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Improve Warehouse Management In 5 Steps
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2024-03-03 |
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In many retail and other forms of businesses today, it is difficult to know what it is exactly that the customer wants and how much. Keeping track of how much inventory a business needs is a difficult task in it of itself. Forecasting helps but sooner or later there comes a time when businesses see sudden increases in product demand and the common response being: Significantly increase number of purchase orders. Businesses are constantly presented with the fear of not having enough or having too much inventory, and being able to order online only steps up that worry. To deal with this, as a thriving business, you must allow yourself to keep track of inventory in a way that allows you to control inventory, not the other way around.
Below are five steps to help balance out your inventory, increase profits while lowering cost, and be a step ahead of the competition.
1. Push Best Selling Products
Many a times we find ourselves with products that we hardly sell yet still keep in inventory. Identify the top 20% of your inventory and improve and integrate ways in which to emphasize these A¯ products. This will yield greater and profitable results to your enterprise while disposing of unnecessary inventory and reducing your costs.
2. Be Careful When you Buy
As fantastic as a product might seem, make sure you look at the risks involved. Is it the best product to sell in relation to customer's needs and wants? With any benefit comes a risk and as a business you must be able to integrate any cost/benefit analysis and have a balanced and well thought out inventory. Analyzing any possible risks that could occur in your business is an advantage that could keep you from going downhill in such a globalized economy.
3. Negotiate
Suppliers and Vendors are as important as the inventory itself. Allow yourself some time to look at what you are paying for your purchases and make sure you're getting the best deal out there. Evaluate what you're receiving from them and see the benefits and privileges you receive as a customer yourself. Look at your Cost of Goods sold, packaging time and any extras¯ you're receiving in relation to what you're paying in order not only increase efficiency but also be able to management the ins and outs of your warehouse.
4. Don't Leave ALL Inventory Behind
As sales increase it is easy to just want to order more of your top selling inventory. But remember that this is one of the main reason for overstock and decrease in profits later on. Don't just assume but investigate. During times of increases in sale, you might want to think about emphasizing the forgotten¯ inventory. Don't just let it sit there for we all know that is something we'll greatly regret in the long run. This is one of those times when good inventory management is needed the most.
5. In With The New Out With The Old Lastly, as your customers begin to lose interest with some of your products, don't encourage that. Brainstorm and implement ways in which to liquidate inventory that is not adding into your profitability and sales. The longer it sits in the warehouse, the more it'll cost your business. Don't let your top inventory take over during times of increased sales but instead use that opportunity to rid yourself of what isn't being moved.
In following these simple but powerful tips, you will see your business functioning smoothly and efficiently. |
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By: Brenda Alcala |
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