Inventory tracking is an ongoing, fluctuating process that must be tightly managed to fulfill every customer order.
If you sell goods to customers in multiple channels, such as online, in physical stores or through sales representatives in the field, real-time inventory tracking is not just needed, it’s necessary in today’s fast-moving, data-based economy.
In fact, using real-time inventory tracking is a proven advantage in today's highly competitive world of digital commerce, especially if your competitors aren’t using it. Although companies struggle to find the budget to implement the technology to manage eCommerce inventory, “42% of customers want insight into inventory and delivery times.”
In addition to using real-time inventory management software to improve the customer experience, it’s simply expected by the average customer today. If you don’t have what they need when they need it, they’ll take their business elsewhere. It’s imperative that you do everything you can to maintain the right stock levels for the right products.
As an example of how quickly things can go awry, consider this: Your field sales representative secures a large order for one of your most popular items and depletes your entire inventory in one transaction. Before your representative has a chance to update your Excel spreadsheet, two more orders came in for the same item.
Now you’ve committed that inventory to three different parties, yet you can only please one or two—your very large customer or the other two customers. One or more parties will need to wait until you get new stock in. You’ve also got to follow up with them to let them know there will be a wait. Furthermore, if you get any additional orders before your new stock arrives, you’ll have to turn those customers away as well.
At the end of the day, a fulfilled order is a happy customer. What are the other negative effects of tracking inventory in Excel? Let’s review them.
Why Tracking Inventory in Excel Will Fail You
1. Fulfillment Risk
Although we’ve already mentioned it, it cannot be stressed enough that by tracking inventory in Excel, you raise the risk significantly of not being able to fulfill customer orders. Do this once and you might forever lose that customer. Real-time inventory tracking via a cloud-based eCommerce platform will enable you to avoid such scenarios.
2. Human Error
By allowing multiple people to manually update your Excel inventory spreadsheet, the chance for human error significantly increases. If someone mistakenly neglects to deduct inventory sold, you may think you’re able to fulfill an order in another sales channel. Now you’ve billed the customer and you have to backtrack by calling them to let them know your mistake. Sadly, you might lose that customer for good.
3. Difficult Troubleshooting
By tracking inventory in an Excel Spreadsheet that is emailed to relevant team members, it’s difficult to track who made an error, if one occurs. You’re going to spend time chasing down who made the error, so they can correct it and it may affect other orders. This could be a rabbit hole that you spend hours or days trying to climb out of to correct.
4. Simultaneous Users
Multiple teams might need your static spreadsheet at the same time. In fact, if three different sales channels need to update the spreadsheet at the same time, those individuals might neglect to manually update it once they do get access to it. Employees are likely tracking all their orders on their own and updating the spreadsheet with multiple orders at one time. If they neglect to include one order, that sets off a chain reaction of errors and trouble fulfilling multiple orders.
Use Inventory Management Software Instead of Excel
Instead of using Excel to track your inventory, you can use cloud-based software that helps you keep inventory up-to-date at all times. Such software should update inventory in real-time across all channels of business, leaving no customer disappointed.
In addition to providing immediate customer benefit, the software used to help you track inventory can also help you better plan for the future. By using past data to predict future sales, you’ll have the insight needed to resource appropriately. Such planning can also help you improve your inventory turns ratio, which also improves profitability.
Finally, by using cloud-based software to track inventory, you also inherently gather other data that can help you track KPIs relevant to your industry and gather business intelligence, both of which are helpful to growing and planning how you make adjustments to your overall business strategy.
Looking for a cloud-based software to use instead of tracking inventory in Excel? Systum is the industry’s first enterprise-grade, affordable business platform that helps you run your wholesale, distribution or digital commerce business. Switch to Systum and optimize your operations, unify data and better serve every customer from one dashboard. Fill out the form below to have a representative contact you.