Many sectors are confronted with numerous problems and flaws when it comes to supply chain management and especially inventory management. The objective of inventory management is to identify the right amount of inventory to meet demand while avoiding overstocking. A methodology for inventory management system with integrating Internet of Things (IoT) technology is proposed in this paper to monitor the conditions of a resembling inventory prototype. The construction of the proposed system was explained starting with the mechanical design of the tank and proceeding with the electrical and coding part and their assembly all together. A mobile application was developed for continuous state monitoring of the used prototype that simulates an inventory system.