Inventory management is all about having a system for storing and selling inventory. Combined with accounts payable and accounts receivable, it amounts to more than $1 trillion in assets. Inventory management starts with the sourcing of raw materials and ends with the selling of your products. With a good inventory management system, you will have the right amount of materials at the right time, at the ideal price.
But it’s not enough to have a good inventory management system. If you want maximum efficiency for your business, you should think about integrating your inventory management with accounting. If you are running a multinational business, then you should make that integration a multilingual one. Just by having inventory management software alone, you already have an advantage. That’s because 43% of American businesses are still not tracking inventory. Or if they do so, they do it manually.
In this article, we will go through the best practices for integrating your inventory management and accounting software. We will also look into adding a multilingual component to the integration with the help of a translation company.
Integrating Inventory Management with Accounting
Before we go into the details of how to integrate your inventory management software with your accounting software, we need to discuss why it’s a good idea. There are many benefits of integrating your inventory management with accounting, but we will focus on the three main ones.
- Optimize your inventory to meet your ROI goals
- Give adequate visibility to your partners in the supply chain
- Have accurate statements of your inventory on your financial reports
Optimizing your inventory is all about having the right amount of inventory at the right time. It’s not a solution to just have a lot of inventory because that would mean tied-up capital. But you also don’t want an inventory that’s so small that it cannot meet customer demand.
By connecting your inventory management with accounting, those who order your inventory and those who handle sales will have a big-picture idea of your inventory situation.
If you have supply chain partners, then you need to tie in your inventory management with their back office as well. That way, they can make adjustments with what they supply to you based on real-time data.
Because your inventory can take up a significant portion of your stated assets, it is best if you have an accurate statement of it on your financial reports. By integrating your accounting with your inventory management, you will have up-to-date numbers that you can show on your reports that will be submitted to the government.
Integration Tips
Integration can be a long and complicated process. It is made even more complicated if your business is in the middle of operations. You cannot just pause everything to conduct the integration. Here are a few integration tips that you can follow.
Multilingual Integration and Working with a Translation Company
If you’re running an international operation, then you may need to have different versions of your inventory software. For example, if you are running operations in Latin America, you can use the Spanish version of the Fishbowl Go management app. For additional help with translating communications, you can turn to a translation company.
As for picking the right translation company, the top names are still the best options. You can find a lot of positive reviews online about Lionbridge on how they handle translating documents and it seems they have a good system in place. I’ve also heard great feedback about Tomedes since they assign experts on the specific niche of their clients to ensure relevance and accuracy, and they work frequently with app and software companies. Always choose a translation company over individual freelancers for this kind of work.
Schedule a Test
There will always be bugs when you integrate your inventory management software with the accounting software you are using. It’s never going to run smoothly on the first try. So, you have to schedule a test when you can check on how well the integration is working.
Scheduling can be tricky because you are still running operations. So, you may have to pick a time when your operations are slow so there will be less impact on your business.
Do It in Increments
You need to conduct your integration in phases. Software integration is very complicated and even in the best cases, there are always some bugs that will come up. It’s better to do the integration in phases so you can fix bugs as they come one at a time.
Make Sure You Know the Cost
Before you proceed with the integration, make sure that you are aware of the total cost. That should include the cost of maintenance and training. You need to know this before you invest in the integration or you could end up spending more than what you are planning on.
The best thing for your business is to have your accounting and inventory management software integrated right from the start. But if you have established both systems separately before, you can still integrate them quite smoothly. It just takes planning and a lot of coordination to make it work.