Inventory Monitoring System 101: A Walkthrough by Experts

Inventory management is crucial for any successful business, and an effective inventory monitoring system can be a game-changer. 

When discussing the topic of inventory tracking, keep in mind that: 

• Inventory monitoring is not a whole process of inventory management. 
• There are multiple types of inventory tracking systems. 

But trust us, these notions don't just stop at the notes we give you. Ready to learn the intricacies around them yet? If yes, we'll now walk you through every aspect of an inventory monitoring system and its roles in your business operation.

Let's get the ball rolling! 

Understanding the Term "Inventory Monitoring System"

We'll now come to the basics of a inventory monitoring system, which refer to: 

• What the notion of inventory monitoring means
• How such a system works
• What functionalities should be presented in a stock monitoring system

Let's keep you waiting no longer and dive deep into each section right below!

What exactly does inventory monitoring mean?

Inventory monitoring is part of inventory management. It focuses on tracking and recording inventory levels, which includes counting stock, checking for damages, and updating records.

On the other hand, inventory management covers a wider range of tasks to optimize inventory levels. This includes predicting demand, ordering from suppliers, and deciding the best stock levels. Inventory management also uses data from inventory monitoring to make smart decisions about future stock levels.

That's inventory monitoring vs inventory managing. Now moving on, we have the term "inventory monitoring system". Take it as a technological tool designed to automatically track and record the quantity of products or materials within a business's inventory. 

Normally, a stock monitoring system utilizes barcode scanning technology to swiftly and accurately identify individual items. Simultaneously, it provides real-time updates on inventory levels, ensuring that businesses are always aware of their stock status.

You may find inventory tracking systems in diverse settings, including warehouses, retail stores, and manufacturing facilities. Since their functions are to streamline inventory management processes, they contribute to improved efficiency, cost reduction, and overall operational effectiveness.

How does an inventory monitoring system work?

The mechanism of inventory monitoring software is simple. It assigns a tracking number to one item while associating several data points as well. The assigning method could vary from one system to another because there are more than one type of monitoring system (we'll explain in the next part). 

However, they all assign a tracking number and relevant details. Such assignments will help the system  to identify, track, update, or report later on. And that's how one inventory monitoring system operates. 

What are the key functionalities of an inventory tracking system?

Speaking of inventory tracking systems, and our team think they should include the following key features: 

• Real-time inventory tracking: Provides immediate visibility into inventory levels across all locations, helping businesses make quick and informed decisions to prevent both stockouts and overstocking.
• Barcode scanning and RFID: Utilizes automated data capture methods such as barcode scanning and RFID tagging to streamline the tracking process, reduce human errors, and enhance operational efficiency.
• Alerts and notifications: Generates automatic alerts when inventory levels reach predefined thresholds, enabling proactive replenishment and reducing the risk of running out of stock.
• Reporting and analytics: Offers comprehensive reporting tools that analyze inventory performance, track trends, and identify variances. This data-driven approach supports better forecasting and inventory optimization.

Other functionalities that are nice to have in a stock monitoring system: 

• Demand forecasting: Uses historical data and advanced algorithms to predict future inventory needs. Such functionality is to ensure businesses can maintain optimal stock levels and meet customer demands. 
• Integration with other systems: Ensures seamless connectivity with ERP, accounting, and other business systems, eliminating data silos, reducing manual tasks, and providing a complete view of business operations.

How Many Types of Inventory Monitoring Systems are There?

Inventory monitoring systems come in various types, each suited to different business needs. The right inventory tracking system for you depends on factors like your business size, inventory complexity, and the level of automation desired.

• Manual systems are the most basic, relying on physical counting and manual record-keeping. While simple, they can be slow and prone to errors. This inventory monitoring system type is mostly seen in home workshops and small retail stores. 
• Barcode scanning systems use barcode scanners to track items. The method is common in retail and warehouses due to its accuracy and efficiency. 
• RFID (Radio Frequency Identification) systems involve attaching RFID tags to products, enabling automatic tracking. These systems are often used in supply chain management and help prevent theft.

