Automate Your Manual Inventory System - An SMB Guide White Paper

A primary benefit of moving to an automated system is significantly improved accuracy. “Customers often tell us that in the course of a month they are off, say, 20 items when doing hand counts,” says Jono Manion, product manager at solution provider MGM Solutions. “Once they switch over to an automated system, these same customers might be off three items.” That means accuracy at these companies increased by 85 percent.

But what about businesses that are doing a very good job keeping their books? Even such businesses can see a significant improvement in accuracy: 20 percent minimum, suggests Manion, and often more.

In many situations, accuracy and time operate inversely: speed things up, and accuracy falls, with the reverse holding true. But with automated inventory tracking, users benefit from both better accuracy and faster times. Of course, the amount of time saved depends on the size and complexity of the inventory, but Manion says many smaller businesses save between four and 20 hours of manpower per week. For most businesses, he says, a 20% labor savings is virtually the minimum, and labor savings of up to 75% is not unheard of.

When choosing an automated inventory solution, first analyze your situation. Do you have one location, say a retail store or a warehouse, or do you have multiple locations? If you have multiple locations, the solution will need to support this. Perhaps you have one location today but think you might expand to two or more within the next few years. In this case, analyze the solution’s scalability to see if it can accommodate your expected growth.

Consider the degree of granularity you need. Is it okay to have a record that tracks the number of shirts in stock? Do you require more granularity by needing to know the number of shirts of each style? Or do you require even more granularity by needing to know not just the number of shirts of each style, but also the number of shirts of each size in each style and in each color? Knowing the degree of granularity required helps you understand the capabilities you need from the software you buy.

Now it is time to choose an experienced solution provider. This is generally not a do-it-yourself project. “An experienced value added reseller (VAR) can distill your needs to match what fits the various products available,” says Manion. “Most have been in the industry long enough to know what solutions work for various situations. And it does not hurt to ask multiple VARs for recommendations.”