What is it?
Inventory management is a crucial part of supply chain management. It means having the right amount of product ready for sale, at the right time. If done correctly, effective inventory management will reduce the cost of carrying overstocked goods. At the same time, it ensures nothing goes out of stock. Inventory management is the best way to maximize sales and it can all be done in real-time.
Inventory Management Tips and Techniques
Work on improving your forecasting. There are many factors that should go into your projected sales calculations, including historical sales figures, market trends, predicted growth, marketing efforts and current promotions. All of these factors will impact sales, so you need to take these into consideration.
First In, First Out (FIFO)
When waiting in line, the person who usually gets helped next is the person who has been waiting the longest. Apply this same thinking to your goods in inventory. The next good sold should be the item that has been in your inventory the longest. FIFO helps prevent goods from sitting around too long, which avoids goods becoming damaged or out-of-date. Selling your goods in chronological order (the order you purchase/make them in) is especially important if your selling perishable items like food, flowers or makeup. The best way to practice FIFO is to put new items in the back so the older products remain in the front.
Use a Inventory Management Software
Having an inventory management software can help you keep track of your inventory in real-time so you can avoid inaccuracies, which will save time and money. IntelliTrack Inventory is an inventory management software where you can track inventory receipt, movement, and order fulfillment with barcode scanning. IntelliTrack inventory can be accessed globally by using a secure cloud server so you can store and access all of your critical data from any location. It’s also customizable and provides fast, friendly and free tech support.
Identify low-turn stock
Some items just don’t sell as well as others. If a good hasn’t been sold in six months to a year, it’s time to stop stocking it. To get rid of that item, consider trying different strategies. For example, if a good isn’t selling, offer a discount or promotion. It is better to get rid of the item than worry about cost since the product is wasting space and capital.
Before an item gets shipped out, it is important to make sure it is looking great and working well. Have an examination check during all inventory counts. Include a checklist that ensures that no products are damaged and that they all have the correct labeling.
This method allows you to sell products without actually having to hold the inventory yourself. The manufacturer or wholesaler are the ones responsible for carrying the inventory and shipping the products when they are ready to be sold. This prevents you from having to worry about inventory holding and storage.
Learn more about how to better manage your inventory.
This blog post was based off an article by Square Up. Read the full article here.