certain to inquire into all hidden expenses when making comparisons among systems; among the topics to cover are hidden charges such as:

• How many orders can be processed within an average billing cycle?
• How many SKUs can you manage successfully?
• Are you in search of additional hardware to enhance your inventory management system?
• Are your applications and data slated for on-premise hosting or cloud storage?
• How much would it cost annually to license a certain number of users?
• Does future software upgrades or maintenance incur costs?
• What services and shipping costs are covered under initial and continuing training agreements, in addition to any extra charges?

Related:- 5 Promising Warehouse Inventory Management Tips for your business

Arionerp Offers Cloud-based, Feature-rich Software for Inventory Management and Control

An effective inventory management system automates processes and improves practices while making customers happier by keeping the products they desire in stock at all times. Decision-makers face many choices for inventory control solutions; selecting one may take time, research, and smart questions - with Arionerp offering tools and answers to help with this decision-making process - multi-location control management, warehouse management software with automatic stock replenishment features as well as cycle counting features to reduce handling labor costs while increasing cash flow are just some features offered here. Learn how you can effectively utilize Arionerp inventory control features while cutting handling additional costs and increasing cash flow through reduced handling upfront costs as well.

What Stage Are You at in Your Inventory Management Software Purchasing Journey?

Let's begin our inventory software purchasing journey by making some assumptions about you and your requirements.

• Your accounting system's inventory management feature may no longer meet your business size needs as most organizations quickly outgrow its limited functionality. Most eCommerce packages now include inbuilt inventory management tools.
• Spreadsheet inventory management can be an ordeal, which you are all too aware of.
• The obvious reality of inventory management software is its limited functionality; free solutions cannot meet expectations.

Let's take a look at some of the features you will need in order to manage your inventory.

The Most Important Inventory Management Software Features

The core features that finance directors and business owners will look for are listed below. Look elsewhere if you are considering an inventory system software that does not have these features.

• Real-time Inventory Tracking: 

The number one requirement for an inventory management system is to be able to show you exactly what you have and where. Your software should show you what you have and where you've got it. It must also reflect any stock allocations or movements in real time. This means:

• Your sales orders provide an accurate snapshot of your stock status; this ensures you do not sell identical items multiple times or stock that cannot be fulfilled.
• As soon as goods have been scanned in your warehouse, they'll appear on your inventory management system.
• Real-time warehouse transfers: Make an impactful statement instantly by appearing live.
• Reserve components for production: As a manufacturer, you want to avoid starting another production run and realize half your components have already been utilized on another project. To be safe, be sure to reserve components ahead of time for use during any new runs or production runs.
• Your system allows for consignment stock to be tracked even if it is held at another store.

• Real-time Inventory Value

Finance needs to know the value of the stock. Warehouse operation managers and operations are concerned about their inventory and its location.

A good inventory management system must update in real-time, regardless of the accounting software that you use. You'll need:

• Accurate inventory values that account for variations in price or volume.
• Check your inventory value per warehouse performance and region.
• Multicurrency support: If you plan to conduct transactions across several nations.
• Tracking variable inventory costs such as courier expenses or production waste is possible with great precision.
• Group products to gain a more comprehensive view of Goods Sold.
• Your product's profit margin will be displayed live, taking into account location and sales channel.

• Reorder Points and Low Stock Alerts

Inventory management software should include alerting features that notify users when stock levels have become depleted, in turn allowing them to create purchase orders quickly in response to these alerts.

Create a reorder report for stock management to complete purchases more efficiently and on one sheet of paper. This way, you'll know everything needs to be reordered so your purchases can be completed simultaneously.

• Purchase Management & Supplier Administration

Inventory management software offers many benefits beyond inventory storage management alone, including helping you gain greater control of purchases and purchases by suppliers. Keeping track of what you own, its value, location, and how many there are puts you in a more informed position to purchase more.

Manually entering inventory information must not become time-wasting or costly errors during your buying process.

Inventory control software offers the ideal way of:

• Create and automatically fill your purchase orders.
• Store all your Supplier details centrally.
• You can dynamically generate any volume discounts that your suppliers offer you to ensure optimal purchasing.
• You can view your history for each supplier.
• Partial receipt of a purchase order if goods arrive in small amounts.

• Unlimited SKUs

It is wise to avoid software that limits how many products or items can be added; transaction, customer demand, and supplier limits all work the same in order to prepare for growth and anticipate tomorrow's needs, as well as today's investment in inventory management software, would be worthwhile.

• Accurate Inventory Reporting

There needs to be more point in investing in expensive inventory management software when data extraction must still be performed manually every month; the software's aim should be to streamline business operations more effectively while decreasing administrative burden.

Reporting tools offer data such as:

• Inventory turnover rate
• Average days to sell for each SKU
• Stock age
• Unit sales
• Margins
• More...

Inventory management for manufacturers Inventory management involves categorizing items under separate SKUs and changing their value; such an approach would likely cause tension within your tool room team. However, it shows why using an inventory management software tool as part of managing manufacturing process components makes perfect sense.

Manufacturers: Here Are Some Features of Inventory Management Software You Should Keep an Eye Out for

• Assemblies

Assembling assemblies is a straightforward internal stock movement with value shifting, from building parts for assembly into finished products with their SKU numbers.

