Improving inventory management for small businesses can be a difficult venture due to the costs it can bring, and the sheer amount of choices available. Follow our top tips below for improving inventory management in a small business:
8. Build a relationship with your suppliers
Whether you’re an established business trying to thrive in a competitive industry, or a start-up wanting to hit the ground running, getting your inventory running like a well oiled machine is essential. From placing orders to shipping and tracking, mastering the way you manage your inventory can take your business from the year 2000 to 2021. The benefits? Increased productivity, improved use of space, and efficient use of stock.
1. Choose your software carefully
The first step is carefully researching the software platforms most suited for your business needs. Explore different review sites that cater specifically for different types of software: Capterra, WebRetailer and Software Advice are a good place to start.
With so many recent developments in the cloud computing industry, you can have access to cutting-edge software for a reasonable monthly fee. Our cloud inventory management software helps small businesses and start-ups alike to check stock levels in real-time, enabling them to see how much stock is available to be sold, and how much more they need to order.
Start off by doing your research early, so you can reap the benefits of a robust inventory management system as soon as possible.
2. Get to know your inventory
When managing your inventory it’s essential your business has access to key bits of information, at any given time. If if you can’t easily (and accurately) find the answers to these questions, it might be time to get your ducks in a row.
- How much of X do you have in stock?
- How much of X has been sold in the last Y months?
- How much is of X is reserved for customers?
- How much of X do I need to order?
- What’s my best seller?
Knowing your stock, is understanding your business. Having a system in place that gives you access to all these key bits of information also means you can start drawing comparisons and making informed reports on a monthly to yearly basis.
3. Streamline your work
If you haven’t already, stop to consider how you prioritise workloads, how you store documentation, and how you deal with different scenarios at work (for example, your busiest seasons). Having guidelines in place for all these different aspects of running a business go hand in hand with creating more streamline processes.
Having a resolution or process in place for the different scenarios you’re likely to encounter at work will save time, encourage good practices, and as a result – increase efficiency. If you’re unsure of where to start, get in touch, or make use of our very own Eisenhower Matrix.
4. Undergo manual stock counts
Whether your business has invested in an inventory management system or not, undertaking regular manual stock counts to reconfirm the stock you have is important – particularly important if your products have a shelf life.
Whilst it seems like a tedious job, you’re highly likely to come across any obsolete, stolen or damaged stock. It also means that in the unlikely event of a glitch in your cloud inventory management system, you’ll be able to quickly identify and resolve it.
5. Make use of drop shipping
Drop shipping businesses can be run from anywhere that has internet connection, because your products are sent directly from the manufacturer to the retailer or customer. Whereas traditional businesses need to store their stock in a warehouse; drop shipping businesses don’t need to buy or rent any extra space, significantly reducing overhead costs.
Location is an area where you can really cut costs with your inventory, because realistically, all you need is a laptop and a phone. Combine this and an inventory management system that supports drop shipping, and you can access any stock from around the world.
6. Create standardized processes
Many businesses identify their best practices through trial and error over a period of time. For those with less experience in mapping out business processes, put some time aside to think through what kind of structure might work best for your business. Consider your space, staff, environment, and current demand. Try and avoid completing tasks as and when necessary – you never know when your orders might start doubling in size.
Whilst you’ll likely identify additional processes in the future, thinking about the core procedures early on will save you time in the long run.
7. Organise your stockroom
Be strict when it comes to organising your warehouse or stockroom. It might feel like a laborious task, but it’s going to help your business to operate in a more streamlined manner. After all, a disorganised and chaotic warehouse can lead to lost inventory, resulting in less revenue and customers.
Some tips to consider?
- Make use of vertical space
- Put your best sellers in clear sight
- Invest in robust storage units
- Set up a label system
- Consider floor marking tape for Health and Safety
- Keep your stockroom well lit, at a regulated temperature
- Keep customers out of the stockroom
- Create an area for orders being shipped and received
8. Build a relationship with your suppliers
When mistakes come around, being able to rely on your suppliers can be the difference between disaster, and disaster averted. To build up your relationship, make sure you keep your communications friendly and clear. IF you stay on top of these relationships, managing your inventory suddenly becomes even easier. In addition to building good rapport, it’s equally as important to monitor your suppliers performance – making sure you can see if you’re getting your moneys worth.
Every business has their own way of keeping things running, but what remains the same, is the importance of control. To learn more about how an inventory management system could become a part of the way you keep things running, book a demo with one of the team today.