How to Choose the Best Retail Inventory Management Software

Inventory is an integral aspect of your retail business. But choosing the best retail inventory management software to implement isn’t always easy. We hope to make the decision simpler for you by breaking down features to look out for, pricing considerations and the importance of reviews. 

According to research by Netstock, nearly 80% of small businesses struggle with both inadequate forward planning and overstocking. Overall, concerns related to supply chain issues this year led to overpurchasing. Larger businesses–those with 500+ employees–saw overstocking rise to 44%. 

With these issues in mind, retailers must tighten their focus to find a retail inventory management system that can help them accurately manage stock levels, predict demand and automate tasks. 

To keep up with competition and evolving consumer expectations, retailers need adaptive, feature-rich inventory management systems that support complex inventory needs and accelerate growth. 

In this article, we’ll discuss: 

• Factors to consider when choosing the best retail inventory management software
• Assessing the costs of inventory management software for retail
• The importance of reading reviews
• The best inventory management software for retail
• Lightspeed’s features of retail inventory management software

Factors to consider when choosing the best retail inventory management software

Before you choose a retail inventory management system, consider the following factors. 

Create a list of must-have features

Every retail business is different. Your business type, financial needs, number of stores and employees, customer demographics, product focus, competitor activity and more all factor into important business decisions. Based on these, what are your must-have features? They may include:

• 24/7 support
• Data and analytics
• Real-time tracking
• Automated workflows
• Intuitive interface
• Multistore management

Ultimately, you should create a list of non-negotiables to narrow down your options and find the right fit.

Evaluate ease of use

Any business software should be easy to operate. An intuitive interface, easily accessible features and tools, and a modern, updated platform make the implementation process smoother, especially when it comes to staff training. Additionally, an easy-to-use platform means deleting unnecessary steps from your workflow. Eliminating manual tasks to speed up ordering and fulfillment can mean wonders for your operational efficiency. 

Simply for Life, a retailer that sells health and beauty supplies, uses Lightspeed to simplify workflows. 

Systems coordinator Angela Logan says: “We’re able to pull a report of the top 100 products across our locations so that a new owner has a readily available inventory to choose from. With Lightspeed, this is quite easy to do and very helpful when we’re trying to open new locations. We are expanding and we’re going to continue to expand. It’s just that easy if you want to become a multi-location business.”

Evaluate accessibility 

The time of disconnected systems, juggling multiple providers and using out-of-date software is long past. Inventory management software that’s built-in to the system you already use to run your business allows for complete visibility over everything, from sales to stock levels. A cloud-based inventory system that unites all your channels allows you to track SKUs and gives you clarity into what’s selling at any time, anywhere. Plus, it’s important to have access to your operations on-the-go, so mobile accessibility is a big consideration. 

Ensure ease of integrations

A scalable system is one that connects to all the integrations you need as your business grows. Assess whether you are able to add modules, services and other add-ons to create a customized inventory management system that meets your exact needs. For instance: warehouse management systems, inventory planners and accounting software. 

Evaluate access to support

The best retail inventory management software should also have the best support. You should have access to experts in your field who can help you with onboarding, hardware setup, and any questions you may have when you first start. Support is equally important after setup. If something goes wrong, it’s crucial that you can access a chat or phone line to get your issue resolved. 

Gift shop Imagine Exhibition uses Lightspeed. Vice-president of retail operations Michael Slagle points out how important good support is to make a provider stand out.

“[Lightspeed] uploaded a lot of our POs initially because they knew we were out of time. That kind of mentality is just as important as having a great POS product. Knowing that the people that are behind it are going to do those things for us really helps differentiate Lightspeed,” he says. 

Scope for future expansion

Growth is important to staying competitive in today’s retail landscape. Most successful businesses don’t remain the same size for long, and there will eventually be a need for you to increase your inventory capacity and capabilities. Whether that means expanding your online presence, opening new stores or selling on social platforms, the inventory management system you use should help you streamline to balance the complexity of more SKUs, suppliers and product lines. 

Expansion can happen faster with the right POS and inventory management capabilities. Just ask Alissa Fiorito, owner of Le Brow Bar. 

“I can see everything, the products that sell quickly, the products that don’t. Lightspeed just has so much information. I don’t think any other platform can compare. Thanks to Lightspeed, I was able to expand and really grow my business,” Alissa says.

Assessing the costs of inventory management software for retail

Before we dive into the cost conversation, we want to recommend using a POS platform that has built-in inventory management software, with the ability to add integrations. This is because when all your financial and inventory information is in one place, your entire business operation is streamlined. You won’t have to worry about using multiple systems and using third-party accounts, because everything is unified in one system. Real-time tracking eliminates errors by ensuring all sales and inventory data is recorded automatically as transactions occur. 

