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July 26, 2022
Top 5 Tips for Inventory Management for your Local Business
Effective management of a business’s inventory is a top priority for any company—whether it be eCommerce, retail, or wholesale.
Getting your inventory functioning like a well-oiled machine is vital whether you’re an established firm attempting to survive in a competitive market or a start-up looking to hit the ground running.
Mastering the way you handle your inventory, from placing orders to shipping and tracking, may propel your company from 2000 to 2022.
What are the advantages? Increased productivity, better space use, and stock management efficiency.
Oftentimes it proves to be challenging since the financial performance of a corporation is dependent on precise and effective inventory management. Discrepancies caused by human mistakes or inventory theft will negatively impact growth and profit, especially if you operate a small business.
It’s one of the main reasons why small businesses struggle to have enough stock on hand at the proper moment without overstocking or understocking the most popular items.
Furthermore, conducting obsolete inventory management techniques manually consumes your staff’s working hours thereby reducing efficiency.
As a result, small firms must have an inventory management system that is inventive, updated, and automated.
In this blog we will discuss some great tips for inventory management for small business. Read on to see and implement these tips for your business today.
Tips for Inventory Management
Here are our top tips for inventory management that you can easily implement into your business processes to help ensure you streamline your operations and have a system in place that works efficiently.
1. Regularly Schedule Stock Audit
Regular stock audits are essential for effective inventory management. Many organizations conduct a full audit once a year to see whether their current inventory matches the digital count. Some perform more frequent checks to better monitor fast-moving commodities.
In both cases, manual stock counts are the most effective technique to identify expensive mistakes such as staff theft and mislabeling. You are also quite likely to find obsolete, stolen, or damaged products that would have been otherwise missed. This is especially important if your products have a shelf life.
Consequently, small businesses should undertake stock inspections on a regular basis to prevent costly oversights in their inventory management later on.
If your cloud inventory management system experiences a fault, you’ll be able to detect problems quickly and rectify them if you already have a good understanding of how to manage inventory manually.
2. Prioritize Your Inventory
Organizing your inventory into priority categories will help you understand which goods you need to order more of and how frequently, and which are crucial to your bottom line even if they are more expensive and move slowly.
ABC analysis is an excellent place to start when categorizing and prioritizing your inventory items.
A: Your category A goods are a major priority for your company. Consider A products to be the ones that provide the most profit, either directly or indirectly. These also comprise the raw materials which are required for the manufacture of your products that you cannot run short of at any time.
B: These items are not as valuable as your A items, but they are still vital. These might include less expensive or less-utilized raw materials, as well as commodities that don’t sell as frequently or with as large a profit. You’ll probably want to keep some B goods on hand.
C: The C goods are worth relatively little, yet they are important to the success of your company. These inventory items might be finished goods or low-cost raw resources. You’ll most certainly have a lot of C goods, despite their low real value.
3. Standardize Your Processes
Many firms learn their best practises via trial and error over a long period of time.
For smaller businesses, which may have less experience in drawing out business processes, it might be prudent to consider what type of structure could work best for your company.
Take into account your available space, employees, work environment, and current demand. Avoid doing tasks simply at the last minute or when needed—but have a solid plan of action in place for all your inventory and warehouse management needs. You never know when your orders may start multiplying in size which can leave you and your employees unprepared and overwhelmed.
While you will most likely discover new processes in the future, consider standardizing the fundamental operations of your business operations early on to save you time in the long run.
4. Pay Attention to Supply Chain Management
Tips for inventory management alone cannot guarantee success for your business without proper supply chain management as well.
Supply chain management caters optimizing your business’s relationships with material providers, shipping partners, and any other parties involved in the lifespan of your inventory.
An unreliable supplier might disrupt your inventory. If your supplier is consistently late with deliveries or consistently under-delivers, it’s time to take action. Pay attention to the lead time between when you place an order or initiate a procedure with any of your supply chain partners and when the activity is completed.
If you find a bottleneck in your shipping, receiving, or manufacturing process, make sure to identify which supplier is responsible. Bring up these the concerns with your provider and determine the source of the problem.
Prepare to find other partners or cope with unknown supply levels and the risk of running out of stock.
5. Invest in Inventory Management Software
Perhaps the most important aspect of handling your inventory effectively is to invest in inventory management software.
Technological advancements have made it possible to now simply control all inventory movements through a single system with minimal human input.
This accelerates your management operations while also generating reliable data. Inventory control software is essential in achieving peak performance.
The first step is to thoroughly examine the software platforms that are most suited to your company’s demands.
With so many recent advancements in cloud computing, you may now have access to cutting-edge software for a low subscription charge. Begin by conducting preliminary research so that you may realise the benefits of a robust inventory management system earlier on.
The ideal software platform should offer the following inventory management services:
Keep track of your inventory. You can quickly determine how much stock you have, which goods are selling quickly, and when your next shipment is due.
Analyze sales to correctly predict demand.
Prepare and plan material requirements.
Maintain an adequate supply of inventory to fulfil demand.
Remove any dead stock.
Create inventory analysis reports.
Streamline warehouse processes.
Effectively manage cash flow
Inventory management software isn’t the only technology that helps you with stock management. Mobile scanners and POS systems can assist you in staying on schedule. Choose systems that are easily integratable.
It may cost you extra time to transfer data from one software to another if your different technologies cannot function, making it easy to wind up with errors and inaccuracies.
Manage Your Business with Xoopah
Xoopah is a one-stop shop for small company management, with features ranging from contact management to payment processing to financial tracking and reporting. You can streamline your operations and free up time to focus on what you do best: operating your business using Xoopah.
Small enterprises, we think at Xoopah, are the backbone of any economy. Small companies have a big influence on the economy, from creating the most employment to driving innovation.
Xoopah arose from a goal to assist small companies in growing by making them more discoverable, accessible, and allowing them to keep clients for life.
We accomplish this by offering small company owners with simple and smart growth tools that help them expedite customer interactions, organize connections, respond to reviews, and get paid on time, giving them ultimate control over their business.
If you wish to find out more about the wonderful features that Xoopah has to offer, as well as how Xoopah all-in-one platform can aid your business to run smoothly and allow you to streamline and make your processes efficient check out our website today.
You can also book a demo with one of our team members and discuss your business needs and see exactly how the platform can help you manage your business as well as get any of your questions answered.
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