Managing inventories and orders is a critical component for any inventory-based business. The inability to track these items can lead to delayed orders, lost orders, and in a worst case scenario, a loss of customers. Carrying out inventory audits on a regular basis is essential to ensure that you avoid any operational headaches. That’s why businesses have turned to inventory audit software to save time, effort and money.
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What is an Inventory Audit?
An inventory audit is one of the most integral parts of the inventory management process. It includes the process of auditing the stock maintained in your company’s books against your physical stock. There are well-defined standards and guidelines you need to be aware of when it comes to inventory audits. Apart from these, there are a few factors to keep in mind before carrying out an inventory audit:
- Inventory of your raw materials, finished goods, or other assets may run into the hundreds or thousands of items
- Inventory may be stored in a single location or spread across multiple locations
- Inventory might be stored at your company’s location or the location of a 3rd party logistics provider
These factors add complexity not only to inventory management and control, but also in carrying out inventory audits. There’s no “one-size-fits-all” approach to consider. Each company’s inventory needs are unique. The bottom line is that your inventory is a critical asset that needs to be proactively managed, frequently reviewed and accurately counted. The most efficient way to do that is to use inventory audit software.
What is the Best Way to Conduct an Inventory Audit?
The standard way of conducting an inventory audit is to choose a selection of items, physically count how many of them you you have in your inventory and compare that to the records in your software. However, this approach might not work if you’re a part of a large organization with inventory stored in multiple locations. In such cases, using inventory audit software helps you keep better track of your inventory. The software also lets you know if your business’ procedures for inventory audits are effective, or if they need to be fine-tuned.
In addition, inventory audit software helps reduce both understocking and overstocking as a result of inaccurate data. It also helps cut down the risk of theft. Just having an inventory management system that manages your inventory isn’t sufficient. You need to consider inventory audit software as well as a well-defined inventory audit procedure.
Benefits of Using CMMS Inventory Audit Software
A CMMS (Computerized Maintenance Management System) is traditionally used to maintain a database for a company’s maintenance operations. However, CMMS software can also be used as inventory audit software because they give you considerable benefits during the inventory audit process. Those benefits include:
Cutting Down on Preparation Time
Scheduled audits mean getting your paperwork ready for the inventory auditor to assess. However, this can be time-consuming and tedious when your teams have to go through stacks of paperwork, especially if they’re stored in multiple locations. CMMS inventory audit software lets you prepare accurate reports in minutes. As a result, you save time and unnecessary frustration both for yourself and for the auditors.
Access to Verifiable Data
A CMMS records all of your asset stocking, ordering, and tracking, as well as the inventory processes for each work order. During audit time, accurate, current and historical data is available to auditors with just a few keystrokes. As a result, verification happens much quicker.
Easy Access for Auditors
Auditors shouldn’t have to wade through an ocean of paperwork or shift from one location to another. With CMMS inventory audit software, they have all the information they need right at their fingertips. Whether it’s on a computer or a mobile device, the data can be accessed anywhere.
How Do You Select a Robust CMMS Inventory Audit Software?
When it comes to inventory audit software, there are certain features to look out for in the CMMS you select for your business. Some of these are:
Real-Time Asset Management
Your CMMS inventory audit software should let you proactively manage your assets in real time, regardless of whether they’re stored in a single location or in multiple locations. The presence of this feature is critical to ensure that the inventory audit can be carried out seamlessly.
Facilitate Scanning and Tracking of Assets
Your CMMS inventory audit software should be able to scan the barcodes on your assets. Scanning an item, automatically records the item and stores the data in the CMMS. Ideally, the CMMS should have a built-in barcode scanning tool. If it doesn’t, then you should look into how easy or difficult it is to integrate such a tool into the software.
To properly analyze your inventory while auditing, your CMMS should have the ability to generate on-demand and scheduled reports. It should also allow you to generate customized inventory reports, depending on your industry and company’s unique requirements.
This software should also help you maintain inventory control by providing a complete snapshot of your inventory at any point in time. It should be able to track items; locate parts and materials; and provide inventory reports about in-stock and out-of-stock items.
Management of the Complete History of Your Assets
Important details regarding individual assets should be recorded in your CMMS inventory audit software. Some of the details that need to be recorded include purchase date, warranty, expected lifetime, specifications, service history, and maintenance activities.
Inventory auditing procedures differ from one company to the next, even within the same industry. Misplacing inventory numbers can lead to customer dissatisfaction, theft, or budgeting mistakes. Furthermore, you may run foul of your compliance requirements if there’s missing information unearthed by an auditor during an internal audit. The use of inventory audit software increases your efficiency, saves time and effort, and helps you ensure that you successfully meet compliance requirements.