Wise management of a business’ inventory is important now more than ever. It is unfortunate that most of the world is now under a crisis due to the global pandemic, but the retail industry can take this as an opportunity not only to boost their profit but also to help people survive and cope with the ongoing circumstances.
It is vital that selling of goods will continue especially the daily necessities. For businesses like these or selling complimentary items related to these, the ever-complicated inventory management has become even more challenging. But this doesn’t mean it is impossible. Even during these tough times, businesses can still fulfill their customers’ needs. Here are some effective inventory management tips not only to keep the business going but also to increase profitability and cash flow management.
1. Keep Track of Product Data.
No one else should be more knowledgeable about the product information for items in a business’ inventory more than those who manage it. Aside from basic information such as SKUs, suppliers, and countries of origin, the cost of each item including the materials being used to make them should also be monitored as these will be factors on price changes in the future.
2. Practice Inventory Auditing.
Having over supply and under supply of inventory can cost a business unnecessarily high amounts of money. One way to prevent these is by doing a comprehensive count as often as possible. Physically counting the inventory of a business remains as one the best approaches in determining whether the actual numbers match what you think you have. But due to the ongoing crisis, it is understandable if this cannot be done more often.
3. Check Supplier Performance.
Problems with the supplier can mess up the inventory of a business pretty badly. So, it is crucial that issues with them are regularly discussed to know what the problem really is. Just in case, business owners and managers also have to prepared anytime to switch partners, or deal with stock issues resulting to low inventory levels.
4. Make Some Inventory Management Technology Investments.
For small business, using spreadsheets and notebooks in doing some basic inventory management tasks can be possible. But as the business grows, it becomes more demanding in terms of time and manpower. This puts the stock at risk of getting out of control. At this point, one can find a good inventory management software useful to do the work easier. But before choosing what software solution to use, one must first carefully take note and understand the needs of his/her business to make sure the software is easy to use and to know if it provides the analytics important to the business.
5. Use technology wisely.
Aside from an inventory management software, there are also other types of technology that can help a business manage stock. Mobile scanners and POS systems for example, can be integrated with an inventory management software to avoid errors and ensure accuracy of inventory counts.