Before modern technology, inventory management was a nightmare. Spreadsheets and sticky notes could only get you so far. It was commonplace to waste money on excess stock or lose sales due to shortages, and it would take hours to count and update items manually.
Thankfully, modern inventory software is here to rescue retailers from spreadsheet nightmares and drive inventory management into the future. It’s been around for a while, but it’s evolving at such a rapid pace that it can be hard to keep up.
Advanced inventory software provides complete control over your stock with real-time tracking, insightful analytics, automation, and more. Still, there are certain features you must have, and some that are luxuries.
In this post, we focus on the must-have features that enable you to manage inventory effectively for your unique store. We’ll also show you how an integrated point of sale (POS) system provides the foundational tools to maximize profits.
Inventory Management Software Features: The Skinny
It’s worth mentioning again that if you’re still using manual processes to manage inventory, you’re setting yourself and your team up for a rough ride. Inventory management software is now so robust you’ll wonder how you ever did it manually.
There are various benefits to using inventory management software:
- With a centralized database, you can organize and control your inventory in one place.
- Predictive analytics help forecast demand, so you can order enough of what you need and less of what you don’t.
- You can use software to automate repetitive tasks like reordering, free up your employees to sell, provide excellent customer service, and be more creative.
- You can make data-driven decisions using reports that reveal inefficiencies and opportunities, so you can sell smarter.
- You’ll improve customer service, satisfaction, and loyalty by always having what your buyers need.
A word to the wise: Don’t overwhelm yourself and your team by using every software feature available. You want usefulness without unnecessary complexity. Let’s look at the essential inventory management software features that will help optimize your operations.
What Is Inventory Management Software?
Inventory management software uses technology to give you complete control over your retail stock. It lets you track exactly what’s in stock, and its location. You’ll have details like SKU, quantity, cost, and real-time stock levels — everything you need to know in one place.
Modern inventory management software also allows you to:
- See what’s most popular versus what’s collecting dust on your shelves.
- Get real-time updates as stock is delivered, sent out, or sold.
- Integrate with tools, like your POS system, for easy reporting and visibility.
Related Read: How To Use Your Point of Sale Analytics To Increase Profits
Making data-driven decisions is the new norm in retail. With robust inventory management, automation, and AI, your store can reach new heights and drive profits.
Feature #1: Stock Control
What’s in your warehouse, and where is it located? If you want to optimize sales and supply chain operations, you need real-time visibility into your stock. Without it, you’ll run out of popular items and overstock less popular ones.
It’s crucial to have a crystal clear view of every product, where they’re located, and when they need to be replenished. Whenever a customer places an order, your system should pinpoint where that item is so you can ship it out quickly and efficiently. Then, the system updates in real time and alerts you when it’s time to restock.
When you have a barcode scanner as part of your POS hardware, you can scan any product’s barcode and bring up everything from its location and quantity in stock to its sales history. As a result, processes like receiving, picking, and inventory counts become faster, more accurate, and less prone to human error.
Feature #2: Real-Time Inventory Tracking
Real-time inventory tracking is essential to smooth operations. You don’t only know where products are in your warehouse — you know whether they’ve been sold, transferred, or received.
The most significant advantage of real-time inventory tracking is how fast your inventory is updated. As soon as you sell an item or it’s moved to another place, your system immediately reflects the change. You’re always working with up-to-date information and can make data-driven decisions.
Related Read: How To Increase Inventory Turnover: 6 Ways To Optimize Your Inventory
All of this information helps reduce stock discrepancies. You’ll know when an item needs replenishment, get alerts if stock exceeds target thresholds, pinpoint if a product is misplaced, and get notifications if an order is stuck en route. The result? You can proactively address issues before they impact customers and sales.
Feature #3: Comprehensive Reporting & Analytics
Modern, robust inventory management software can quickly analyze trends, patterns, and historical data to provide detailed reports. Analytics let you:
- See which products are flying off the shelves or falling out of favor.
- Identify which suppliers deliver consistent quality.
- Predict future inventory needs based on historical sales data and demand.
- Keep just the right amount of inventory to minimize shrinkage.
- Improve inventory ROI by tracking turnover.
- Build reports so you can analyze the KPIs you care about.
Imagine having all this information in one place, at your fingertips. Modern POS systems have reports like daily sales reports built in, and they’re easy to understand and use. With actionable insights, you can steer your business with confidence.
Feature #4: Integration With Other Business Tools
Your POS system should have robust inventory management software integrated. A well-integrated POS system streamlines operations, allowing for accurate sales tracking, real-time updates, and powerful reporting.
But your inventory management software should integrate with other parts of your business tool stack. Key integrations include:
- Accounting software, to get updates on your financial health based on sales, purchases, and stock adjustments
- Your e-commerce platform, to ensure online stock levels are updated and your customers have a consistent shopping experience
- A CRM integration, so you can offer and track personalized customer experiences based on purchase history and preferences
- A customer loyalty integration, to keep track of rewards and discounts and automatically apply them at checkout
- Supply chain management tools, to connect inventory with ordering, shipping, and warehouse processes
Integrations help eliminate blind spots, and with all your business data linked, you can optimize operations and create better customer experiences.
Feature #5: Forecasting and Demand Planning
By analyzing historical sales data and current market trends, this feature predicts future demand for your products. Start by analyzing historical sales data. How have your products performed over time? Are there seasonal trends? When you understand product performance, you can better plan for the future.
What about external and current trends? Consumer behavior changes, and popular products suddenly stop being popular. Keeping your finger on the pulse is essential to help make accurate predictions.
The combination of historical data and current market trends makes it easier to forecast future demand and helps align your inventory.
Using Your POS System To Effectively Manage Inventory
Your POS system should be the heart of your retail operations. It can bring together disjointed data and fragmented systems and create a centralized place for you to run your store. With inventory management built in, you’ll get:
- Unified data: Inventory tracking unifies data from online and in-store sales.
- Real-time updates: Inventory updates automatically as sales occur across channels and locations.
- Accurate demand visibility: Sales data provided by POS analytics provides a clear insight into product demand and sales patterns.
- Automated reordering: With automatic stock alerts, your POS system lets you know when to reorder products, and some POS systems automatically reorder for you.
- Streamlined receiving: Instantly update inventory by scanning barcodes on incoming shipments.
- Omnichannel optimization: Stock visibility across all channels reduces overselling and improves fulfillment.
- Custom reporting: Generate reports with inventory KPIs specific to your business.
And more! A POS system purpose-built for retail is an invaluable tool.
Inventory Management Software Features: The Future
In the next few years, Artificial Intelligence (AI) and Machine Learning (ML) will revolutionize inventory management, enabling more accurate forecasts, personalized experiences, and efficient operations. By embracing inventory management software, you can pull ahead of your competition.
POS Nation is at the forefront of modern retail management. We provide POS solutions for thousands of retail store owners, but what sets us apart is our dedication to supporting our customers and making it easy for their entire teams to use our system.
Do you want to discover more about the features you need and what else to look for in a POS system? Check out our Buyer’s Guide. It’s packed with valuable insights, tips, and recommendations to help you choose the best hardware and software for your business.
