Managing inventory is inherently challenging, especially when a business scales or is in the midst of a busy season when demand peaks. If you own or manage a business, you need inventory management strategies to ensure you always have enough inventory, meet demand, and operate in as efficiently as possible. Let’s take a look at some of the top inventory management strategies industry leaders use to stay at the top of their field.
Do Not Over or Under Stock
The cardinal sin of business is to leave money on the table due to a lack of inventory. Your business should never be in a position where there is insufficient supply to meet demand. This is precisely why your inventory management strategies should be highlighted by prudent stocking that ultimately ensures you do not end up with insufficient or an excessiveamount of inventory. The problem with too much stock is it sinks capital into inventory that could otherwise be used for other business purposes such as hiring more employees, raising employee compensation, making processes more efficient, developing new products, or even acquiring another business.
Connect Inventory Systems
Your inventory systems should be interconnected as deeply as possible so information can flow in a seamless manner. These systems should track the supply of inventory as well as the movement of products throughout the organization all the way from the point of acquisition/production to the point of sale. If your inventory systems operate independently from one another, you must begin to invest the time and effort necessary to link them together so you can easily track inventory location at all times, ultimately ramping up operational efficiency.
Keep Adjustment Codes Consistent Across Inventory Pools
When it comes to inventory management, uniformity is the name of the game. Each of your inventory pools should have consistent adjustment codes across the board. Otherwise, your team will become confused as to why some inventory has certain codes while other inventory has contrasting codes. This confusion will stifle workplace efficiency and possibly even delay the movement of products from inventory to the point of sale. Such delays ultimately reduce customer retention, making it that much more challenging for your business to remain in the black.
Don’t Allow Short Shipment Holds to Slow Down Your Processes
There is the potential for abbreviated shipment holds to stifle internal processes. Slowed processes end up delaying product deliveries. Such delays will inevitably send customers to the competition, taking a chunk out of your bottom line. Address those short shipment holds head-on with the overarching aim of expediting internal processes and you will find your customer retention rate climbs even higher.
Mind the Time to Fulfillment
Optimal inventory control ensures the time necessary to fulfill customer orders is as short as possible. An inventory management system must be used to study product sales so you know which items are particularly popular. These in-demand items should be always in stock, guaranteeing you can fulfill customer orders as necessary. Make the mistake of lacking inventory and your time to fulfillment will stretch out longer than it should, alienating customers and damaging your reputation.
Take Note of Seasonal Demand
Demand for your products might not be consistent throughout the entirety of the year. Though certain products are likely to sell better than others, some of your inventory will sell more briskly during specific times of the year. Anticipate seasonal demand ahead of time and stock your inventory accordingly. If there is insufficient inventory available to meet seasonal demand, your business will be viewed as uncaring and unresponsive to customer needs. Keep in mind, there might only be one or a couple of alternative options during the peak season, so it is imperative you have enough stock on-hand to please all of your customers. Otherwise, they will either pivot towards one of your competitors or simply refuse to do business with you across posterity.
Minimize Lead Times
Lead time is the amount of time necessary to fulfill customer orders. Lead times are one of the primary factors that shape customer satisfaction or dissatisfaction. Customers prefer suppliers who meet orders in as little time as possible, have short lead times and respond in a timely manner to customer needs. If a unique item or if additional inventory is desired by the client, that need should be met in a timely manner. When in doubt, take advantage of inventory management software to ensure inventory is ordered in a timely manner in response to customer orders and ultimately minimize lead times.
Heighten the Accuracy of Purchasing and Procurement
Today’s inventory management systems help expedite and organize product inflow and outflow. These systems also facilitate the management of supplier networks. However, there are some limitations. In some cases, buyers of inventory must export data to Excel spreadsheets to run order calculations. The end result is an unnecessary delay along with a heightened ordering process variable err rate. Consider adding an intelligent purchasing system that makes it easier to manage your organization’s purchasing accuracy and demand forecasting. Ideally, this system will seamlessly integrate into your company’s primary management system for optimal efficiency.
Plastic Pallet Pros Is at Your Service
Our team is here to help you manage your inventory and logistics with the utmost efficiency. We have pallet solutions for all applications. Examples of our products include nestable pallets, economical pallets, rackable pallets, and bulk bins. Contact us today to find out more about how we can help your business. You can reach us by dialing 1-877-651-7816 or by filling out our convenient online contact form.