A big thank you to everyone who registered for our webinar!
Here is a little summary if you missed out!
What is Stock Management?
The process of ordering, storing, tracking and controlling inventory.
This is generally managed within your job management software.
What are the common risks & mishaps of not managing stock?
- Inaccurate Stock Levels
- Inflated Gross Margins
- High Stock Value left unused
- Recording stock inaccurately on your balance sheet
- Keeping inaccurate inventory which influences your P&L
- Getting your staff to follow processes to record stock and look after your equipment (such as vehicles)
Advantages of stock management
- Accurate Stock Levels
- Ability to quickly restock (minimum and restock levels)
- Accurate job costs
- Accurate reporting
- Ability to minimise the cost of holding stock
- Insightful reporting (quantity of items sold)
- Cost savings! Your suppliers will love your consistent ordering
- Employee Accountability
Choosing the right job management software is fundamental in making sure you can have the right features for your business, now and in the future.
- Job WIP: understand how much the job has cost you that hasn’t been invoiced
- Profit & Loss: you should be looking at this very regularly to keep an eye on you revenue, expenses and profit margins
- Stock Allocated: indicates any gaps in your stock, whether your stock hasn’t yet been allocated to a job, or may have been forgotten
- Stock Unallocated
- Stock Value
These reports ensure you are watching your profit and keeping the system clean.
How to implement?
The good news – you’re already doing it!
- Raise a Purchase Order
- It goes to stock
- Use materials on a Job
- The cost is added to the job
- The item is removed from your stock levels
So why does it seem so hard?
Because your stock needs to be set correctly at the beginning.
How can you fix it so it works for you?
- Arrange a stocktake
- Organise a team barbeque and get your calculators ready
- Turn on email auto-replies / put a sign on your door (pick a date and stick to it!)
- Once you’ve done right once, you probably only need to do it again every 6 months
- Add the items into your job management system (on the same day or immediately the next)
- Some job management systems allow for barcode scanning
- Do your data entry straight away, otherwise you’ve done it for nothing!
- Prepare a training manual for all staff (especially technicians) so everyone knows how to allocate stock
- Hold everyone accountable to checking out stock!
The only wrong plan, is to NOT have a plan! So make sure you get started today, and tackle this beast one step at a time.
Other tips and tricks:
- Recording returns: take it back to the supplier who issues a credit note, which you allocate against the original PO, and that will remove the items automatically
- Warranty: both items should be sitting on the job as a cost (original and the second item obtained from the supplier as a replacement)
- Warehouse receipting: have someone dedicated to counting stock as it comes in
Modus Operandi can help you by:
- Doing your data entry after you’ve done your stocktake
- Catalogue management
- Updating your system
- Training for your staff and providing manuals, or just pointing you in the right direction!
Contact us today to see how we can support you:
Tradies Accountant will assist with the following functions:
- Entering bills and matching to purchase orders
- Checklist of the accounting functions
- Delivery of reports timely function
- Strategy off the back of the reports
Contact us today for a free consultation!