The Ultimate Guide to Inventory Management: Everything You Need to Know
Managing your inventory is just as vital as impressing your customers when it comes to running a successful field service company. In fact, as more business leaders realise the importance of keeping on top of their stock, equipment and assets, it’s caused demand for inventory management software to double over the last five years.
Harnessing the power of modern technology is one of the best ways to manage your inventory effectively. Long gone are the days when you would need to rely on error-prone sign in and sign out sheets or slow legacy systems to get the job done. Not only can you eliminate the inefficiencies caused by outdated inventory management methods, but you can also enhance the services you’re able to provide and boost your bottom line simultaneously.
We’ve put together this handy guide to inventory management, which will tell you everything you need to know, including how you can improve your current processes by selecting the right platform. Read on to learn more.
What is Inventory Management?
Put simply, inventory management involves keeping track of parts, equipment and any other assets (such as vehicles). Since field service companies have so many items to manage across a range of locations, it’s essential to have complete visibility over your entire inventory so you can make better business decisions.
Unfortunately, an astonishing 43% of small businesses fail to track their inventory effectively, which loses them a significant amount of money each year.
To put the issue into perspective, picture a company that’s using paper-based sign in and sign out sheets to manage stock levels. There’s a very good chance their engineers will forget to fill them out every time. Worse still, the engineers’ handwriting may be completely illegible, leaving their back-office team unable to decipher what they’ve written. Or, maybe, their engineers simply take too many items and store them in their van for a different project instead of putting them back.
In situations like the above, the numbers would quickly stop adding up. Although slight inconsistencies in stock levels may not seem that damaging, they can harm your organisation in the long run. For example:
1. Profit Losses
When engineers inadvertently take more items than they need, it will cause your stock levels to appear lower than they really are. Inconsistent inventory quantities and an inability to track what happened to each item will lead you to order more stock or replacement tools than you need, which eats into your profits.
2. Project Delays
On the opposite end of the spectrum, human error may lead you to believe that you have plenty of tools and equipment for your customers’ appointments when you don’t. As a result, you’ll have to put work on hold, which is inconvenient for your customers, and causes scheduling and financial issues on your end. In a worst-case scenario, dissatisfied customers could take their business elsewhere.
3. Lower First-Time Fix Rates
For field service businesses, having a high first-time fix rate is essential. Companies that achieve a first-time fix rate of over 70% enjoy an 86% customer retention rate, so you must ensure that your engineers always have the right tools and equipment to complete the job during the first appointment. However, as we covered in the previous point, inconsistent inventory levels could cause you to be unprepared for scheduled work.
6th February 2022 - The Best Ways to Manage Your Inventory Using Technology
The good news is, field service management platforms are designed to help you run every aspect of your business — from accepting appointments to inventory management and invoicing. So, using modern technology to handle your stock, equipment, and assets can improve your efficiency and profits. Here are just some of the ways you can benefit from digitising your inventory:
1. Assign Tools, Equipment and Stock Directly to Jobs
According to data from Aberdeen Strategy & Research, 29% of failed first-time fixes are caused by parts being unavailable, making it the most common obstacle. Fortunately, when you use a field service management platform to handle your inventory, you’ll have complete visibility over what stock you have, wherever it is.
Using the accurate data — which updates in real-time — you can allocate tools, equipment, parts and vehicles directly to customers’ appointments based on their unique requirements. As such, your engineers won’t have to worry about whether they have the right gear and, instead, they can focus on doing what they do best. Therefore, not only will your engineers be able to visit more customers per day, but you’ll find that your customer satisfaction and retention levels will rise.
2. Add Barcodes, Serial Numbers or QR Codes to Each Item
Barcodes, serial numbers and QR codes aren’t just useful for retail businesses. By adding a code or number to each item in your inventory, you’ll be able to keep track of everything at the click of a button. Therefore, even if someone does take too much equipment in error, you can find out what happened to it and who has it in their possession.
With a field service management platform like BigChange, your engineers can use the mobile app to scan items in and out of storage with ease. Whilst digital processes lower the risk of engineers forgetting to sign gear in and out, they also enable your back-office team to live track individual items without needing to scan through pages of handwritten notes.
3. Create Low Stock Alerts
When you use field service management software to handle your inventory, you’ll never have to worry about having enough stock. All you need to do is add in your minimum stock levels, and you’ll receive an alert whenever it’s time to replenish your warehouse.