Some other names you may hear when searching the term "inventory monitoring system" are cloud-based inventory management software, warehouse management systems, and manufacturing execution systems. They go beyond stock tracking and here are some information about them: 

• Cloud-based inventory management software offers flexibility and advanced features like analytics. It’s popular among small to medium-sized businesses and the eCommerce industry (Shopify, WooCommerce, Amazon, Etsy, etc.) for its scalability and ease of use. 
• Warehouse management systems (WMS) are designed for large warehouses, offering features like automated picking and storage optimization to handle complex operations.
• Manufacturing execution systems (MES) are tailored for manufacturing, tracking materials and products throughout the production process to ensure efficiency.

How Do You Make an Inventory Tracking System?

If you choose to build your inventory tracking system, here's a brief guide for you: 

• Step 1: Define your needs. This means you have to identify items to track and their details (e.g., quantity, location). Then, choose features you need, like alerts or reports.
• Step 2: Choose a platform. You can go for a simple inventory tracking system like Google Sheets in case you are running small inventories. Or else, go for an advanced one like Airtable, Microsoft Access, etc. 
• Step 3: Set up your system. Now you need to design how data will be organized and categorized. After that, establish workflows for tracking and integrate with other tools if needed.
• Step 4: Implement tracking methods, which can be manual (physical counts for small inventories) or automated (barcodes, tickets, RFID, or IoT devices for complex inventories). 
• Step 5: Test and refine. Once you've reached this step, run a pilot test and make necessary adjustments to your inventory monitoring system. 

When building an inventory system on mobile, consider using AppAlloy - a no-code app builder. With AppAlloy, you can drag and drop to create an inventory tracking system from data on Google Sheets while captivating a stunning application.

5 Best Inventory Monitoring Systems in 2024

1. EZRentOut 

Rating on Capterra: 4.6/5

Pricing

• Starts at $89 to $349 per month. For enterprises, contact the team to discuss your custom plans. 

EZRentOut is a cloud-based software solution specifically designed to manage and streamline the equipment rental process for businesses across diverse industries. This software allows businesses to track and manage their rental equipment in real-time, ensuring that inventory levels, maintenance schedules, and customer reservations are always up-to-date. 

EZRentOut also integrates seamlessly with other business systems, such as accounting and CRM software, providing a holistic view of your operations. In terms of inventory monitoring, the platform supports features like barcode scanning, RFID integration, and mobile access, making it easier to handle the complexities of equipment tracking and management from anywhere. 

Features that users value the most: 

• Inventory updates, alerts, and control 
• Barcode and ticket scanning 
• eCommerce management 
• Purchase order management 
• Asset tracking 
• Multi-location support 
• Online booking 

Who EZRentOut is for: 

• Companies in construction and heavy equipment rental 
• Event management companies 
• Educational institutions 
• Retailers and business services (medium to large scale) 

2. UpKeep 

Rating on Capterra: 4.6/5

Pricing:

• From $20 to $75 per month 

UpKeep is a mobile-first asset operations management software designed to streamline inventory monitoring and management for businesses. Since its founding in 2016 by Ryan Chan, UpKeep has become a top choice for maintenance teams due to its ease of use and accessibility.

The inventory monitoring system offers powerful inventory management tools, allowing businesses to track parts, tools, and other assets in real-time. With features like automated stock alerts and reorder points, UpKeep helps prevent inventory shortages and overstocking, ensuring that maintenance teams always have the necessary supplies on hand.

More than that,  its mobile capabilities enable users to manage inventory from anywhere, making it easy to update stock levels, scan barcodes, and monitor usage on the go.

Features that users value the most: 

• Mobile-first approach 
• Inventory updates, alerts, and control 
• Barcode and ticket scanning 
• Purchase order management 
• Asset tracking 
• Warehouse management 
• Vendor management 

Who UpKeep is for: 

• Mostly for organizations, yet, they can be from various industries (education, hospitality, healthcare, transportation, etc.) 

