Creating a spreadsheet-driven warehouse management system (WMS) using Excel or Google Sheets can be a cost-effective solution for small businesses with simple inventory management software.
Using excel inventory management software will help you automate your supply chain, track your inventory across all sales channels, and update your inventory counts in real time. This will save you time and help you grow your business faster.
This blog post will discuss both the benefits and limitations of using inventory management software in excel. We will explore more about the potential of warehouse management system excel in maintaining inventory.
Why do we need an inventory management excel template?
Excel inventory management is a way to track your inventory using Excel spreadsheets. It can be a good way to get started with inventory management, but it’s important to be aware of the limitations.
Excel is a static tool, which means that it doesn’t update automatically. This can lead to errors if you’re not careful. Additionally, Excel can be difficult to scale as your business grows.
However, the WMS Excel can be a good option for small businesses with a limited budget. It’s also easy to get started with, and you can customize the spreadsheets to meet your specific needs.
Setting up excel warehouse management system
1. Inventory Master Sheet:
a. Product ID: A unique identifier for each product.
b. Product Name: Name of the product.
c. Description: A brief description of the product.
d. Unit Price: Price per unit of the product.
e. Stock On Hand: Current quantity of the product in stock.
f. Reorder Point: Minimum quantity at which the product should be reordered.
g. Supplier: Name of the supplier or vendor.
h. Location: Storage location within the warehouse.
2. Receiving Sheet:
a. Receipt ID: A unique identifier for each receipt.
b. Received Date: Date of receipt.
c. Product ID: ID of the received product.
d. Received Quantity: Quantity of each product received.
e. Supplier: Name of the supplier.
3. Order Sheet:
a. Order ID: A unique identifier for each order.
b. Order Date: Date of the order.
c. Product ID: ID of the ordered product.
d. Ordered Quantity: Quantity of each product ordered.
e. Customer Name: Name of the customer.
4. Picking Sheet:
a. Picking ID: A unique identifier for each picking task.
b. Pick Date: Date when the picking task is scheduled.
c. Product ID: ID of the product to be picked.
d. Picked Quantity: Quantity of each product picked.
e. Order ID: ID of the order associated with the picking task.
5. Shipping Sheet:
a. Shipping ID: A unique identifier for each shipment.
b. Ship Date: Date of shipment.
c. Product ID: ID of the shipped product.
d. Shipped Quantity: Quantity of each product shipped.
e. Order ID: ID of the order associated with the shipment.
f. Customer Name: Name of the customer.
A lot of additional sheets like Customer Master, Vendor Master, Pincode Master, Shipping Address Master, etc. are not included in this basic system.
Also, there will be a need to do a lot of cross-linking between sheets, and put in validations at the required places – to ensure basic data integrity. This will require spreadsheet skills beyond the intermediate level.
Key Features of Excel Warehouse Management System (WMS)
A WMS Excel typically includes the following features:
- Inventory Master Sheet: This sheet maintains a comprehensive record of all inventory items, including product details, quantities, and storage locations.
- Receiving Sheet: This sheet records incoming goods, including item descriptions, quantities, and supplier information.
- Order Sheet: This sheet tracks customer orders, order details, and order fulfillment status.
- Reports: Excel’s robust reporting features enable generation of various inventory reports, such as stock status reports, reorder point reports, and inventory valuation reports.
Benefits of Using Excel WMS for Inventory Management
Warehouse management excel offers several advantages for SMBs:
- Cost-effectiveness: Excel is a readily available tool, eliminating the need for additional software purchases.
- Familiarity: Most businesses are familiar with Excel, making it easy to learn and implement.
- Customization: Excel’s flexibility allows for customization of spreadsheets to suit specific inventory management needs.
- Data analysis: Excel’s built-in data analysis tools enable users to track trends, identify patterns, and make informed decisions.
Limitations on Warehouse Management System Excel
Limited Scalability
Inventory management systems excel are suitable for small businesses but may become unwieldy as inventory and operations grow.
Data Entry Errors
Warehouse management excel supports manual data entry can result in typos, duplication, and other inaccuracies, leading to incorrect inventory levels.
Real-Time Updates
Unlike dedicated WMS software, spreadsheet-based systems often lack real-time inventory updates, leading to discrepancies between the physical stock and the spreadsheet.
Limited Functionality
While excel warehouse management systems offer simplicity and affordability, they may not provide the advanced features needed for complex inventory management tasks.
Security and Access Control
Securing sensitive data in spreadsheets can be challenging, and controlling access for different users may be limited.
Lack of Reporting
Generating complex reports and analytics can be cumbersome in spreadsheets.
Audit Trail
Tracking changes and user actions in spreadsheets for auditing purposes is challenging.
Integration
Integrating spreadsheet-based systems with other business software (e.g., accounting software) can be complex.
Backup and Data Loss
Inventory management spreadsheet can be vulnerable to data loss if not regularly backed up.
Scalability
As your business grows, the limitations of a WMS excel become more evident, and transitioning to a dedicated WMS may become necessary.
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Conclusion
While spreadsheet-driven WMS can work for small-scale operations, it’s crucial to acknowledge their limitations and plan for future growth and complexity.
For more robust inventory management, consider investing in dedicated warehouse management software designed to handle the challenges and requirements of larger warehouses.