Batch-wise inventory management is important for small businesses in India as keeping track of inventory can feel overwhelming for you. There are traditional methods that help you with batch inventory management system. Which relies on general stock counts resulting in issues like stockouts, overstocking, and paying for expired stock or product.
This is where batch-wise inventory management can help simplify batch-wise inventory management for small business owners in 2024. By tracking inventory by purchase or production lots called batches, small businesses gain clarity of their stock, helping them make better business decisions and simplifying how to manage inventory batch-wise and optimise operations.
How to Manage Batch-wise Inventory for Small Business in 2024
You can easily manage batch inventory management system and simplify batch-wise inventory management for your small business owners in 2024-
Begin with labelling-
A proper and consistent labelling system for each batch-wise inventory. Add important details for batch-wise inventory with a unique batch number, manufacturing date, expiration date, quantity in your batch, and product details.
By having a batch-wise inventory management system, you are simplifying your business processes, and implementing better tracking of each stock /product /batch in your supply chain, promoting better inventory management.
Use Inventory Management Software-
Invest in affordable cloud-based inventory management software. Look for features like batch tracking, barcode scanning, and low-stock reminder, report inventory category-wise, gain real-time stock insights with batch-wise inventory, and simplify record-keeping.
Quantity based Techniques-
Follow batch inventory management system techniques to group your stock or quantity of products into batches by following inventory management techniques like FIFO, LIFO, and FEFO explained here-
-The FIFO (First-In, First-Out) method prioritizes selling the oldest items in stock first. It's ideal for goods and items with expiration dates, preventing overstocking, or products prone to fast-moving demand (like technology).
-The LIFO (Last-In, First-Out) method prioritizes current stock to be grouped in a batch-wise inventory because the most recently received items are sold first. It can be beneficial in situations that are dependent upon tax implications.
-The FEFO (First Expiry, First Out) method is based on grouping stock into selling items with the earliest expiry dates first. It's particularly well-suited for businesses that deal with highly perishable goods, such as food and beverages, or pharmaceuticals. FEFO ensures batch with the shortest shelf life is sold first, reducing waste stock and maximizing profit batch-wise.
Inventory Audit:
Batch-wise inventory management makes inventory auditing a smooth process by improving the accuracy of the inventory. When we use details to organise our inventory it helps in keeping accurate stock count.
By having batch inventory management system information easily available, auditors can spend less time checking out discrepancies.
Batch-wise inventory tracking generates detailed reports with batch numbers, quantities, and expiry dates. This provides auditors with readily available documentation to match with inventory records.
Staff Training-
Train your staff on batch tracking and its role in efficient batch inventory management system. This includes proper understanding processes (verifying the batch-wise inventory details), optimum storage practices by managing batch-wise and expiry), and sales protocols (following FIFO for optimal stock rotation).
Overall, batch-wise inventory management simplifies the audit process for small businesses. It leads to more accurate results, saves time and resources, and helps maintain clarity of your small business's batch-wise inventory health.
Benefits of Using Batch-wise Inventory for Small Businesses in 2024
Inventory Rotation-
Batch-wise inventory management allows you to track expired batches and helps you rotate inventory and maintain cash flow in your business. Batch-wise inventory management helps you capture details like quantity and expiry dates for each batch, ensuring accurate stock record maintenance from the start.
With batch-wise inventory management, you can prioritize older batches first by selling products from older batches first, which also minimizes the risk of expired products and keeps your inventory up-to-date, improving your profitability.
Efficiency & Cost Savings-
Batch-wise inventory tracking minimizes the risk of expired stock or products, leading to major cost savings. You'll experience reduced inventory shrinkage (loss of inventory) and optimize warehouse space by preventing overstocking. Efficient stock rotation with FIFO batch-wise inventory management technique (selling older batches first) also streamlines operations.
Improved Quality Control-
Whenever a quality issue arises, batch-wise inventory tracking allows for identifying the problem in a particular batch inventory management system. You can take remedial actions quickly, minimizing the impact on other products and protecting your business reputation.
Better Decision-Making-
With batch-wise inventory management, data-driven insights are important for success. Batch-wise inventory tracking provides useful information on batch-wise stock buying trends, product life cycles, and optimal stock levels. This allows you to make the right purchasing decisions, preventing overstocking and guaranteeing you have the right products in stock to meet customer demand.
Conclusion
In today's competitive landscape, efficient inventory management is critical for small businesses in India. Batch-wise inventory management offers a powerful solution, transforming the way you track and control your stock.
By implementing this method, you gain granular visibility into your inventory, enabling you to make informed purchasing choices based on real-time batch data, preventing stockouts and overstocking.
Reduced Costs, Improved quality Control, enhanced profitability, simplified audits improving the future of inventory management! Invest in batch-wise techniques and empower your small business to flourish in 2024.
Tap to know how ▶ GimBooks App can help you with batch-wise inventory management.
Frequently Asked Questions-
What is a Batch in Inventory Management?
A batch (or lot) in inventory management is a specific group of common products. Batch-wise inventory can be done in the following ways-
Production date: When the products were manufactured.
Expiration date: When the products become unusable.
Raw materials: The components used to create the products.
Manufacturing location: Where the products were produced.
By assigning a unique batch number to each group, businesses can effectively track the products throughout their lifecycle, from production to sale.
What is the Batch Code of Inventory?
The batch code is a unique identifier assigned to a specific batch of products. It helps you to differentiate one batch of inventory from another batch of inventory.
How to Choose a Batch Number?
While there's no strict rule for choosing a batch number, it's generally recommended to use a system that clearly shows the information, like-
Sequential numbering: Assigning consecutive numbers to batches.
Date-based numbering: Incorporating the production date into the batch number.
Combination: Combining sequential numbers with date or other relevant information.
The right method depends on your business's specific needs and the software you use.
Which is the Best Software for Batch-Wise Inventory Management in India?
Several software options are available for inventory management in India, catering to businesses of all sizes. Some popular choices include:
ERP (Enterprise Resource Planning) software: Comprehensive solutions like SAP, Oracle, and Tally ERP 9 offer robust inventory management features.
Cloud-based inventory management software: User-friendly options like GimBooks, Zoho Inventory, Vyapar, and myBillBook are suitable for small and medium-sized businesses.
Specialized inventory management software: Industry-specific solutions are available for sectors like retail, manufacturing, and healthcare.
Choosing the right software depends on your business's size, industry, specific requirements, and budget.
Explore more about batch wise inventory management-
Noorleen Kaur Bhatia
GimBooks