Inventory tends to be the biggest balance sheet asset for businesses, so finding the right inventory management strategy is essential for boosting profits and keeping customer service levels high. Here is a look at some of the factors to consider when it comes to your inventory strategy.
Don’t underestimate the importance of having strong inventory management analysts in place. It’s crucial to consider every aspect, from pre-season planning and purchase order processing to overstock and slow-moving product liquidation. Staff must be impeccably organized in a way that allows them to manage and plan inventory tasks as effectively as possible. Don’t fall into the trap of thinking that inventory management is a clerical activity; having the right inventory availability is important enough to justify enlisting experts for the task.
If you want to make improvements, you need to look beyond the warehouse and consider the entire supply chain. Look at the vendor portals and scorecards, electronic data interchange transactions, abstract syntax notation, and invoices.
If you’re not monitoring the right metrics, you might as well not bother monitoring anything at all. Take a look at the KPIs that the most successful businesses in your industry use and ensure that you have them in place as well if you want to remain competitive.
You might also consider turning to drop-ship vendors. Right now, many direct businesses are finding themselves increasing their sales without the need to own inventory, which can help you offer a broader assortment of products without taking on a big inventory risk.
You need top-notch system support to keep everything running smoothly. This includes projecting how certain SKUs are selling and when purchase orders must be made to keep everything in stock, along with inventory on hand, exception reporting, and on-order availability by location. It’s also important for vendor management so that vendor-shipped orders can be easily monitored and tracked.
This blog post was based off of an article from Multichannel Merchant. View the original here.