Many business owners have described their inventory as one of the most challenging elements in their businesses. In fact, statistics show that 75% of all supply chain professionals feel like their inventory management can be improved upon. 48% say that they can actually re-evaluate even their warehouse location, while others state that their strategies are just simply outdated.
So, what can you do to improve inventory management for your company? What are other companies doing to modernize theirs, and how can you take yours into the next generation? We took a look at some of the top ways that you can update and modernize your inventory management in your business and how you can make it a success.
Automate as Much as You Can
The first thing that you can look at is bringing in tools and platforms to help you streamline the processes. In many cases, it is simply a case of researching the tools and platforms and finding the right ones for your needs. Typically, you have a few options to choose from, and you simply need to match the ideal one to your needs based on your size and budget.
For example, if you are running a fashion business, consider an apparel ERP tool to streamline your inventory management. These platforms come with multiple features to help you successfully manage your inventory.
They help you with the manufacturing process and assist you in fulfilling orders with software developed specifically for apparel and accessories. You are also able to consolidate all of your products, inventory, and multi-channel sales in one centralized place. It also helps with accurate forecasting based on past data.
Audit Your Inventory
Many companies simply do not do this enough, but an audit is the best way of getting everything back to basics and getting a firm grip on what’s really going on behind the scenes. Audits are important to check your company’s actual inventory levels against your financial record. You can either conduct them by yourself, or you can get a third-party auditor to do it for you.
They are really useful in ensuring that you have accurate numbers, but they can also act as an early warning system to let you know if there are any problems with your inventory storage and accounting methods. There are a number of different types of auditing methods, so take your unique needs into consideration while choosing the one that best suits you.
Overhaul Your Inventory Receiving Methods
You want your receiving of goods and products to be as streamlined as possible. If you are not correctly receiving, checking in, shelving, and displaying your stock, you will battle with the rest of the supply chain. Stock check-in needs to be accurate, as errors that occur in this phase will directly impact the rest of your product line and can lead to over-ordering, false backorders, and unsold stock. And all of this can have a negative impact on your bottom line.
One of the most popular ways to receive stock is against your purchase order. It is important that you open and checks all cases and containers as soon as you receive them and make sure everything is correct. Many companies make the mistake of relying on labels and supplier packaging. The problem is that these can contain errors, and suppliers can make mistakes. Once you have signed for it, you usually cannot get the error fixed.
From there, it should be quickly shelved in its assigned space. Companies usually use methods such as “last in, first out” (LIFO) or “first in, first out” (FIFO). The most popular is usually the FIFO method, which ensures that older stock is sold first. This is especially important with perishable goods with expiration dates, such as cosmetics.
Track and Trace Everything
As soon as you receive stock, you will need to keep a record of it. You will need to know exactly where it is being stored and how to get to it quickly when you need it. All of these processes can be done with the right tools. Whether you are electronically tracking everything or whether you are still keeping manual records, your supply chain map is one of your most important assets.
From reducing loss and costly mistakes and fraud to improving fulfillment time, correct tagging and record keeping can save your company considerable money. In the long run, it will also help with audits, improve transparency and create a seamless inventory management system.
The Bottom Line
The bottom line of inventory management is simply to remain as organized as possible. From ordering your inventory all the way to fulfilling orders, keep records of absolutely everything. There are some great products, and the ROI of these is usually really high.