Did you know that 43 percent of small businesses in the United States don’t track their inventory? Firms that don’t track inventories run into forecasting problems and unexpected stockouts.
The adversities of poor inventory management go beyond cost controls. It also affects customer relations and productivity.
Proper inventory management can help you identify slow-moving products. It also frees cash to invest in new products or other important business operations. Although effective supply chain management is valuable, few b2b brands know how to do it.
Here are the top inventory management strategies.
Automate Inventory Management Process
The supply management process for shipping companies can be complex. The organizations handle high volumes of goods moving in and out of the warehouses. Managing the inventories manually is almost impossible.
Fortunately, there are many inventory management software packages in the market.
The systems allow for effective automation of inventory management activities. You can customize the software to match your warehouse organization.
Just-in-time inventory management implies handling stock in a more disciplined way. The inventory approach targets minimum inventory that meets demand. This would reduce your storage costs and overstocking liabilities.
A Just-in-time system requires close collaboration between shipping companies and suppliers.
The risk of this supply chain tip is the lack of stock to fall back on in case of a rapid surge in demand. However, if you have a good relationship with the suppliers, you can easily address the problem.
Use Data Analytics to Optimize Inventory Management
If your inventory management uses a software system, maximize on data analytics. The management system provides real-time data. Data analytics tools convert raw data to valuable information.
You can apply data analytics to predict market demand and sales forecasts. Analytics also reviews your inventory management performance. This can help you scale up or down inventory at the right time.
Making business decisions from the point of knowledge protects you from costly mistakes.
Consolidate Distribution Networks
If your shipping company has several distribution centers, it’s important to consolidate the operations. Using inventory management software, a company can identify underperforming distribution centers. This will determine which locations to eliminate or consolidate.
Centralization among networks allows for product movement through the network.
You need to keep track of your networks and ensure effective collaboration. Through information sharing, this collaboration is achievable.
Regularly Perform Audits
Regular audits are necessary to maintain inventory accuracy. Your audits should verify the amount of inventor, its quality, and its condition.
The goal is to ensure the value of the inventory is accurately represented in the financial statement.
Optimize Your Inventory Management
Better inventory management strategies position your company for success. It protects your firm from costly mistakes of poor inventory management.
Implement the above supply chain tips to take your inventory management to the next level.
All companies need to control their stock and how it moves. The process is not always as straightforward. Contact us to learn how you can achieve your inventory management goals.