With Inventory Valuation Tools, Know What Inventory is Worth at Any Time

Warehouse Management System Inventory Valuation

For a variety of important financial and compliance reasons, a business needs to know the value of its inventory at any given time, whether it's company owned inventory or customer owned inventory. A Warehouse Management System provides inventory valuation with precision.

The first step is to have accurate inventory counts. It’s impossible to properly value inventory without knowing what’s in the inventory, and a WMS provides inventory counts with greater than 99% accuracy.

The Warehouse Management System also knows the cost associated with each product. Cost analysis tools track average cost, standard cost, and actual cost for each product or group of products.

Warehouse Management Systems provide the complete, accurate picture of inventory valuation so a business always knows the value of what's in stock.

On the pricing side, the WMS can offer multiple pricing models, default and custom. This gives businesses unlimited flexibility in creating special pricing for certain customers without having to define pricing for each and every customer.

Warehouse Management Systems let a business know the value of inventory at any given time, which is critical for reasons primarily related to accounting, cash flow, and insurance.

  • Accounting: The value of the inventory affects deductions, capital, assets, and equity. It’s impossible to have accurate accounting statements without accurate inventory valuation.
  • Cash flow: Without accurate inventory valuation, it would be easy to overstock and constrain cash flow. Inventory valuation also affects the ability to borrow because the value of the inventory is part of the value of the business.
  • Insurance: A business needs to know the value of its inventory in order to have appropriate insurance coverage and to be properly reimbursed in the event of flood, fire, or other catastrophe. This is perhaps even more important to a business holding other businesses’ inventory on consignment.

Warehouse Management Systems provide the complete, accurate picture of inventory valuation so a business always knows the value of what's in stock.

Next: 7 Signs a WMS is Needed>>

WMS Home

powered by Essent® • SiteBuilder Pro