3. ShipStation 

Rating on Capterra: 4.6/5

Pricing:

• Free plan is available 
• Pricing tiers vary from $9.99 to $299.99 
• Custom plans for enterprises are open to discussion

ShipStation is a shipping and fulfillment software designed to simplify the shipping process for eCommerce businesses. By integrating with over 70 selling platforms like Amazon, eBay, Shopify, and Etsy, ShipStation allows businesses to manage all their orders in one place, streamlining operations and improving efficiency.

One of ShipStation's standout features is its inventory management capabilities. The platform enables businesses to track stock levels in real-time, set alerts for low inventory, and ensure they have the products needed to fulfill orders without delay. 

Features that users value the most: 

• Real-time inventory updates
• Inventory allocation
• Inventory adjustment
• Inventory reports
• Multichannel integration 
• Barcode and ticket scanning 
• Warehouse and order management 

Who ShipStation is for: 

• eCommerce retailers (small to medium scale) 
• Dropshippers 
• Retailers with online storefronts
• Third-party merchants on marketplaces like Amazon, eBay, Etsy, etc. 

4. Zoho Inventory 

Rating on Capterra: 4.5/5

Pricing:

• Pricing tiers vary from $29 to $249

Zoho Inventory is another advanced cloud-based platform designed to simplify inventory and order management for eCommerce businesses. It provides an extensive array of tools to manage inventory, streamline orders, and handle shipping processes with ease.

The automated inventory tracking system feature highlights include multi-warehouse management, item grouping, serial and batch tracking. Businesses can oversee inventory across various locations, manage stock levels efficiently, and ensure real-time updates across multiple sales channels.

Features that users value the most: 

• Serial number tracking 
• Batch tracking 
• Multi-warehouse management 
• Item grouping 
• Real-time stock syncing 
• Vendor management 
• Inventory report and analytics 
• Multi-channel integration 

Who Zoho Inventory is for: 

• eCommerce retailers 
• Businesses (mostly small scale) 
• Wholesalers 
• Distributors 
• Manufacturers 

5. Asset Panda 

Rating on Capterra: 4.6/5

Pricing:

• Features a pay-as-you-go model (the more you use, the higher you are charged)

Next on our list of the best inventory monitoring systems is Asset Panda - an adaptable asset tracking and management software for optimizing asset management.

The software excels in inventory monitoring and offers detailed tracking capabilities within its operational niche. Users can log essential information such as purchase details, maintenance schedules, and service contracts, along with adding photos, documents, and videos related to each asset. The mobile app enhances this by allowing for onsite audits and barcode scanning, making it easier to access and update asset information on the go.

Asset Panda also supports comprehensive lifecycle management, covering everything from procurement to disposal. It helps in identifying and removing "ghost assets" - assets that are no longer in use but still listed - thereby improving financial accuracy and reducing costs associated with unused assets.

Features that users value the most: 

• Low-stock alerts 
• Barcode scanning 
• Inventory tracking and report 
• Centralized asset database ]
• Vendor management 
• Work order management 
• Warehouse management 

Who Asset Panda is for: 

• Companies in various industries, such as technology, education, construction, etc. (Mostly medium and large scale) 

How do you monitor inventory?

There are a few methods to monitor your inventory, depending on your business scale and model: 

• Manual counting: Physical counts of items
• Barcode or ticket scanning: Using scanners to identify and track items
• RFID: Using tags to automatically identify and track items
• IoT sensors: Using sensors to monitor inventory levels
• Cloud-based software: Real-time updates and analytics
• POS integration: Updating inventory based on sales

When it comes to monitoring your inventory and choosing an inventory tracking system, take these following factors into consideration: 

• Inventory type
• Update frequency
• Budget
• Accuracy requirements

What are the most popular types of inventory system

• Online retailer: An online retailer would likely use an eCommerce platform with built-in inventory management capabilities. This platform would track product quantities, manage stock levels, and automatically update inventory when orders are placed.
• 3PL warehouse: A third-party logistics (3PL) warehouse that stores and distributes products for multiple clients might use a sophisticated warehouse management system (WMS).
• Government agency: A government agency that manages a fleet of vehicles or equipment might use an asset management system with inventory tracking capabilities. Such an inventory monitoring system can track the location, condition, and maintenance history of assets.