An inventory control system helps businesses track stock accurately, reduce manual work, and make better decisions about purchasing, fulfilment, and cash flow. Choosing the right system depends on how your business operates today, how quickly it is growing, and which features, integrations, and reporting tools you actually need.
Key takeaways:
- Perpetual inventory systems update stock in real time, while periodic systems rely on manual counts at set intervals
- Barcode, RFID, and cloud-based platforms can improve stock accuracy and reduce manual data entry
- The right system should match your product range, order volume, sales channels, and required level of automation
- Scalability matters because changing systems again as the business grows can be costly and disruptive
- Integration with accounting software, ecommerce platforms, and POS systems helps keep data consistent across the business
- Ease of use, training, support, security, and customisation should all be considered alongside price
- Strong reporting and dashboards help businesses identify stock trends, improve forecasting, and make more informed inventory decisions
Choosing the right inventory control system is one of the most important operational decisions a growing business makes. The right system directly affects your cash flow, your customer experience and how much time your team spends on manual stock work. This guide explains what an inventory control system is, the main types available, and the key factors to weigh up before you commit to one.
Inventory management is a critical part of any business that deals with products or goods. Having an efficient inventory management system in place can help reduce costs, improve customer satisfaction, and increase profitability. But with so many options available, choosing the right inventory management system for your business can be a daunting task. In this blog, we take a look at the factors to consider when selecting the right solution for your business.
What is an inventory control system?
An inventory control system is the combination of software, processes and hardware a business uses to track stock levels, orders, sales and deliveries across all of its locations. At its simplest it answers three questions: what do we have, where is it, and when do we need to reorder. In practice this ranges from a basic spreadsheet through to a dedicated cloud platform such as Cin7 Core that connects your sales channels, warehouse and accounting in real time. The goal is the same at every level: accurate stock data you can act on, with less manual work and fewer costly errors.
Types of inventory control systems
Inventory control systems are usually grouped by how stock is counted and by the technology used to track it.
Perpetual inventory system
A perpetual system updates stock levels continuously in real time as sales and receipts happen, normally through barcode or RFID scanning linked to software. It gives the most accurate, up-to-date view and suits businesses with high order volumes or multiple sales channels.
Periodic inventory system
A periodic system relies on manual stock counts at set intervals, such as monthly or quarterly. It is simpler and cheaper to run, but it is not real time and leaves more room for error, so it tends to fit smaller operations with a limited number of stock lines.
Technology used to run these systems
- Barcode systems: scan items to update records quickly and cut manual entry errors.
- RFID systems: use radio tags to track items without line of sight, which is useful in larger warehouses.
- Cloud-based inventory software: platforms such as Cin7 centralise data across channels and integrate with accounting and ecommerce tools.
Once you understand the type of system you need, the next step is to compare providers against the following criteria.
- Business needs: Before choosing an inventory management system, it’s important to determine your business’ needs. Identify what type of products you sell, how much inventory you have, and how many units of product you sell. This will help you determine the level of automation, scalability, and features you require in your inventory management system. A good starting point would be to list down your business requirements, such as inventory tracking, demand forecasting, order management, and reporting.
- Scalability: Your chosen platform should be able to scale as your business grows. Consider the size of your business and how quickly it could grow. Choosing a system that is scalable is a great way to future-proof your investment and reduce the need (and hassle!) of switching to a new system as your business grows.
- Ease of use: Your inventory system should be easy to use and navigate. The system should have an intuitive interface that allows your team to access and manage inventory with ease. Choosing a system that is user-friendly will help reduce training costs and errors. Systems like DEAR are extremely user friendly and we can provide training to help support you through the transition of using your new system.
- Integration: Your inventory management system should be able to integrate with your other business systems such as your Point of Sale (POS) system, accounting software, and eCommerce platform. This integration will help automate data transfer, reduce manual data entry, and improve accuracy.
- Cost: The cost of your chosen inventory management system should be considered when making your decision. Determine the upfront costs, monthly subscription fees, and any additional costs such as training and support. Compare the costs of different systems and choose the one that offers the best value for money.
- Support and Training: Ensure that the inventory management system provider offers adequate support and training, or you have access to experts (like us!) who can support you through the change. This will help you understand the system better, troubleshoot any issues that arise, and ensure that your team is proficient in using the system. Additionally, you can be sure that your chosen system fulfils your needs effectively.
- Customisation: Every business has their own unique requirements. Choose an inventory management system that can be customised to meet your business needs. This customisation could include elements like creating custom fields, automating workflows, and setting up alerts and notifications.
- Security: Data is king, so ensure that the inventory management system provider has robust security measures in place to protect your data. This includes data encryption, regular backups, and access control.
- Reporting: A good inventory management system should offer you comprehensive reporting capabilities. This will help you to analyse your inventory data, identify trends, and make data-driven decisions. Ensure that the system offers customisable reports and dashboards.
Choosing the right system for your business requires careful consideration of your business needs, scalability, ease of use, integration, cost, support and training, customisation, security, and reporting capabilities. Take the time to evaluate different systems on the market and choose the one that best meets your requirements.
Need some support? Get in touch with our team today to discuss your current system, areas of concern and your vision for your business.
If you are replacing an existing setup, it is also worth reading about the common challenges of implementing an inventory management system so you can plan around them before you switch.
Frequently Asked Questions
What is an inventory control system?
An inventory control system is the software, processes and hardware a business uses to track stock levels, orders and deliveries across its locations, so it always knows what it has, where it is, and when to reorder.
What are the main types of inventory control systems?
The two main types are perpetual systems, which update stock in real time through barcode or RFID scanning, and periodic systems, which rely on manual counts at set intervals. Most growing businesses use a perpetual, cloud-based system for accuracy across multiple channels.
What is the difference between an inventory control system and inventory management software?
Inventory control focuses on tracking stock quantities and locations. Inventory management is broader and also covers forecasting, purchasing, supplier management and reporting. Modern platforms such as Cin7 Core combine both in one system.
How much does an inventory control system cost?
Costs vary widely. Basic tools can be low cost, while dedicated cloud platforms usually run on a monthly subscription based on users, orders or locations, plus any setup and integration work. The right level of investment depends on your order volume and number of sales channels.
Which inventory control system is best for a small business?
For most small businesses a cloud-based system that integrates with your ecommerce and accounting tools offers the best balance of cost and control. The best choice depends on your channels, stock volume and growth plans, which is where a specialist review helps.
