Inventory Management In Excel: Optimizing Stock Levels

Inventory Management In Excel: Optimizing Stock Levels

Inventory Management is keeping track of a company product and documentation. Inventory management in Excel plays a game-changer for the business organization. With powerful formulas, Excel organizes the inventory like never before. 

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Why is Inventory Management in Excel Necessary?

Employees who handle the inventory ensure there should be enough stock for the customer to buy, but not too much that it just sits around collecting dust. It keeps an eye on what is coming and going out so you know when to order more and when to stop. Inventory management is an organizer of the company who makes sure that everything runs smoothly and customers always find what they need.

Inventory Management In Excel

It also minimizes the cost of holding, reduces the risk of a stock, and increases the organization’s efficiency. 

Inventory Management In Excel Sheets

Inventory management in Excel is the best solution if you own a company and need help finding out how to manage your inventory. It is a program that almost everyone is familiar with. With the integrated tools, features, and Excel formulas, you make the system more dynamic and interactive. 

How Do You Set Up Your Inventory Management in Excel?

A basic template should include product number, product name, item description, item price, item cost, value, quantity to reorder quantity sold, and if you want to update sales quantity or value. 

You can also make another inventory regarding the time to reorder, total inventory value, and other functions, which are also helpful. 

How to Create An Inventory List In Microsoft Excel?

The guide to Creating an inventory list in Microsoft Excel is as follows:

  1. Click on the New tab on the left menu. You will see plenty of options out there. Choose them. 
  2. Click the search Bar. It’s at the top of the Excel New tab under the Black Workbook button. Type the online template according to you. 
  3. Search for the Inventory List template. To do so:
  • Type inventory in the search bar at the top of the page
  • Press Enter. This will bring templates for inventory management.
  1. Select a template. Click the inventory template that best suits your needs. Its preview page will open.
  • Each inventory list template offers different features. If you don’t like the selected template, press Esc to return to the templates page.

Lastly, Click Create. It’s to the right of the template’s preview window.

Wait for your template to load. This may take a few seconds. Once the template is open, you can proceed.

Enter your inventory information: Enter your item’s information. While your selected template, every inventory list should include the following options:

  • Item Number – An item’s inventory number.
  • Item Name – An item’s descriptive name.
  • Item Cost – The cost of one item.
  • Number in Stock – The item quantities in your inventory.
  • Net Value – Item’s stock total value

You can add a picture of each inventory item in Excel. To add images:

  • In the insert tab, select Illustrations, then Pictures, and then click on This Device.
  • Click the image file and then click Insert.
  • Right-click the image and choose Format Picture.
  • Click the Size & Properties tab button and the Properties drop-down, then select Move and Size with cells.
  • Adjust the row and width for your image column to fit the image.

After having a detailed explanation of how to use inventory, Let’s move on to the part where we learn how a user can use Excel at an advanced level. To do it on a higher level, one should know how to use Excel Formulas. 

This was a short Excel inventory management tutorial. 

Inventory management Excel Formulas

Some of the most useful formulas for inventory management in Excel are as follows:

  • Sum:

 As the name suggests, it sums up the two numbers entered into the cell and makes your task more easy and quick. 

SUM:=SUM(VALUE:VALUE)

  • SUMIF:

SUMIF is the same as the Sum function, but the difference is that it is applied to specific criteria. Suppose you want the total value of the customer to have a price greater than 100. This function will show the full value of the cost greater than 100. 

SUMIF:=SUMIF(RANGE,CRITERIA,[sum_range])

Inventory Management In Excel

  • SUMPRODUCT:

SUMPRODUCT is the formula used to perform addition, subtraction, multiplication, division, or product for a given range. 

SUMPRODUCT=SUMPRODUCT(RANGE1,RANGE2)/SELECT CELL

Inventory Management In Excel

  • SPLIT FORMULA:

 Though split formula is not a Built-in function in Excel, its quite useful in inventory management. The “Text to Columns” features can split cell content into multiple columns. You can use formulas like “Left,” “Right,” and “Mid” or a combination of functions like “Find,” Substitute,” and “Len” to split the Text.

