Inventory Management 2023

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Inventory Management
Inventory Management

Inventory Management is the monitoring of non-capitalized assets, or inventory, and inventory items. As a component of supply chain management, inventory management oversees the flow of goods from manufacturers to warehouses and from these facilities to the point of sale.

Organizations from small to large enterprises can use inventory management to track their flow of goods. There are many inventory management techniques, and using the right one can lead to getting the right products in the right quantity, in the right place, and at the right time.

  • TradeGecko is easy to use and has plenty of integration options.
  • Odoo is easy to learn and makes it easy to track orders, but it has a poor customer support and can’t import e-commerce products directly.
  • Fishbowl is organized and easy to use, with order and sales tracking features, but you can’t import products from your online sales channel.
  • Stitch is an easy-to-use software for digital and physical stores.
  • Contalog is better for e-commerce businesses, but it makes ordefulfillmentnt more difficult.

Tips for Managing Your Inventory

Here you will find the 7 essential tips to effectively manage your inventory to increase profitability and cash management.

1. Prioritize your inventory.

Categorizing your inventory into priority groups can help you understand which items you need to order most often and which are important to your business, but may cost more and move more slowly. Experts generally suggest separating your inventory into groups A, B, and C. Group A items are more expensive items that you need less of.

Category C items are lower-cost items that convert quickly. Group B is among the moderately priced items that come out slower than C items but faster than A items.

2. Track all product information.

Be sure to keep product information records for items in your inventory. This information should include part numbers, barcodes, suppliers, countries of origin and lot numbers. You might also consider tracking the cost of each item over time to learn more about factors that may change the cost, such as shortages and seasonality.

Editor’s Note: Need help managing your business inventory? Please complete the questionnaire below to have our vendor partners contact you with information about inventory management software.

3. Check your inventory.

Some companies do a full count once a year. Others perform monthly, weekly, or even daily spot checks of their most popular items. Many do all of the above. No matter how often you do this, be sure to physically count your inventory regularly to make sure it matches what you think you have.

4. Analyze the performance of suppliers.

Your inventory may suffer if you work with a shady provider. If you have a supplier that is often late with deliveries or frequently misses an order, it’s time to take action. Discuss the problems with your supplier and find out what the problem is. Be prepared to change partners or face uncertain inventory levels and the possibility of running out of stock as a result.

5. Practice the 80/20 stock rule.

Typically, 80% of your profits come from 20% of your stocks. Focus on stock administration for this 20% of things. You must comprehend the entire sales life cycle of these products, including how much you sell in a week or month and monitor them closely. These are the items that make you the most money; don’t stop driving them.

6. Track sales.

Again, this seems like a no-brainer, but it goes beyond just adding up sales at the end of the day. You need to understand daily what items you have sold and how much and update your inventory totals. But beyond that, you will need to analyze this data. Do you know when certain items sell out or drop faster? Is it seasonal? Is there a specific day of the week that you sell certain items? Are some items almost always sold together? It is important to understand not only your total sales but also an overview of how items are sold to keep your inventory in check.

7. Order refills yourself.

Some suppliers offer to reorder stock for you. At first glance, this seems like a good thing: You save time and staff by letting someone else handle the process for at least some of your items. But keep in mind that your suppliers don’t share your priority-setting system. They want to move their items, while you want to save the most profitable items for your business. Take the time to check inventory and order the restocking of all your items yourself.

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