Warehouse Inventory

Inventory Management 101

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Inventory Management 101 

You may have just started a product-based business and are seeking some tips for managing your inventory. Maybe you successfully have sold products but you still feel like you have no idea what you are doing. Clearinity understands what it’s like to feel like you don’t have any control over your inventory process, that’s why we are here today to talk about the basics of inventory management.

Inventory is a vast and amorphous topic. We simply can not cover everything this topic entails in one article, that’s why we have a  whole course and resource library for those seeking more information. To get your feet wet, this article delves into the top layers of inventory management.

Because business is multidimensional, inventory management affects multiple parts of your business. By creating an inventory management process and integrating an inventory management software, you will be rewarded with more time, more money, and a clearer understanding of the health of your business.

What is Inventory Management?

In the most basic sense, it is the purchase and procurement of products as well as the practices in and around effective warehousing. Inventory management is the process by which we are able to fulfill our sales order promises.

Why Inventory Management is so important?

Your whole business relies on the relationships between your customers and your inventory processes. When your customers receive products in a timely manner and with great customer service they are more willing to purchase from you again, thus bringing in more revenue and ability to scale. Inventory management also impacts your accounting. By having an inventory management process you will be able to budget and forecast appropriately.

Who does it affect?

Quite literally everybody. It impacts our internal teams, our vendors, the customers, and the overall health of our business.

What are some inventory techniques used to create a positive process?

  • Pay attention to your SKU Architecture

    • No Leading Zeros

    • No spaces, grammatical errors

    • No random names

    • Mind your character length

  • Review Your “Pick Pack Ship” Process

    • Pick Process- Where in the warehouse does the team find your items?

    • Pack Process- How how does the team packs your products?

    • Ship Process- What are your shipping and return policies and standards?

  • Implementing Warehouse Management

    • Fulfillment- Properly managing inventory is the key to a healthy life cycle of product fulfillment, having warehouse management ensures that the product leaves the warehouse in good condition as well as allows you to assess if you can fulfill orders for that product in the near future

  • Purchase Order Tracking- Knowing what it is and how to do it

    • Product

    • Expected Quantities

    • Cost

    • Revolving parts and there is no question that this is a critical part of operations and where people struggle the most.

    • Spreadsheets are handy but you need to know what you are doing so they are effective – We offer a whole course on this!

Now that you have some techniques to approach your inventory management process let’s look at some of the most frequently asked inventory questions.

FAQS

How can I measure my inventory management success? 

 By creating KPI or Key Performance Indicators

How much does inventory management cost?

This totally depends on your company. Clearinity excels at helping identify those complexities in your business so you can effectively manage cost.

Why not just use spreadsheets forever? Why do I need a system?

Spreadsheets do not automate business controls nor are they helpful in the scaling of your business.

How do I find the right process and system? 

Let’s schedule a call!