Increasing competition, complex supply chains, and fluctuating demand are just a few of the issues that inventory management often faces. You’ll need to keep up with the most recent trends in the market to overcome them and flourish.
Here are some tips that can help you stay on top of inventory management.
One size does not fit all
Inventory management requires a fine balance. While not investing all of your money in inventory and warehouse space, you must maintain a sufficient amount on hand. There isn’t a single, successful method for managing inventory that works for all businesses.
What works for other people might not work for you. After all, inventory frequently brings a wide range of difficulties together. Everything from geopolitical events to technological advancements can have an impact on your supply chain and inventory.
Furthermore, you might need to handle some inventory differently than others within your own business, such as perishable versus non-perishable commodities.
Keep thorough records as you experiment with various strategies and utilise software to assist in tracking data and generating reports and dashboards to determine which strategies best suit your brand.
Understand the different kinds of inventory
Inventory is held in varying amounts and forms by various businesses. The phrase “inventory” often refers to the components, raw materials, and finished goods that your company utilizes, produces and sells.
Which four sorts of inventory are there? You should be familiar with the classifications of raw materials, semi-finished items, finished goods, and operational, maintenance, and repair supplies. All four types may be stored by manufacturers. Only the latter two may be stored at other warehouses, such as those that specialize in e-commerce.
Ensure that you know the kind of inventory you are stocking and how to handle it well.
Balance vendor and supplier relationships
Your company wouldn’t be successful without its suppliers. It’s crucial to keep up positive relationships with them. You’ll frequently need to contact your vendors for support or other factors, and their quick and favorable responses can prevent your company from going through a lot of trouble.
As you make judgments or observe patterns about your stock, inform your merchants. Inform the vendor well in advance if a promotion that potentially leads to increased inventory turnover is anticipated. Also, if there is going to be a sale, suppose in December, ensure that they know about it by July.
Treat your suppliers as important partners. Find out how they produce the products or resources you buy from them, as well as the steps they take to complete those steps. This fosters trust and gives you a better grasp of any obstacles they could face.
Be ready for surprises
Customers are fickle, and supply chains around the world are susceptible to change. When unexpected problems arise, you can adjust, thanks to contingency preparations.
Some of the common unexpected roadblocks are:
- Stock shortage
- Cash flow problems
- You run out of space
- You have purchased too much inventory
Verify the number of pallets, boxes, and storage keeping units (SKUs) the stock contains when it is received, enter this information in a warehouse management system (WMS), and then physically place the goods inside the warehouse. The variance between what your system claims you have and what you actually have on hand can be decreased by carrying out this task consistently.
That’s not all. There are more tips to come! Hop on to Part 2 and read the rest of the tips!