• Bills of Material Bills of Materials,

BoMs are recipes that specify exactly which components make up an assembled product. With inventory software offering BoM management capabilities, ordering these necessary parts becomes much simpler for planned production runs.

Inventory management software should autofill purchase orders based on what stock you have on hand to fill them, nest multiple levels of BoMs for complex assembled goods, and record production waste value.

• Batch Tracking (Also Known as Lot Tracking)

Batch tracking is an integral component of inventory management systems used by food manufacturers, helping keep an eye on expiry dates and use up products before their value deteriorates. Furthermore, robust traceability systems help companies respond appropriately in case of product recalls.

• Tracking Serial Numbers

Tracking serial numbers works similarly to batch tracking, except that each component has an identifiable serial number. If your company relies heavily on expensive, highly specific components to manage, serial number tracking becomes even more essential. Furthermore, after-sales service should play an integral part in your operations; new toner can easily be purchased based on each printer model/make combination using serial number tracking.

Warehouse Inventory Management Software: the Best Features

Your warehouse manager likely will have input when selecting inventory management software; here are features they consider essential for optimal use in warehouse space environments.

Barcode scanning is the go-to way of tracking goods electronically within warehouses. Barcode readers are used for:

• Receiving purchase orders.
• Stock counts
• Sales shipments.

Ensure that your inventory management system supports 1D barcode readers and can create barcodes to print labels.

• Pick, Pack, and Dispatch

This feature is essential for warehouse management solutions. You'll need to be able to control the software and make it flexible. What to look for:

• Flexible Pick Lists for optimizing your route through the warehouse.
• The ability to complete partial shipments.
• If you are shipping overseas, support for International Commerce Codes is available.

• Stocktaking Support

Any inventory management system worth investing in must come equipped with features designed specifically to support stocktaking.

All businesses must manually verify stock figures; your inventory management software should make this a seamless and painless process.

Consider features to minimize disruption, like running inventory by a warehouse tracking system, bin, or product group. Stock adjustments will also help correct discrepancies, while variance reports provide insight into what has been discovered.

Unbeknown to many people, inventory management software contains numerous features. A good inventory management program should cover your needs while offering features that take your business to another level - features you might have yet to consider but which could benefit it nonetheless.

• 14 Optimizes Min-Max Strategy

Supply chain managers learned a hard lesson during COVID-19: it takes too much time and capital invested into stocks to monitor minimum stock levels regularly relative to lead times. Optimizing min-max strategies for the supply chain.

Companies providing inventory software have responded by developing features like advanced stock managers that use historical demand and lead time information to identify optimal inventory levels even under highly variable conditions automatically. It can be transformative for supply chain personnel who traditionally must source their information off-platform before conducting time-consuming meetings to calculate and make calculations or decisions manually.

• Stock Forecasting

Also referred to as demand forecasting, inventory forecasting is an advanced feature used by professionals and allows users to project future sales, create an interactive model showing stock movements in response to different orders placed, and plan replenishment strategies accordingly.

Supply chain managers can develop effective purchasing and stocking strategies by manipulating variables and forecasting the potential outcomes.

• Mobile Sales Apps

Shop staff love mobile sales apps because they enable them to answer questions regarding stock levels without switching terminals multiple times. Furthermore, sales staff who travel often can use them for placing large sales orders with full visibility of lead times and their capacity to fulfill them.

• Support of Multiple Sales Channels

Businesses have learned through experience that having multiple channels for sales to withstand disruptions is vitally important to maintaining sales volume, which inventory management software facilitates.

B2C sales can be integrated seamlessly with eCommerce platforms such as Amazon and Shopify, making the transition seamless for customers.

Integrating Point-of-Sale Applications.

Your sales order management system allows your orders to flow seamlessly from each of your sales channels directly into inventory management or purchases as required, all the while maintaining margin transparency across each of them.

• Modern Data Security Solutions

Depending upon where and what kind of business you run, data security requirements may differ based on law. Of course, best practices dictate it regardless - ask your software provider about encryption standards they employ as well as whether or not they support two-factor authentication.

• Compatible With Other Apps

No company should invest in inventory system software that cannot communicate with their CRM if their company relies heavily on Salesforce; the same goes for any software affecting stock levels directly, such as Amazon sales data transfer apps, which force you to enter data for years at a time manually.

Integration should ideally occur via API; an actively managed integration would make your life much simpler by simply plugging and playing.

• Advanced Analytics

With all the advanced inventory management tools at your disposal, data will certainly pile up quickly. Bonus points may be awarded if your inventory management software includes an inbuilt business intelligence interface for analysis purposes.

• Your Advisor Approves

It is wise to seek their input when choosing software systems if working with a business advisor; getting their approval would make the software that much more useful! Providing them access will only aid the decision process further.

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Conclusion

Before adding any features to your inventory control checklist, be sure you understand their purpose and benefits to your business. Any technology should also be easy for employees to use; choose technology that integrates well with other business processes (for instance, point-of-sale systems). This way, you'll be able to monitor sales across channels quickly in real-time.