Inventory management is one of the most important aspects of running a business. Failure to do so effectively will often impact efficiency, sales revenue, and other aspects of your operations. The tips below shed light on ways to better manage your inventory.
1. Establish Written Inventory Processes
Just about every aspect of a business functions better when processes exist, which is the case with inventory management. Establishing processes can help to ensure everyone knows what must happen and is on the same page.
An ideal scenario is putting procedures in writing and distributing them to all team members. Your process can include a priority system that indicates which items have the highest profit margin and should receive the most attention, among other information.
2. Develop An Ordering Schedule
The time frame during which you place orders will depend on many factors. That’s why it’s helpful to establish an ordering schedule. The last thing you want to do is wait until you are out of stock, or at risk of running out of stock before placing an order for an item that’s in high demand.
Even though having an ordering schedule is self-explanatory and something that all companies understand, it’s not uncommon for a business to lose out on revenue because there wasn’t an accurate ordering schedule in place.
3. Incorporate Best Practices
Effective inventory management typically requires the use of technology. Though some small businesses manage their inventory manually, having electronic access to your inventory can change everything, especially if you have a reliable barcode generator like the one from Lightspeed. The use of a barcode system is a best practice for both large and small companies.
4. Keep Track of Product Details
In addition to the benefits previously mentioned, a barcode generator can help you track important product details. Having certain information about a product can help you make better buying decisions. For instance, it allows you to more quickly ascertain the demand for a product so that you know what to order now and during other seasons.
5. Conduct Regular Inventory Audits
A relatively easy way to improve the management of your inventory is by conducting regular audits. Auditing can be a simple process that occurs weekly, monthly, or across a different time frame that fits the needs of your business. The primary goal of an audit is to ensure the information in your system matches what physically exists. An audit is also a way to assess whether you have an issue with inventory shrinkage.
6. Identify What’s Selling
There is a well-known 80/20 rule called the Pareto Principle. It’s a principle that’s applied to many aspects of life. The simplified version is that 20% of your efforts produce 80% of your results. This rule applies to inventory management. It’s believed that 20% of inventory generates 80% of profits. That’s why it’s critically important to identify what’s selling.
While all of the tips provided are beneficial, getting a barcode generator should be a priority. Why? Because it can have a significant impact on your bottom line results.
