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“Inventory is money sitting around in another form”- Rhonda Adams, USA today
Inventory management is the management of stock and inventory. It is the process of storing, ordering and using the inventory of a business which includes components, raw materials and finished products.
Inventory management involves delivering the raw goods and materials in the receiving region of the warehouse to form a stock. After been stocked together they are then sent to production departments where they are converted into finished products. The final output is returned to the stock region where they are piled up before the shipment. Moreover, the method involves keeping a track of the data which includes serial numbers, price tags, the quantity of the products and much more.
For a company, inventory management is an essential part of its business operations. It’s indeed a liability. However, a huge inventory poses a risk of theft, damage or any shift in demand.
Kuchvi Consulting develops the Best Inventory Management Software in India for large as well as small-sized businesses.
Why Is Inventory Control Important For Business?
The company needs a well-planned Inventory Control System to balance the accounts and financial reports. It is also important to maintain the balance between the stocks in your warehouse. An inventory control provides a better customer service by understanding the customers demand in quick time.
6 Essential Inventory Management Techniques You Should Know
Inventory Management Software Free
Identify The ‘Par Levels’
‘Par levels’ are the minimum amount of product that must be on hand always. The stocks need to be ordered more once the par levels go below the predefined limit. Par levels vary by products and help in systemizing the ordering process. Your staff also benefits from the par levels as they can make their decisions on the products.
First-In-First-Out (FIFO)
According to this rule of inventory management, the older stock requires to be sold first and not the newest one. It, in turn, prevents the product from getting obsolete. For managing the FIFO system, you will need a systematic warehouse to make sure that the old products remain on the forefront.
Build Relationships
Build strong relationships with your product suppliers. Communicate with your supplier and let them know the right time to increase sales. Tell them about the product requirements and let them know the demands of the customers.
Auditing
Daily auditing is a must in inventory management. Match the data on regular basis to keep a track of the products received or supplied. There are various methods of auditing including physical inventory, spot checking, cycle counting etc.
Be Updated
Know your market well. Identify the trend in the market, yearly growth, upcoming promotions, overall economy, planned as spend etc.
Dropshipping
In dropshipping, the wholesaler or the manufacturer takes care of your inventory. You entirely remove inventory management from your business.you don’t have to worry about any expenses relating storage, holding inventory or the fulfilment.
Choose the optimum inventory management technique for your business and manage your inventories instantly.
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