An inventory tracking system is integral to any business that wants to grow. With the help of effective inventory management strategies, you can keep track of items in stock, ensure timely shipments, and increase profits in your business. The chances of losses will be minimal.
Despite the benefits of an inventory tracking system, many small businesses still have trouble managing their inventories. Unfortunately, failure to organize or track inventory can quickly turn the work into a nightmare. You must be creative in how you manage your stocks to succeed.
The good news is that this guide explores the strategies small businesses can use to manage their inventory and grow. These tips will also transform your inventory management system.
Inventory Management Strategies to Implement in Your Business
Managing an accurate inventory is essential to the success of any growth-oriented business. It helps alleviate unnecessary tasks, create a conducive work environment, and ensure everything is in order. But without inventory tracking, you might work harder but get lesser results.
Here are the tips for managing an inventory system for small business operations.
1. Prioritize and Organize Your Inventory
You can categorize your inventory into a few priority groups to help you stay organized. The priority groups will help you understand the items to order more frequently and the ones crucial to your business but costs more or move slowly. The priority categories for an inventory are:
Category A: Comprises higher-ticket items with tight control and accurate records.
Category C: Consists of lower-cost items that sell or turn over quickly.
Category B: This group comprises moderately priced items that move out of the door slower than items in Category C and faster than Category A.
Once you have prioritized your inventory, organize the products by type in the same spot. However, if you keep items in boxes, place digital photos of the products on the boxes’ exteriors to make inventory management more accessible. You can also use stickers with SKU numbers.
2. Get Rid of Old, Unused Inventory
Unused inventory in your store can only add more unnecessary work, so consider disposing of the items. But the truth is that you fear throwing away anything you’ve invested your money in, and you want every cent to count. However, clearing out unused inventory is more beneficial.
Consider decluttering your workspace if your inventory is full of supplies you no longer use or sell. You can throw them away, sell them at discounted prices, or donate them. After that, you must log the adjustment in your inventory system to reduce the time spent updating it.
Pro Tip: Get rid of anything you haven’t sold in a year or used in six months. Also, adhere to the one-in-one-out rule, where you don’t bring a new product before the old one gets sold.
3. Track Your Best Seller Items First
Studies show that 80 percent of sales often come from 20 percent of the existing merchandise. That means only a few items are the biggest profit generators in a business. So, when taking an inventory manually, it makes more sense to start with the items experiencing the most changes.
Identify the best sellers in your store and count them with your eyes to check if the number matches what’s in the software. When you finish with the best sellers in your inventory, it will be easier to sort the remaining stock. So, place the best seller’s items in a prime storage location.
Please don’t tuck away the best-selling items at the back of the storage space. Instead, keep them close at hand, such as setting up a shelf in your workspace. As a result, you can quickly access the items while keeping the office space free of clutter.
4. Keep Your Business Inventory Off-Site
You may have difficulty getting work done if your workspace gets cluttered with excess inventory. The good thing is that you can reduce the clutter by moving part of the inventory from the office into a self-storage facility. Thankfully, Vaultra Storage facilities are secure and reliable.
You might get tempted to use a home garage as the storage space for your inventory. However, most homeowners’ associations restrict people from storing inventory in their garages. Besides, most garages are not conducive to inventory storage, making rented storage spaces better.
5. Use Reliable Inventory Management Software
Many small businesses use spreadsheets to manage their inventory. But as they grow, they opt to advance to simple inventory management software to track items more efficiently. Thankfully, many inventory-tracking software tools are available. Some are free, while others are payable.
If possible, opt for ERP software developed for inventory management. With that, you’ll be able to manage your order-to-cash processes and supply chains in a single system. Besides, it allows you to incorporate other technologies to optimize your inventory tracking system.
6. Automate Your Inventory Management System
Manually updating and tracking an inventory can be tiresome, frustrating, and time-consuming, primarily if you manage a large inventory. Also, it can result in many errors, leading to potential losses. So, automate your inventory management system to streamline your operations.
An automated inventory ERP system can handle demanding inventory management tasks more efficiently and accurately. Since all the sales orders and purchasing data are on one system, you can track and update the inventory levels in real time.
7. Integrate the Mobile Technology
Integrating mobile technology will give you quick access to your inventory management system, improving efficiency significantly. Thanks to the inventory mobile apps, you can easily track your inventory from your mobile device anywhere. Besides, the apps offer real-time inventory data.
With the help of a mobile inventory tracking system, you can control and track inventory at any time from any location. All you need is a strong internet connection. The good news is that most modern ERP solutions provide mobile app access to suit the users’ needs.
Developing a reliable inventory tracking system calls for effective inventory management strategies, such as the ones discussed in this guide. The most crucial one is to leverage modern inventory tracking technologies, like mobile technology, inventory system automation, and ERP solutions. As a result, you’ll quickly respond to market demands by having enough stock.