4 Inventory Management Techniques Your Business Needs to Implement

In order to survive in today’s ultra-competitive retail landscape; you need to ensure that all your processes are as optimized and efficient as possible. As a small business, inventory techniques usually take a manual form but in light of fluctuating demands, unexpected marketing trends, and scalability issues associated with growth, you’ll need to do some serious thinking if you want to avoid sustaining financial loses. Studies reveal that around 46% of all small businesses don’t have any inventory management controls at all!

In this article, we take a look at 4 of the best inventory management techniques that’ll increase your business efficiency and help save up on considerable costs.

Bundling

Accurately forecasting what to order is an extremely difficult task in the absence of effective inventory management techniques such as retail reporting. Despite taking each possible precaution, you might still end up over-purchasing an item. Fortunately, a technique known as bundling helps counteract such problems.

Bundling is a strategy commonly used by brands looking to upsell customers on specific sales. It is also used as a promotional move to quickly sell aging inventory. Examples include bundling items at reduced costs that make it appear ideal in the consumers’ eyes. This is beneficial for both parties as the customer is getting a better deal while you are able to move aging inventory by upselling.

Another example is adding aging items as surprise gifts. You can disguise it as a free item which allows you to move aging inventory based on future demand. This makes it seem like an exclusive offer and makes the customer feel special.

FIFO

First-in, First-out, or FIFO for short, is an important inventory management technique as it ensures the oldest stock gets sold first. Older products can get dusty and worn out, making them unappealing to the customer and reduces the probability of sale. This technique is particularly effective in saving perishable items that become un-sellable after a certain period of time.

Bulk Shipments

If your forecasting game is on point, bulk shipping evergreen items are great for your brand.  Once you determine the right product, it’s time to place the orders. Although you may have to invest significant amounts at the beginning, you’ll soon get a fast ROI based on the product’s high demand.

3PL and Vendor Auditing

3PLs and vendors that have a policy of recruiting a high number of temporary employees fall victim to an increasing quantity of missing and lost inventory due to an ever-present need to train inexperienced employees. Crosschecking the inventory with the 3PL’s or Vendors help keep your inventory accountable.

Implementing effective inventory management techniques serve as easy and inexpensive ways of increasing efficiency. Combining it with an inventory management software takes it to the next level and grants you access to high levels of control and visibility. We offer inventory software for manufacturing companies that help transform streamline and automate your inventory processes. Contact us today for more information.