In addition to saving time and reducing the amount of paperwork, a digitised inventory will save you money since it takes every item — including those in your engineers’ vans — into consideration. Therefore, there’s no risk of a false alert, which means you won’t be spending money on replacements when you don’t need to.
4. Create a Comprehensive Work Record
When trying to understand where parts have been used, don’t rely on paperwork, error-prone spreadsheets and legacy systems as a record of your work history. It’s likely to create confusion, and your engineers may needlessly end up replacing parts they replaced during the previous appointment.
Instead, you should use field service management software that keeps a comprehensive, accurate and detailed record of everything your engineers did during the appointment. Using their mobile devices, engineers can simply add the information to the platform and capture photographs of the work they carried out.
As a result, should you need to revisit a problem, you won’t end up using parts that you don’t need to. Aside from saving you money, a well-kept record will also enable your engineers to work more rapidly, impressing your customers and boosting your bottom line.
What Are the Benefits of Managing Your Inventory Efficiently?
1. Reduces the Chance of Human Error
Did you know that human error is the leading issue for just under half (46%) of warehouses? Many businesses struggle with large losses in inventory as poor reporting leads to inaccurate stock levels.
But, with field service management technology, managing your stock needn’t be a logistical nightmare. As we mentioned earlier, your engineers can simply sign tools and parts in and out of storage from their mobile devices, which enables your back-office team to track each item.
Having full, real-time visibility over your valuable assets means that there will never be inconsistencies in stock levels and, therefore, you’ll always have the items you need to get the job done perfectly the first time.
2. Your Business Will be Financially Stronger
Worldwide, inventory distortion results in an astronomical $1.1 trillion loss. In a post-COVID world, businesses can’t afford to lose money if they are to survive, so you must consider ways to improve your processes and eliminate any problems.
Digital inventory management systems give you the data you need to make better-informed decisions. Plus, with additional features that enable you to allocate stock directly to jobs and alert you when you need to reorder items, you can guarantee that you won’t be spending any money that you don’t need to.
3. Improved Efficiency
On average, companies spend approximately 16 days per year looking for paper documents that they’ve misplaced. In addition to losing paperwork, traditional administration methods are also time-consuming and usually riddled with mistakes.
In contrast, you can improve the efficiency of your staff — and your business — by removing the need for pointless admin tasks. Using BigChange’s field service management system, engineers can log all vital information (such as what parts they used during an appointment) from their mobile devices. The system stores all details so your back-office team can easily keep track of your inventory and work history.
With your engineers spending less time manually filling in forms each day, they will have more time to complete additional appointments and provide a superior service to your customers.
Field Service Management Software Helps Your Business Succeed
Currently, only 18% of small businesses use inventory management systems. The remainder either don’t track their equipment, stock and assets, or they use manual methods that create issues further down the line.
Consequently, that means that the majority of SMEs (small to medium-sized businesses) are missing out on an excellent opportunity to improve their operation, increase profits and take on more projects that will help contribute to company growth.
With BigChange’s field service management system, you can do the following:
- Add serial numbers, barcodes and QR codes to each item so you can track their whereabouts
- Allocate stock, equipment and assets directly to jobs
- Set up low stock alerts based on your preferences
- Manage your inventory across multiple locations
- Keep a comprehensive record of all work your engineers carry out for future reference
With such a powerful tool at your fingertips, your inventory will run like clockwork, freeing up more time for you and your team to focus on more business-critical tasks.
Handle Your Stock, Equipment and Assets with Ease on BigChange’s Inventory Management System
With BigChange, you can create a detailed register of assets and equipment — both for you and your clients — on one easy-to-use system.
Manage items across a range of locations in real-time and view a complete record of your engineers’ work history. Receive alerts any time your stock is running low. Assign vehicles, tools and equipment directly to customers’ appointments. Keep track of all assets using serial numbers, barcodes and QR codes.
Inventory management has never been simpler.
Discover how BigChange can make your business grow stronger here and arrange a free demo today.
SIGN UP FOR BIGCHANGE NEWS AND RESOURCES
By clicking ‘Subscribe’ you confirm you are happy to receive regular email newsletters from BigChange. You can unsubscribe from these emails at any time.