One of the most difficult things for companies to do is manage inventory. It is a balancing act. You want to ensure you have enough to fill all the incoming orders, but on the flip side you don’t want there to be too much so you end up with extra inventory wallowing on the shelves.
4 tips to efficiently managing inventory
- Use prior performance to forecast future sales
- Set minimum and maximum inventory levels
- Use an inventory management technique, like FIFO
- Use one system that will provide an overview of all your inventory
Prior Performance
The first step to ensuring you have the correct amount of inventory on hand is to evaluate what you have done in the past. Evaluating which items sold quickly and which did not sell can help you plan for the future.
Min/Max Inventory Levels
There is a fine line between too much inventory and not enough. You don’t want your customers to experience “out of stock” messages, but you don’t want an excess of inventory that you can’t sell either. Setting a minimum level will allow you time to reorder stock and put it back into inventory before you run out completely. Setting a maximum level will ensure you won’t be left with surplus stock sitting in the warehouse unsold.
Use Inventory Management Technique - FIFO
Use an inventory management technique to determine which stock should sell first and which should sell last. One example is FIFO, First In First Out. Most companies can benefit from a FIFO technique. With perishable goods this will ensure that your product is sold before it expires. With clothing, this will help you have on trend styles for sale at the right time.
One System that Provides an Overview
The key to all of the above steps is having one inventory management system that is able to provide an overview of all your inventory. With one system tracking inventory related data you will be able to make informed decisions about when more stock should be ordered and how much stock should be on hand at all times.
SkuNexus is the best inventory management system for this job. Our fully customizable commerce operations platform will cull the data for you and help you have “just enough inventory” at all times.
Click here to schedule a demo and see how we can help you maintain “just enough inventory.”
