Inventory management is a system that you build for organizing your inventory with the help of the supply chain. This covers various steps, right from the raw products to the finished goods, managing, storing, as well as selling. Inventory optimization tracks down the company’s stocked products as well as monitors the weight, amounts, dimensions, as well as location.
Inventory control is used interchangeably with inventory management. This generally refers to whenever you have total control over the stock, generally because of the effective inventory management procedures. It is simple to maintain complete control of the inventory with centralized management.
Tips to manage your inventory
Here you can find some important tips to manage the inventory for better profitability as well as cash flow management.
1. Prioritize the inventory
Categorizing the inventory in priority groups will help you to know which items that you would like to order quite often, and that is very important to the business but might move a bit slowly. The experts suggest segregating the inventory in A, B & C groups. All you’re A group items are the higher-ticket items, which you need very little. All your C group items are the lower-cost items, which turn on quickly. And your B group items are in between: these items are moderately priced & move out more slowly compared to C items but quickly than all your A items.
2. Inventory Control Personnel
The next practical tip that you will have to consider when you are managing the inventory is to hire a dedicated inventory manager. The inventory managers will be completely responsible for the business’s products, which are easily available & in transit too. Also, they specialize in performing various changes & adjustments, like the return orders. Moreover, they can assure that merchandise is received, whereas implementing the inventory reporting techniques.
3. Using Right Technology
The inventory management program is not the only technology, which will help you to manage the stock properly. Things such as mobile scanners & POS systems will help you to stay on the proper track. Whenever investing in any kind of new technology, you need to prioritize the systems, which work properly and together. Having the POS system that cannot communicate with the inventory management program is not the final thing, but it may cost you some more time for transferring data from a particular system to another, and making it simple to end with the inaccurate inventory counts.
4. Check Inventory Levels
Owning a huge amount of the inventory increases your costs as well as increases the overhead costs too. One useful tip you can follow is to determine the inventory requirements that your business needs. Try to limit the annual list as well as reduce investing lots of resources on the slow and never selling products.
5. Restocks Yourself
There are a few vendors that do inventory reorders. On this surface, this appears like a very good thing – and you save on the staff & time just by letting somebody else manage this process for some of the items. However, you need to know that the vendors do not have similar priorities that you do. They’re looking to move the items when you are looking to stock up the items, which are highly profitable for the business. Take a little time to check out inventory as well as order restocks of your items.
6. Reduce Any Shrinkage
The highly frustrating feature of inventory management will be managing an inventory that is not there. Shrinkage is the best way you can say damage, loss, breakage as well as petty theft: and reasons that white polka dot gown with size 10 is not on a shelf, although the inventory says it must be. Most of the fulfilment centres have the allowance for any kind of shrinkage.
7. Invest in Tracking System
Most of the top-ranking businesses generally have a developed tracking system, which allows them to monitor turnaround times efficiently. The inventory tracking systems generally come in variations that will range from spreadsheets and computer programs. The programs offer complete inventory control, which allows the business proprietors for managing & organizing the productivity levels as well as take counts in the stock rooms and distribution centres.