Maintaining proper inventory control will ensure your business is able to meet future sales demands without havening an excess of products in stock. What are some inventory techniques to manage your inventory?
Prioritizing your inventory, performing audits, tracking sales, and inventory management technology will all help you maintain effective control of your inventory.
Below we will take a closer look at these tips to effectively manage your inventory.
Table of Contents
1. Categorize Your Inventory
80% of your profits come from only 20% of your inventory. If you are able to prioritize your inventory you can better understand what your top moving items are and can closely manage these items. This will help you maintain the proper stocking levels for your fastest-selling items and reduce the inventory on the slower-moving stock. It will allow you to concentrate on the items that make the most money.
It is essential you perform audits on a regular basis. Some companies may perform audits on a yearly basis, while others prefer a frequent schedule. Whatever time frame you choose, auditing will ensure that the actual quantity of items in the inventory system accurately matches the product you have on hand. Auditing your inventory and keeping an accurate count will prevent you from ordering items you do not need.
3. Accurate Sales Tracking
It is essential to be able to track everyday sales and be able to use these numbers to update your inventory totals. Understanding your sales totals will also ensure you understand how items are selling and be able to form a pattern for item sales in the future. It will also help you accurately predict what future sales will be and adjust your ordering techniques to fit your sales predictions.
4. Accurate Restock Ordering
Some vendors will do the ordering of their products for you. This may seem like a convenience but in the long run, it may be a detriment to your business. The issue is that vendors may not have the same priorities that you have. They may be looking to move items while you want to restock only the needed items that are the most profitable for your business.
5. Inventory Management Technology
For very small businesses, just using a spreadsheet and notebooks to manage their inventory is achievable, but for all others, they will need some kind of inventory management technology. It will allow you to control your inventory in real-time and without the risk of it getting out of control. Be sure to understand what your business needs and that the software you choose can accurately provide what you need.
Controlling your inventory will ensure your business has the products needed for future sales. Performing audits and having inventory management technology will help your business maintain an accurate count of your inventory. Ordering the product yourself will ensure you will receive what you need when you need it. Categorizing your inventory will help you concentrate on the fastest-moving items and ensure that you maintain proper inventory levels for future sales.