Smart Inventory Planning & Optimization : No. 1 In Inventory Management Software

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How things go topsy-turvy if right things don’t happen at the right time?

In any organization, operations are liable to become chaotic if the right decisions are not taken at the right time. Ideally, we expect things to happen by clockwork precision, but unfortunately, that is not always the case and one has to deal with unexpected contingencies. Sometimes blunders in communication occur which prove to be very costly to an organization – it could lead to a loss of precious customers which directly impacts the bottom line profits. Inaccurate business choices could also lead to a lack of internal coordination between the various departments of a firm.

Let us assume that the production and finance department are not working in tandem – it would lead to a state of disorder and confusion with under-stocking or overstocking. Warehousing is another critical area that has to be handled cautiously. The absence of adequate warehouses may lead to a critical deficit in stock levels which would, in turn, lead to the loss of loyal clientele.

So how do we make things go right all the time?

• Tackle the flow of multiple activities in the organization!

It’s absolutely essential for managers to tackle the multiple activities in an organization simultaneously. Human resource has to be capitalized to its maximum potential and the person-job match should be perfect. There should be clear channels of communication between superiors and subordinates, and reporting should be systematic, organized and consistent.

Authority to get work done should be delegated to the most suitable person and accountability should be maintained. Technology is another driver which should be harnessed to the maximum to leverage a business to a higher platform.

Today the market is flooded with numerous software which can help an organization manage vital functions such as recruitment, customer relationship management, training, asset management, finances, accounting, billing, and stocking. This software can indeed prove to be a huge asset by enhancing the efficiency and accuracy of business decisions.

• Evaluation of Stocks

One of the most crucial aspects to ensure the smooth functioning of business processes is the management and control of stock and inventory. We know that adequate stock is the lifeblood of any organization and a shortage in stock may even result in a halt in business operations.

Evaluation of stock basically entails utilizing scientific methods to determine how much stock is required to meet production demands. Inventory accounting includes the recording of stock details like the purchase of stock, sale of stock, stock movement between storage warehouses and providing information on stock availability.

• Methods to Manage Stocks

Evaluation of stock basically entails utilizing scientific methods to determine how much stock is required to meet production demands. Inventory accounting includes the recording of stock details like the purchase of stock, sale of stock, stock movement between storage warehouses and providing information on stock availability. Effective stock evaluation ensures that the right amount of material is available at the right place and time.

Managers use many methods to determine required stock quantity- they often use the process of demand forecasting to predict future requirements. Many managers also use the inventory turnover ratio (ITR) to predict stock requirements. The ITR measures the number of times your business “turns over” its inventory in a year.

Previously companies used to depend on manual labor to count and manage their inventory – a process that was tedious, time- consuming and prone to human error. Nowadays with the advent of automation, many firms use software to evaluate their stock levels and replenish them. Using technology to assess stock level is a cheaper, faster and more accurate than the prior labor-intensive methods.

The mammoth task of inventory evaluation is pivotal to the uninterrupted and smooth functioning of any manufacturing firm. It is important that delegation of duties should be undertaken to ensure that every person performs the correct action to manage stock. Effective delegation leads to different parties performing tasks that they are well-versed with and spreads the workload evenly throughout the organization.

Technology has also advanced rapidly and it is now a major resource that can help us manage inventory accounting. A number of advanced features in modern software’s can easily help firms classify inventory items, separate stock purchases, calculate replenishment levels and place orders.

One of the most diverse multi-faceted software that aids in inventory control management is Tally ERP. It is multi-pronged software that it handles almost every aspect that a business requires. It handles a variety of functions right from setting up a business to accounting management to billing to payroll to investment decisions, everything is covered by Tally!

Tally ERP! A Smarter Choice

Tally ERP software has a number of novel user-friendly features which make it a convenient tool to manage stock. One such innovative feature is the stock aging report. The Stock Ageing report in Tally ERP 9 displays the age of the stock in hand. This report lists the age-wise break-up of Inventory to point out old stock based on the user-defined slabs.

Stock Ageing analysis enables you to know the age of stocks in hand according to when they were received and their purchase value. This feature is also very useful in letting you know how fast the inventory of various stock items is moving. The analysis of stock aging allows the management to take correct business decisions regarding the production plan and schedule.

Tally is one of the most economical and popular software on the market today. In Tally ERP, different types of reports can be generated at the push of a button. Detailed analysis of data helps in undertaking more accurate business choices which improve profitability. In order to improve business investments, all the principal ratios including return on investment, return on working capital, current ratio, quick ratio and debt/equity ratio can be automatically generated. The ratios can also be altered for a certain time period to make active business decisions.

Whether a new startup or a huge corporation, Tally is the best enterprise resource management system and it can completely revolutionize the course of a company’s trajectory.

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