Starting a business that sells merchandise requires having an organized inventory to meet customer demand. As your business continues to grow, balancing that stock to align to your existing supply web capabilities is not an easy process. You have sales orders flying in and products shipping to consumers. While on the backend you have raw materials that have to also be accounted for. Without the real-time information at hand, you may end up constantly catching your business out of stock and without the customers to make your business profitable. Let us look at a few strategies that can help balance inventory numbers to match the scale of your business.
Stock Inventory Properly
Missing orders and manufacturing delays can harm your brand image. Customers will not return or wait if their request cannot be fulfilled based on their schedules. Also, customers can tell others about the dissatisfaction with these delays. This issue leads to a snowball effect where fewer customers frequent your business. The issue can also be that you have the inventory on stock, but you just do not know where it is located. The product could have also been stocked incorrectly on shelves and numbers may have been entered incorrectly into data systems.
Consider investing in automated tracking methods to know where the product is at all times. The moment the raw materials arrive, tag the items and use real-time tools to track each step in the process. These tools are connected to your network systems so they will update in real-time. This method will also give you better data for every step in the supply chain process.
Outsource Inventory to Fulfillment Centers
To counteract the issue of running out of inventory, you may end up ordering more materials than you need. Since your business is still small, all the excess inventory could take up valuable space on shelves. This problem can then lead to increased overhead and inventory management costs.
If your operations are still too small to house a lot of inventory at once to meet consumer demands, consider hiring a third-party logistics company. These organizations have the warehouse space, staff, and carrier network to store your inventory. They can also help negotiate shipping prices with carriers so your materials can take the best delivery routes at the lowest shipping costs. You can also order the product volume as you need without overstocking items that could lead to product waste and higher overhead costs.
Having misplaced products and order delays can damage your business operations and lead to bad reviews and lowered reputation. Revamp the way you want to organize your inventory and track inventory movement within your supply chain. These strategies will help deliver the right inventory numbers to meet demand without the constant threat of running out inventory or overstocking on products that customers are not interested in.
Be sure to check out the infographic below for more information and tips on keeping a balanced inventory.