What is Inventory Control? Methods, Challenges, and Best Practices

By: Michael Keenan

Introduction

As a retailer, the role of inventory in your operations cannot be overlooked.

It is the blood that flows through the veins of your business, determining your sales and profits, and even your customers’ satisfaction. However, managing inventory efficiently is not as simple as it seems. Balancing supply and demand and minimizing inventory discrepancies can be a challenging task. This is where “inventory control” comes into play.

What is Inventory Control?

What exactly is inventory control and how does it differ from inventory management?

Whether you are at the beginning of your journey or an experienced retail business owner looking for ways to improve your operations, use this article as your guide to understanding the importance of inventory control, inventory control methods, the challenges you may face, and the different types of inventory control systems.

The Importance of Inventory Control

Now that you know what inventory control is, let’s look at some of the key benefits of implementing it in your retail store.

Inventory Control Methods

There are several inventory control methods you can use, including:

• Manual data entry (pen and paper)
• Spreadsheets
• Inventory cards
• Software

Challenges to Overcome in Inventory Control

Here are some common challenges in inventory control that you may encounter:

• Overstocking and stock shortages
• Inaccurate data
• Managing suppliers
• Technology integration
• Seasonal demand fluctuations

Best Practices in Inventory Control

No matter what inventory control system you use, there are some fundamental practices you can apply to your inventory control process:

• Regularly review inventory
• Classify products
• Establish reorder points

Controlling Your Store’s Inventory

Inventory control should not be confused with inventory management. If you focus on inventory control, you are investing time in warehouse management and ensuring inventory management to maximize profits and reduce costs associated with order fulfillment, replenishment, and inventory turnover. If you implement an inventory control system that aligns with your inventory workflow, you will be on the right path to maximizing revenue.

Source: https://www.shopify.com/retail/inventory-control

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