Truth be told, there is no “one-stop-shop” solution for your inventory management problems. Although, applying strategic techniques may come in handy. Save your ecommerce business from experiencing any inventory nightmares in the future with these tips to improve your inventory management.
- Secure An Inventory Management Process In Place
The easiest way to improve your inventory management is through using the ABC Analysis to keep your inventory management process in place. This helps you divide your warehouse inventory into three different categories:
- Division A: Top priority items that drive the most profit to your business (raw materials, items used to create your products, etc.)
- Division B: Less-expensive or less-utilized raw materials that don’t sell as often as those within the higher-margin category; generally not as valuable as those in division A.
- Division C: Items that are worth little, but still drive your company’s success
Doing this will help you think about your physical inventory space, helping you analyze how your business may be impacted by having too much or too little of a certain item within a category.
Aside from that, having inventory tracking software in your ecommerce business helps you omit manual labor to track your inventory. While it is normal to make human mistakes, having inventory management software can help you reduce human error and even make it more seamless to track your inventory.
How Does An Inventory Tracking Software Track Your Inventory?
Your inventory management process will always start once you receive a customer order, and will continue until the order is shipped.
This process may also start in situations where you begin to forecast your demand, and create POs for components and other raw materials that you require. Some other pieces of this puzzle would be analyzing your sales trends and making sure you organize all your storage products found inside your warehouse.
So you may be asking yourself – but how does an inventory tracking software work when tracking my inventory?
One thing you should understand is that the goal of your inventory management is to analyze and understand the stock levels in your warehouse. The great thing about inventory tracking software is that it can track the entire flow of your products from your supplier, the production process of your product until it is shipped to your customer.
When it comes to your warehouse, an inventory tracking software becomes responsible for tracking your stock receipt, up to the packing and shipping of your product.
Regardless if you’re running an ecommerce site or even a brick and mortar store, an inventory management system offers you the insights that you need into every aspect of your product and even allows you to understand your customers better too.
How Do You Find The Right Management System?
If you’re planning to get a hold of a purchase inventory management for your business needs, it’s best if you start with evaluating your options from the products made available for you.
We highly recommend that you study their intended use, new and popular features, deployment type, and overall user experience so you can find the best option that helps you work smarter on your ecommerce business.
The transparency provided by inventory management software is massive and can create a big impact on your business’s bottom line. With the help of this software, you can:
- Track your goods accurately
- Minimize wastes coming from the production of your products
- Analyze trends and forecast inventory
- Make better investment decisions
- Proper Housekeeping And Warehouse Management
The key to building effective inventory management is by managing your warehouse properly. Keeping a tidy and orderly warehouse will help you avoid committing costly mistakes such as slow shipment times, and other similar errors.
Make sure you decide on a designated area for your sales orders, receiving, product shipment, and order fulfillment. Using color-coding shelves can even help you organize certain product types.
Lastly, always have a cleaning schedule for your warehouse to maintain it clean and orderly.
- Implement Supply Chain Management
When speaking of a supply chain inventory, always make sure you diligently monitor your lead time on processing your products to secure smooth business operations. Your inventory management strategies will all be put in vain if your supply chain is a mess in the first place.
As soon as you notice any problems when it comes to the shipping, receiving, and production process, be sure you reach out to your partner so you can quickly remedy the situation.
- Inventory Audits
Performing inventory audits will help you pay attention to your sales logs by helping you monitor items that are:
- Selling out
- Sitting around in your warehouse (dead stock)
Always remember that every inch of storage in your warehouse is valuable. Thus, you would only want to keep necessary products and safety stocks for your high-demand items.
When it comes to your raw materials, keep the minimum necessary amount and just order more when you think you need more of it to complete your production. This helps you cut down your costs and reduce wasting space in your warehouse.
- Setting Your Reorder Point
With the right inventory management system, you can set reorder points to automatically trigger and maintain healthy inventory levels for your ecommerce business.
Although, keep in mind that you will need to adjust your reorder points over time as customer demands can shift.
- Focus On What You Need
While managing your inventory can be a daunting task, identifying the things that you need can help you focus on things that matter. A simple example of this could be keeping your top-selling items in stock to keep your customers happy.
- Utilize Real Time Data
Getting a hold of accurate data can serve as a powerful tool for your ecommerce business. By using inventory management software, you can get the information you need right at your fingertips.
It helps you keep track of factors such as seasonality or trends that impact how fast your products move. If you notice that product turnover has decreased, you can move towards investing in a more profitable product.
Real-time data can also help your business ensure accuracy between stock quantity and financial records, thus helping you understand your stock flow and profits better. These analytics can truly make a difference for your business.
- Go Mobile
Indeed, the presence of mobile technology has brought a tremendous advantage when it comes to revolutionizing inventory management. For instance, the use of barcode scanners makes it easier to track products while eliminating unnecessary errors during the process.
Meanwhile, the use of sales apps has made it easier for sales people to track their business even when on the road. Gone are the days when tracking of data would only be possible when tethered to a computer inside a warehouse!
- Evaluate Supplier Performance
Having a bad supplier can absolutely cause chaos within your ecommerce business. Some signs that you have a bad supplier may be:
- Receiving deliveries on later dates
- Getting the wrong amount of items
With supplier audits, you can easily identify areas where your suppliers can improve. Otherwise, you may want to resort to the decision of cutting them off.
Managing relationships in any stock-based business are crucial. But, developing your relationships with your ecommerce partners is the key to a successful business. This will help create a positive impact on your supply chain resilience, making you run your business with more confidence.
Improving Your Inventory Management
With the right techniques in place along with your chosen inventory management software, you can guarantee better flows and processes for your ecommerce business.
Clearinity seeks to provide you with the right software and tools that will help you work your way towards the path of success. Our team of experts is more than happy to help you with your business struggles. We take pride in your success, as it is also our success within the ecommerce ecosystem.