Manual vs. Computerized Inventory Management

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Each business regardless of its size needs to have an operational inventory management system. Inventory management assists in accounting, as well as tracking your merchandise count.

The choice of whether to use a manual or computerized inventory control system lies on you as the business owner. Both systems have their advantages and disadvantages.

Manual Inventory Management System

Advantages

  1. Simplicity

For small businesses with limited stock or companies that have a slow inventory turnover, the manualized system of inventory control works well for it.

You will be able to track all your sales and stock manually without undergoing any unnecessary stress. This is also known as the eyeball test.

All you have to do is crunch a few numbers to determine whether you need to request for more stock. You, therefore, do not need to spend money acquiring inventory software or even taking time to learn how to operate the software.

  1. It Provides Business Owners with a Sense of Control

Manual systems provide the small business owner with a better sense of control. You will not need to rely on the instructions provided by the computer indicating that you need to order new merchandise. You can handle all these processes on your own.

Additionally, getting to view your merchandise before making a purchase will make it possible for you to assess the condition of all your merchandise. You get to ensure that your clients will not receive goods that have been damaged.

Disadvantages of the Manual Inventory Control

  1. The System is Labor Intensive

Manual inventory control systems are labor intensive regarding their operations. Regular monitoring will be required to make sure that all transactions have been accounted for.

You also need to regularly check to confirm that all products on sale are at the appropriate stock levels. It also becomes challenging to share information across your business, as the process of accessing your inventory records tends to be more cumbersome.

You could use the time you are spending accessing the stock levels performing more productive roles in the business.

  1. Increased Chances of Human Error

Manual inventory systems are heavily reliant on personnel actions. This, therefore, increases the risk of human error taking place.

Your employees may forget to record certain transactions. They could also miscount the total number of products that are remaining.

A miscount could lead to unnecessary costs occasioned by an increase in the stock inventory.

Computerized Inventory Control Systems

The success of any business operation lies in the management’s ability to track and monitor the stock levels efficiently.

Your business can increase its bottom line when you have access to up-to-date data on office supplies that are required, products available for sale, and the raw materials needed for continued manufacturing.

Your enterprise will be better positioned to address any changes that may occur in your supply chain when you have a computerized system in place.

Advantages

  1. Consistency

Businesses operate more efficiently when their processes get executed in a manner that is consistent. Computerized inventory control ensures that all reports are uniform.

Whether you are looking at orders or business related documents, they will all have a certain type of uniformity, regardless of when they were created. It is a factor that makes it easier to read the documents.

  1. Accuracy

It is perhaps the most significant benefits associated with computerized inventory control. Human error is common in any business setting.

Manual inventory management means that error margins are likely to widen with every update made to the list.

A typo or simple miscalculation can lead to a severe problem. This is something that is less likely to occur with electronic software.