The Perils Of Inventory Mismanagement

The Perils of Inventory Mismanagement

by

Kelly Church

One of the biggest things in the business industry that brings down a small business is lack of inventory control. This may seem surprising as there are many things that can bring down a business, and inventory management isnt usually the first thing that is thought of. While keeping track of inventory may seem less significant than other parts of running a business, it is key to making your business run properly and to managing the money you have invested in the business. Several problems with supply management include ordering mishaps, employee theft, and not keeping records. These can all sabotage your business with quickness.

One of the biggest ways to lose money in business is by commonly occurring ordering mishaps. For example, if you order too little of a product and run out quickly, when someone comes in to purchase the item, it can lead to frustration that can give the wrong impression. Remaining well-stocked is a very important thing to do. At the same time that you do not want to run out of anything frustrating your customer, you do not want to overstock either. Dealing with overstock once can be very pricey. Thinking that you are going to sell much more than you realistically do can make things tough on the budget of a small business, especially one that has just started. Dealing with overstock often can financially break a business. Another thing that can make a huge dent in the pocket book of any business is employee theft. Doing the best possible to hire employees that are honest and trustworthy is a good way to cut down on this. However, no matter what you do to cut down on employee theft, it may be difficult to eliminate it completely. Ways to prevent this from happening include security systems, which for an inexpensive price these days can be purchased and easily installed. Also, preventing employee theft can be made easier by making each employee accountable to initialing and signing out things that must be removed from the stock room. This way, they will be less careless and will have less of an opportunity to remove merchandise without it being detected. Another way to cut down on employee theft is to purchase or develop and use an efficient inventory management system. This is also a thing that brings businesses down in finances. Losing track of things, not recording incoming or outgoing supplies, and not ordering in a timely manner can all make a difference in both money and the smoothness of your operation. Getting software for your business computers and training your employees to utilize it properly can save you time, hassle, and most importantly, money. There are many software programs that can help you manage your money and stock very well. All of these problems with inventory management are very common in the demise of businesses, but they do not have to be. If you can stop these problems as soon as or before they start, you can help your business become successful and thrive. There are so many ways a small business owner is fighting up hill just to stay in the black. Something as simple to solve as inventory control should not be one of the things you as a business owner have to fight.

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The Perils of Inventory Mismanagement