No matter the size of your business, it is important to manage the inventory that you hold. Poor inventory management can be disastrous for any business. If you struggle to get in control of inventory and inventory management, you could face increased costs and delays within your supply chain.
Establish Your Starting Point
To manage inventory, you need to know what figures you are dealing with. You need to know what stock you have and where it is kept. Understanding what inventory you have is essential, as this will act as your starting point. When you have a clear starting point, you can be sure that you are not overlooking inventory or overlooking how it is managed.
Track in Real Time
You need to know exactly what is happening with your inventory, and to make sure this happens; you need to track it in real-time. This means you need real-time data through real-time software. Inventory management cannot be effective if you are looking at figures that are days (or weeks old). Linking all of your inventory and getting set up with appropriate software may feel daunting, but you must see the positives about real-time tracking. For example, it can help you cut back on costs. With real-time data, you know what inventory you have sitting on the shelves, and you know what is costing you money to keep.
Reach Out to Other Providers
Managing any volume of inventory by yourself can, at times, be overwhelming – especially if you are focusing on running other areas of a business. It may therefore be beneficial to reach out to third-party providers. Those that specialize in offering inventory support and management. To build the best relationship with a 3PL provider, you need to be clear about what you need and want. For example, do you need support correlating your data? Do you need to look at more effective ways to manage inventory in real-time?
Audits are Essential.
Even though you are actively managing inventory, you will find that audits are a key step you must follow. Audits allow you to see just what inventory you have and why you have a surplus or shortfall. Daily inventory management can focus on one or two lines, and sometimes other lines and areas can get overlooked – this is where audits come into play. Audits that are carried out annually will allow you to account for every item of inventory your business holds. They will also help you see if you are managing inventory as effectively as possible.
Review Your Approach
When you are managing inventory within your business, it is important to realize that change needs to happen. As your business grows and evolves, you will need to review the approach you take to inventory management. If you are not reviewing your approach regularly – on a quarterly or six-monthly basis- you will work towards outdated practices. When you review your approach, you can establish what is working for your business and what can be improved or changed completely.