Inventory Management In Excel

  • Incoming Stock Formula:

INCOMING STOCK:=SUMIF(INCOMINGS[PRODUCT CODE];[@[PRODUCT COE]];INCOMINGS[QUANTITY])

This formula is used to count your incoming stock. This formula helps to track your inventory accurately. 

  • Outgoing Stock Formula:

Outgoing Stock:=SUMPRODUCT1

It is used to calculate the amount of inventory sold and shipped. You can avoid the risk of outselling stocks and maintain reliable data. 

  • Stock Level Formula:

Stock Level: =[@[INITIAL STOCK]]+[@INCOMINGS]=[@OUTGOINGS]

As the name suggests, it is the data regarding the current stock level. You can combine the best Excel formula for initial, incoming, and outgoing stock. Overall, it will help make an informed decision regarding reordering and stock management.

  • Merge

Merge refers to combining the cell or data. But it is not a specific formula. Excel used CONCATENATE, CONCAT, and TEXTJOIN to get into the more exact formula to merge the string or numbers. 

  • VLOOKUP formula:

VLOOKUP(LOOKUP_VALUE,TABLE_ARRAY,COL_UNDEX_NUM, [RANGE_LOOKUP])

The VLOOKUP formula is valuable when finding data in a table or range based on a specific value. It allows you to link and combine data from different sources, making it helpful in calculating the total value of an order or associating products with relevant information.

Inventory Management In Excel

  • Index and Match formula:

INDEX and MATCH: =INDEX(Profit column,MATCH(Lookup Value,Product Name column,0))

The INDEX and MATCH formulas pull values from a table using a given condition. Unlike the VLOOKUP formula, which only goes left to right, the INDEX and MATCH formulas are more flexible, seeing that the data to be pulled could be in any part of your spreadsheet.

  • Left or Right Formula:

LEFT or RIGHT: =LEFT(SELECT CELL,NUMBER); =RIGHT(SELECT CELL,NUMBER)

The left and right formulas are used to extract characters from a cell. The LEFT formula receives a character from the beginning and the exemplary extract character from the end of the cell. This is used to separate certain parts of a cell’s content.

  • Rank Formula:

RANK: =RANK(SELECT CELL, RANGE_TO_RANK_AGAINST, [ORDER])

As the name suggests, the rank formula ranks your values in the list according to the relative position. You can give ascending and descending, making it valuable for identifying the best-selling product from the list and prioritizing your inventory needs.

  • AVERAGEIF FORMULA:

AVERAGEIF: =AVERAGEIF(SELECT CELL, CRITERIA, [AVERAGE_RANGE])

It is used to calculate the average of the cell with the specific condition attached to it.

The AVERAGEIF formula is used to analyze trends and determine the average performance of the product baes on the defined criteria.

  • CONCATENATE formula:

CONCATENATE: =CONCATENATE(SELECT CELLS YOU WANT TO COMBINE)

The CONCATENATE formula combines multiple values such as text, numbers, or dates into a single cell. It is generally used for creating stock-keeping units from different cells.

Inventory Management In Excel

  • VALUE Formula:

VALUE: =VALUE(“text”)

Convert text representation into the actual numeric value. But is it necessary? Yes, it is essential that if you want to perform any calculation related to that data, it will help you do so.

  • Replace Formula:

REPLACE(old_text, start_num, num_chars, new_text)

The built-in function in Excel allows you to replace a specific portion of the text with the new text. If you want to change a particular character in the spelling, you can easily do this through the replace function.

  • Min and Maxif Function: 

MINIF and MAXIF: =MINIFS(RANGE1, CRITERIA1, RANGE2); =MAXIFS(RANGE1, CRITERIA1, RANGE2)

The simplest and easiest function that will quickly display your result of a search for min and max values in your inventory Excel. This is usually used to search for the highest and lowest sales and prices of the product.

Inventory Management In Excel

Inventory Management in Excel: Workshop For Excel beginners to Advanced level

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  • Create a detailed inventory management report with Microsoft Excel through office Master. 
  • Learn Advanced to beginner-level skills in Excel through Office Master.

If you are a beginner and want to learn inventory management for your company or startup, you can join this course and become a top 1% Excel user. IIT Kharagpur alumni organize the workshop, promising to increase efficiency and uplift your career. Within 3 hours, you will learn practical concepts to become a top Excel user. 

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