Every business needs a continuous inflow of inventory to be able to supply products to its customers in time. And that’s where inventory management comes into play. Inventory management essentially means managing the stock of raw materials and finished goods. These are generally stored in warehouses and sent to retailers and consumers from there. Inventory management has a lot of benefits for both big and small businesses anywhere in the world. Prevents ordering excess stock Companies need to continuously track their remaining raw materials and be aware of how much more they need. This is because ordering in excess is a waste of money. Proper inventory management makes it easy to identify what raw materials need to be stocked up again and what is already in surplus, cutting down the company’s costs and saving warehouse space. Avoids stockouts Stockout is a situation wherein a certain product’s inventory has diminished, so the product is either scarcely available or unavailable for supply. Frequent stockouts can cause customer dissatisfaction, as customers look forward to buying specific products at a given time instead of waiting endlessly for the stock to arrive. Inventory management ensures warehouse managers know what products are depleting from the shelves so that they can inform manufacturers beforehand and avoid a stockout situation from arising.