Now, this is one resolution you should not only make but also keep. You’ve survived Black Friday; the Christmas rush and Boxing Day sales and you just have the January sales to contend with. Many things can go wrong for retailers during this busy peak period and the majority of issues stem from inventory control, or specifically the lack thereof.
Effective inventory control provides numerous benefits. You can start optimising inventory control post-holiday season by phasing out unwanted inventory stock, freshening up product lines and preparing for another progressive year of business.
Optimising inventory control
Optimising inventory control is not always easy but there are some simple solutions that will get you started on proactively managing inventory stock helping to reduce storage costs, inventory shrinkage and to increase picking accuracy.
- Ensure that you have accurate inventory stock information. Inventory data is the most important factor to consider, particularly if your business operates across multichannels, eCommerce sites, multiple stores and third-party marketplaces. Having a system that integrates all data from all channels into one place will provide greater visibility, helping you to determine how much stock to order based on current and historical customer trends.
- Work on reducing inventory stock levels to only what is needed in the short term. Holding too many products weakens your business by tying up working capital in underperforming assets. By keeping fewer products on hand, you can free up your capital and minimise the risk of inventory spoilage and obsolescence.
- Clean out that old and obsolete stock. It depreciates in value each month, and its presence increases potential picking errors. Consider slashing prices, recycling options or donating stock as ways to clear out old inventory to free-up space and reduce holding costs.
- For retailers using outsourced warehousing or third-party logistics providers to store and ship inventory, this information should be factored into your online inventory management to reduce the risk of errors. In addition, having this holistic view of all your inventory stock it allows you to be better informed should a customer ask about their product order or delivery status.
- If you are holding consignment stock (items that you don’t pay for until sold), it’s important to keep this stock separate from owned inventory stock. Setting up a ‘virtual warehouse’ category in your online inventory management system will allow you to store and track consigned inventory on your system without it appearing on your inventory value report. Once again, if it’s not moving, get rid of it.
- With inwards and outwards inventory movements from a variety of channels, it is important to keep track of all products in the timeliest way possible. Barcoding offers an efficient and cost-effective solution. Using an inexpensive USB barcode scanner, you can combine inventory control software with quick and easy barcode scanning to record inbound and outbound inventory stock, at the same time, reducing the number of inventory errors that can arise.
Utilise online inventory management solutions
Online inventory management software is one of the best things to happen to retail in recent years. With multichannels, multiple suppliers and vast categories, it’s crucial for you and your staff to view and manage all your inventory from one place, in real time.
Software also helps to quickly and accurately determine inventory turnover and seasonal fluctuations within given timeframes and product life cycles. This helps you to determine demand patterns and ensure product replenishment calculations are accurate and optimised.
Use automatic reorder points to maintain optimum inventory levels and avoid extremes of inventory understocking and overstocking. Employing online inventory management systems, allows you to increase efficiency and reduce waste and lost opportunities.
Don’t wait till the New Year to start!
Start and focus on cleaning up inventory now. Conduct a manual inventory count to ensure that actual stock numbers align with recorded counts. Know what you have and what you need to get rid of. Get that old stock into your ‘clearance’ sales channels to clear space, optimise order fulfilment and reduce storage costs of inventory.