When 57% of companies say the supply chain offers a performance advantage, you need to optimize every part of the process you can. However, some companies don't do enough to optimize their supply chain and suffer as a result.
Getting inventory management right is one of the most important things you can do to start optimizing. You can't make money if you don't have products to sell to customers.
Do you want to learn about common errors in inventory management that will cause your supply chain to run inefficiently? Read below to learn four errors you must avoid.
- Poor Forecasting
It's hard to hold enough inventory when you don't know what demand to expect. Things may run normally for some time, but you'll eventually change into a special season like Christmas and get a ton of demand that you can't meet.
You can learn about these situations by doing demand forecasting. This process will help you estimate busy periods to help you buy enough inventory to handle the demand. You won't need to worry about running out of products and losing sales.
- No Software
One of the worst things you can do when handling inventory is manual inventory management. Yes, you can get away with this if you have a few items and nothing more. But as your warehouse grows, it becomes much too challenging to do by hand.
Inventory software will help you manage things. You can automate many tasks and get an accurate count of your product counts.
In some cases, you can get specialized inventory software like veterinary inventory management solutions. These programs are tailored to your specific needs.
- Focusing on Low Performers
You only have so much space in your warehouse and cash to spend on products. It makes sense that you want to use some of those resources for every product you have. However, some companies go overboard and order too much inventory of products that don't sell well.
All those products will do is sit in your warehouse and tie up capital. Instead, focus on giving space to your well-received products that fly out of the warehouse.
You can also use your excess capital and space to try new ideas and create another best-seller.
- Poor Employee Training
It doesn't matter how much work you put into optimizing your supply chain metrics and inventory system: if you have a poorly trained team, they'll make mistakes that cause disruptions in your operation.
Employee training is a must if you want to satisfy your customers. Be sure everyone you bring into your organization gets training on how to do the job right.
A great way to do this is to create standard procedures. Document how to handle each task and continuously optimize the procedure until you create the best way to handle things.
Avoid Common Errors in Inventory Management
Knowing what you have in inventory is one of the most critical parts of an inventory management strategy. Even if you can get products to customers quickly, none of that matters if you don't have products in stock.
Making common errors in inventory management will cause you to lose customer trust and sales. Avoid the problems above to optimize your inventory system for success.
Of course, a robust inventory management system is only one part of running a successful product business. Read more guides on the blog to learn more business tips that will help.