We will assess the costs of inventory management software through this lens. It’s essential to consider several factors beyond the initial purchase price. That includes:

• Subscription fees: a POS system that includes a range of features for running your business, including inventory management software, may range from $100-$300 a month. 
• Cost of implementation and training: this depends on the provider as well as your needs as a merchant, including how many locations you own, where you sell, what you sell, how complex your inventory needs are, and more. Ultimately, it could cost between $500-$2,000.
• Hardware setup and costs: these can range from $500-$2,000 (or may be included as part of the initial purchase). Some hardware you may need to purchase for your POS and inventory needs:
  • POS terminal 
  • Receipt printer
  • Label printer
  • Handheld barcode scanners
  • Customer display screen
  • Mobile payment terminals

The ROI of better inventory management software

While an initial look at these numbers can be alarming, don’t worry. Hardware setup costs, for instance, are a one-time occurrence. It’s also important to note that greater inventory accuracy will improve your operational efficiency and increase the potential return on investment (ROI). 

Here’s why you could see improved ROI when you implement the best retail inventory software for your business: 

• The right software will help you avoid overstocking by providing real-time tracking, inventory counting tools and detailed reports on sales and stock trends. This will in turn allow you to order accurate amounts, ensuring your capital isn’t tied up in slow-moving inventory.
• Your system should equip you with advanced analytics so you can make more informed business decisions. With detailed custom reports, visibility into missed items, estimated sold and past out-of-stock periods, you can maximize your sales.
• Inventory forecasting is key to maintaining optimal stock levels, and therefore optimizing sales. Understanding future demand and trends through historical sales data creates more accurate purchasing decisions. 

The importance of reading reviews

It may go without saying, but we will anyway: do your research. Read reviews from trusted sources to gather information about how the software you’re looking into performs. Tech review sites like Nerdwallet, Software Advice and Capterra will often have detailed breakdowns of a software’s standout features and drawbacks. 

You can also check review sites that include user reviews like G2, Trustpilot and others to see what other business owners are saying. And if you want to do some field research, talking to other businesses in your area is extremely valuable. In fact, many businesses will recommend systems to others located in the same area, or deter them from using ones they’ve had poor experiences with–word of mouth is huge in the business community. 

The best inventory management software for retail

According to NerdWallet, Lightspeed Retail offers the best retail inventory management for high-volume retail stores. Nerdwallet is a personal finance company that uses a mix of proprietary and third-party data, primarily assessing consumer reviews to determine user satisfaction. 

They cite Lightspeed’s extensive, built-in inventory management features, including automated purchase orders, item bulking, barcode generator and one-click price change tool. Other equally important features for large retail stores include customized reports, automated reorder points and stock alerts, and the ability to easily sync to integrations, including accounting and planning software. 

These features combined cater to retail businesses with complex needs and high transaction volumes. If your retail business has high inventory turnover, generates significant revenue compared to competitors in your space and has multiple locations, Lightspeed’s scalable system may be the solution for you. 

Lightspeed’s retail inventory management software features

Lightspeed Retail simplifies inventory management for growing businesses. Our inventory management software gives you the ability to manage all your stock in one place. 

With Lightspeed Retail, you can: 

• Connect with suppliers: browse thousands of brands and millions of products with NuORDER by Lightspeed, a built-in supplier catalog. You can add sync items straight to your POS in a click, ensuring ultimate accuracy and time savings.
• Speed up ordering: order directly in Lightspeed with built-in purchase orders for every store and channel.
• Track inventory in real time: inventory levels and SKUs are automatically updated as transactions are processed, ensuring up-to-date information in every report. 
• Easily update prices: manage discounts and promotions, make bulk pricing changes, and use our product import tool for instant syncing. 
• Act on valuable insights: Lightspeed Insights empowers retailers with in-depth inventory tracking and demand forecasting, so you can make precise decisions to maximize your sales. 
• Create custom reports: customize your own reports and schedule them for whenever you need. Use these reports to analyze trends and forecast future demand.  
• Capture every sale: with on-point data, you can identify popular products, determine what to order and how often, and effectively prioritize reorders. 
• Avoid stockouts: never run out of bestsellers with reorder points and automatic low stock alerts. 

All these features and more–along with premium integrations–provide retailers with a scalable inventory management solution. 

Related: Check out our ultimate retailer’s guide to inventory management.

Choose the right inventory software for your retail business

Ultimately, choosing the best software for inventory management is a big decision. Your choice has a big impact on your bottom line, so take your time choosing the one that meets all (or most) of your needs. 

With this guide, you can narrow down your options to find the right one for your business. 

If you’re a retailer with plans to expand, Lightspeed Retail may be the right solution for you. Talk to one of our experts about your inventory management needs today.