A Guide to Selecting a Point of Sale (POS) and Inventory Management SystemsFebruary 22, 2022 - 11 minutes read
How to best streamline your inventory management strategy with a POS.
Without a solid inventory management system, it’s unlikely that any retail or eCommerce business will ever reach its full potential.
Improving your inventory management processes can not only boost productivity and profits but also greatly improve your customer experience.
Here, we’re going to look at the key features of POS systems while considering what to look for in point-of-sale-based tools or platforms.
But first, let’s talk about inventory management and why it’s important.
What is inventory management & why is it important?
You likely know what inventory management is in practice (you are a retail or eCommerce business owner, after all). But to ensure you keep your efforts on track, it’s important to understand the core concept of inventory management:
Inventory management is about fulfilling products, meeting expectations, and delivering on your promises with consistency. To succeed with your inventory management activities, the entire process must be fluent, and having the insight to tackle any potential stock or fulfillment issues as they emerge is essential.
The laborious, manual stock checking and management activities of yesteryear are gone. To thrive in the modern age, it’s vital to tackle your inventory management activities with a data-driven approach. That’s where POS systems come in.
Using an inventory management system will make your business more:
- Adaptable to constant changes in stock levels and consumer demand.
- Scalable by offering the insight to make smarter, more informed stock management decisions as your business grows.
- Profitable by streamlining your processes and saving money on wasted stock, fulfillment delays or issues, and uneconomical inventory management activities.
- Reputable by helping you consistently deliver on your promises, boosting customer satisfaction levels and your brand reputation in the process.
Studies show that one-third of businesses miss a shipment regularly because they sell an item that’s not actually in stock. That’s a costly mistake (both in terms of financial burden and brand reputation). But with an inventory management system in place, you will avoid such calamities.
Read: Our essential guide to inventory management tips for inspiration on how to optimize your stock-based strategy and activities.
Why is a POS inventory management system & why should I use one?
A POS inventory management system includes a mix of hardware and data-driven software that cashiers or salespeople use to process client or customer payments.
These smart, streamlined systems offer the flexibility to track and monitor sales and stock levels from anywhere in the world. With a modern POS system, you can track stock and sales data from various touchpoints, including on your website or online store, at a brick-and-mortar storefront, 3rd party sites like Amazon or eBay, at pop-up venues, at conferences—the list goes on.
The best inventory management systems integrate with existing apps or platforms to present accurate data around sales and stock levels. This enables retailers and eCommerce business owners to receive alerts when particular stock levels are running low, identify buying trends and patterns, monitor sales targets, and make accurate inventory projections from one central location.
Here’s why you should use an inventory management system for your business:
- Autonomous inventory tracking: This essential attribute drives down the time you or your staff need to commit to continually checking on stock and eliminates the necessity for inaccurate inventory hand-counting.
- Enhanced access to data and better business insights: Good systems empower employees to understand if an item is in stock or needs replenishing at a swift glance, offering a simple way to monitor inventory levels and avoid fulfillment issues.
- Intelligent reporting: The best inventory management systems offer data-driven reporting tools that allow you to view transactions by location or timeframe, offering the insight to guide your stock management or marketing decisions. If you’re running low on a certain category of stock, you will know exactly how much to reorder. And if something is slow-moving, you can run a targeted promotion to gain more sales, for instance.
- Dynamic stock management: Richer, more relevant information gives businesses the power to use inventory management techniques that reduce stock wastage, streamline resources, and maximize sales across the board. This is exactly what a POS system can do for your business.
The result? Faster growth and a greater level of customer service—two of the most essential aspects of a thriving business.
What to look for in an inventory management system
Your business goals & rate of growth
Before you commit to an inventory management system, it’s important that you consider your existing business goals and current growth rate.
Some systems come at lower price points but less features. If your business runs on a simpler model with fewer transaction points to consider and less stock to manage, this might suit your goals and budget.
If your inventory list is currently narrow (you only have three categories and 12 products to consider, for instance), and you’re looking to expand your range within the next 12 to 18 months, consider a system with features and functionality that can scale with you.
When you’re looking for an inventory management system, it’s also important to choose one that is suited to retail and eCommerce.
Customizable functions & features
Another key component of a good system is its (previously mentioned) ability to integrate with your existing tools, channels and platforms seamlessly. If a prospective inventory management system is highly integratable (or integrates with the right apps or platforms for your business), you can hit the ground running. Things you probably want to integrate with include your accounting system (i.e. Quickbooks) and 3rd party ecommerce sites like Amazon, eBay etc.
It’s also important that any potential system has customizable features or functions that empower you to tailor the data and interface to suit your specific needs. That way, you will gain far more insight and, ultimately, enjoy a greater return on investment (ROI).
Digestible insights & data
It’s no good having access to all that data if it’s hard to understand or takes a long time to wade through.
The most dynamic systems will present your stock and sales data in a way that is logical, visual, interactive, and easy to understand at a glance. In turn, this will help you make stock and sales decisions with complete confidence while ensuring everyone in the business benefits from your most valuable insights.
Product flexibility & access
Some inventory systems are fairly rigid and will only allow you to track sales or stock data in particular scenarios (in-store and via online store only, for instance). It’s important to choose a tool or platform that offers genuine flexibility.
The most effective point of sales inventory management platforms offer the ability to track real-time sales and stock data from anywhere using mobile technology while keeping tabs on transactions, even when the system goes offline momentarily.
This level of flexibility and access means that you will connect with consistently accurate data that will help you improve your stock management decisions, troubleshoot potential issues in real-time, and make strategic tweaks that ultimately accelerate the growth of the business.
“You keep customers by delivering on your promises, fulfilling your commitments and continually investing in the quality of your relationships.”—Brian Tracy
By investing in your inventory management processes, you will create a solid foundation for your business.
A POS inventory management system provides all of the tools and insight you will ever need to keep your stock flowing freely, optimize your sales activities, and keep your customers happy. Leveraging an inventory management system will boost your bottom line while strengthening your customer experience. And when you have an excellent brand reputation, great things will happen.
If you’re ready to power up your business with a POS inventory management system, we have the solution for you. Get in touch or book a demo, and we’ll be happy to get the ball rolling.