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Implementing an effective inventory control and planning solution is only the first step in optimizing your inventory management. Another important component of this process that’s often overlook is the set of rules you establish to speed up inventory control and make it more effective. Having to stop and consider every simple inventory decision you make is not only time-consuming, but can be counter-intuitive. It also makes it much harder for you to delegate inventory control or aspects of it to your employees.

There is no simple strategy for making the right inventory decision all the time. While a small, specialized e-Commerce store and a large local retailer both aim to streamline inventory control and maintain optimal stock levels, they may use different decision rules to achieve their ends. It’s more intuitive to think of decision rules in terms of objectives, variables, restraints. Let’s look at each of these in turn.


Essential inventory rules for all businesses include reducing ordering costs, controlling inventory costs, and selling inventory at the right price to factor in for ordering and holding costs. With an inventory control and planning solution like DataQlick, many of these numbers are added up in real time, so you can always check them at a glance for both individual products and product categories.

By having easy access to this data, you and your inventory staff can determine more quickly whether ordering, shipping, or moving certain stock is profitable or not. When it is not, a flag can be raised. A more in depth appraisal of the stock in question can then shed light on the best strategy for dealing with it. But in general, time-sensitive decisions can be made faster based on previous experiences with similar products.


Variables are another crucial factor when it comes to inventory rules. The can include the product cycle time from supplier to your warehouse, as well as minimal safety stock levels. An effective approach for dealing with these variables is to develop just-in-time inventory rules, which aim to reduce inventory costs. Factoring in variables becomes easier with an inventory control and planning solution that monitors stock in real time.

Decision-making can be simplified by using automated rules that order new stock once the existing stock levels fall below the minimal threshold, as defined by previous demand data. Instead of having to manually order new products on a regular basis, or having someone do it, you can rely on your online inventory app to do the ordering for you.


To set up effective decision rules, it’s also important to consider inventory restraints such as handling costs, inventory age, or storage costs. Sometimes it’s better to drop certain products from your stock or choose alternatives not because they don’t sell, but because storing or moving them is costing too much. At other times, you will be able to substitute slow moving products with others that, even though more expensive, move faster. Identifying your biggest inventory restraints and dealing with them becomes easier when you use a QuickBooks inventory app that can help you tap fast into all your accounting and inventory data.

As you can see, inventory management for small business entails setting up inventory rules that aren’t necessarily straightforward. “Order X if Y,” or “Replenish stock when X,” may help speed up your inventory management, buy won’t necessarily make it more effective. The best decision rules for inventory control are automated actions, like the ones that an inventory control and planning solution can make for you given specific stock performance, such as automated stock replenishment based on stock warnings. Learn more about DataQlick here.