Excel and other worksheet programs have served manufacturers for decades, but for those looking to expand, or who have trouble tracking robust inventory, know that Excel just isn’t going to cut it.
Inventory managers today need a comprehensive program, one that allows for clear communication and detailed reporting, all without the need for tedious manual keying and coding of spreadsheet formulas.
We acknowledge there are plenty of situations where Excel or other worksheet programs can work well. If your business deals in a small number of SKUs, or you only have one or two inventory managers with a couple of suppliers, then Excel can be an affordable solution. Not to mention the infinite tutorials that you can find online to help your inventory tracking journey.
It is when your business begins to grow and you need your software to grow with you that these solutions can quickly fall behind your needs.
When Should I Switch from Excel?
As good as Excel is, maintaining large macro-filled spreadsheets becomes unworkable beyond a certain point. As your SKU count doubles and triples, combined with a corresponding increase in the number of suppliers you deal with, accuracy and timeliness begin to suffer from a manual worksheet solution.
So, what signs should you look out for to let you know when it’s time to move away from spreadsheet inventory management?
- You have trouble determining what you have in stock and what you need
- It is often time-consuming to find pertinent information
- Inventory levels are no longer accurately reflected
- Data entry errors happen frequently and are tough to locate
- One expert maintains your spreadsheet
- Your volume of and variety of MRO is growing (> 500 items)
- Reporting needs to be more sophisticated than spreadsheets can deliver
- You’re often running out of things, or you’re carrying a lot of inventory you don’t need
If this sounds like your business, where do you go from here?
Accounting software and Enterprise Resource Planning (ERP) software might be your next stop, but typically, these systems are not designed for indirect and MRO materials. These high-volume and lower-cost items play a pivotal role within your business to ensure operations run smoothly with minimal downtime.
How Inventory Management Systems Can Help
Inventory management system capabilities are specifically designed to address pain points that operations experience every day. Today’s inventory management systems work in real-time. From employees emptying the crib to managers handling procurement, you will have an accurate view of your stock and stock on order, by individual item or by category. As well, modern systems rely on Cloud technology which means rapid and easy deployment with no installation required.
Dedicated inventory management programs offer significant improvements over spreadsheets, allowing for greater efficiency, accuracy, and planning. As well, unlike Excel, modern inventory systems can leverage real-time information generated via barcode scanning or RFID detectors, making issuing and receiving a breeze, with minimal data entry by the user or storeroom attendant.
Inventory systems, when integrated with e-procurement, will automatically issue a PO to replenish low stock using your preferred protocol be it Kanban or Min/Max. When receiving the parts, the quantity can be verified against the PO. This not only makes procurement an easy task but also helps simplify your receiving and reduces errors throughout the entire cycle.
You might be asking yourself if you need all these features and that is a valid concern. But the power of a properly attuned MRO management system gives your entire workforce access to the information and features to make them more productive. Every employee from the storeroom to the shop floor can play a role in both accessing and updating your critical inventory information, helping you to realize the efficiency and benefits likely missed with a spreadsheet solution. Having necessary MRO on-hand ensures that you minimize equipment downtime. Or if you deploy MRO for service delivery you don’t miss out on revenue generating opportunities.
Other Benefits to Consider
Spreadsheets were a great innovation when introduced in 1979. Does anyone remember Excel’s precursors VisiCalc or Lotus 1-2-3? Despite advances in spreadsheet capabilities, they remain single-user tools. Therefore, when multiple people access a spreadsheet, only one person can update the contents at a time with subsequent users restricted to read-only access. Read access is acceptable for reporting but is inefficient when multiple people issue or receive inventory and all need to update the spreadsheet. In contrast, inventory management software is designed to support multiple users, at multiple locations, including scenarios where more than one user is updating quantities to the same item in inventory.
Data visualization and analysis are available in spreadsheets through pivot tables and graphical reporting, but require the user to create the reports.
Inventory management software comes packaged with standard reports such as usage, receiving audits, returned items, and unused inventory. They also allow users to create custom reports by selecting report data fields rather than having to define formulas in a spreadsheet. Advanced systems come with easy-to-customize real-time reporting dashboards to ensure everyone has access to business data in a clear and concise format.
One further consideration is integration. Spreadsheet data can be imported into other business systems but not on a real-time basis. Inventory management systems can integrate in real-time with accounting and Enterprise Resource Planning (ERP) systems to ensure data accuracy and to eliminate manual data entry.
Want to Learn More?
We aren’t saying that you can’t use Excel, but we hope we’ve highlighted that when it comes to managing your inventory, saving money upfront by using spreadsheet management may lead to unexpected costs on the backend.
Whether you’re running inventory management for a manufacturer, retail company, construction enterprise, or even facility management, and are interested in moving beyond spreadsheets, Tofino offers an inventory management solution that ensures you stay one step ahead of your evolving requirements. We will even help you with the transition, just give us a shout today to request your demo.