Inventory management is a critical part of a company’s productivity. Not being able to administer, predict, control, and oversee inventory related issues and tasks leads to fulfillment inefficiencies, angry customers, and dissatisfied clients. It also results in high inventory management costs, extensive time loss, and employee fatigue. Managing inventory is all about achieving the sweet spot between too much and too little inventory. Regardless of the industry your business operates in, it’s important to meet customers’ expectations by holding and stocking enough products.
On the flip side, many companies go the other way, overstocking items “just in case.” Though it might seem like a safe approach to meet and exceed customer needs, there’s a high risk of bleeding excess money out of your business. Extra inventory items not only tie your cash reserves, they also incur higher maintenance costs and handling expenses.
Effective inventory administration lies someplace between these two limits. While you may want to put in some time and effort to achieve perfection in this area, the results will surely reflect your hard work.
In this blog, we’re sharing some expert inventory management tips to make inventory management easier and more rewarding for you. So let’s get started!
1. Prioritize the Inventory
Categorizing your warehouse stock into priority-level sections can help you recognize which items you need more frequently than others. It helps you categorize more delicate products from others and perform focused maintenance tasks.
Prioritize all kinds of products you have stocked at your storage facility. Understand your high-value and slow moving offerings. This will allow you to implement better sales strategies, effective pricing plans, and result-driven marketing techniques.
2. Audit the Inventory
Some businesses do a wide-ranging inventory audit on annual basis. However, we recommend you to conduct weekly, monthly, and bi-annual inventory spot-checking. This will help you make sales decisions based on hot-selling and slow time periods, thereby translating into more accurate inventory forecasts and re-stocking schedules.
3. Eliminate Piling Dead Stock
Many SMEs overstock their warehouse due to the fear of “running out of stock.” Although being cautious isn’t bad, it can lead to dead stock piling. Dead stock refers to all the items that can neither be sold, nor marked as expired.
These items have either become outdated and out-of-demand. Implementing diligent strategies such as focusing on slow/fast moving products and surveying customers every season can help avoid making this costly inventory mistake.
4. Set Inventory at Par Levels
If you want to make your inventory control system fast and error-free, set a limit for minimum product quantity that you must meet at all times. This eliminates the issue of under and over stocking and also ensures that you have all the products at all times.
By setting par levels, you’ll neither come across dead stock problems nor out-of-stock status; it will help you determine accurate inventory level. Par levels of each product depends on how fast it sells. You’ll need to monitor your customers’ buying habits and demand to realize the optimum par level. This is where a cutting-edge cloud hosted QuickBooks offering can help you make sound inventory decisions without spending significant amount of time in crunching numbers.
5. Become Tech-Savvy
Investing in inventory tracking and management software is a key step toward achieving desired results. Whether you want to stay on top of your warehouse stock levels or maintain the integrity of perishable items stored at your facility, an inventory management software can help you. These tech tools are designed to help you monitor each sale in real time.
As soon as a customer places an order, the software will notify you with existing stock level and also predict accurate inventory numbers based on customer buying patterns. Using an inventory tracking software like QuickBooks, you can:
- Identify your best-selling products
- Know the months in which your products sell faster
- Identify and target your returning and highest-value customers
QuickBooks is a convenient, affordable, and extremely efficient options for all small to mid-sized businesses looking to achieve inventory control excellence. This tool offers several robust features for inventory tracking and also integrates with other CRM and ERP programs, thereby saving a lot of time, money, and efforts.
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