Fast Forward Your Business with Inventory Management Best Practices
What Are You Going to Do Differently Next Year?
We’re going to hit another new year soon and list yet another year’s worth of resolutions.
What goals do you have in mind for your business? How about taking a hard look at what you’re currently doing with inventory for your business?
Here’s a little-known fact about EMERGE App, the company. In its previous life, it sold custom printed t-shirts!
So, regardless of your business size, we know and truly understand your pain points about dealing with inventory in all shapes and sizes.
Here are some no-nonsense, hard-hitting inventory management best practices you can implement RIGHT NOW for your business!
Inventory Management Best Practices
1. Use Technology To Boost Your Business
Are you still using spreadsheets or pen and paper to manage inventory in your business? What clarity and visibility do your employees have in inventory when they hand over tasks to other colleagues? How quickly can you scale up and onboard new employees or managers?
You need to be sensible and realistic about using inventory management software. Using spreadsheets to game your way to inventory efficiency, or searching in vain for a free open-source inventory management solution isn’t going to happen.
We often encounter prospects who yell “That’s expensive!” after we put in a monthly subscription proposal for their business. Think about how much you spend on your morning coffee/tea. Now multiply that by weeks and months. I think a software subscription is a pretty low price to pay to fast-forward your business.
Also, start investing in a barcode scanning and printing package if you haven’t already done so. Once you’ve rationalized your SKU count and applied those barcode stickers, handheld barcode scanning will make light work of creating new sales orders and dispatching shipments.
2. Involve Your Entire Company
Inventory management best practices need to be instilled in everyone in your company, not just your fulfillment and warehouse staff. Like managing change at any firm, management at the top needs to set the tone, pace, and plan for adopting a lean and efficient inventory management attitude in every staff.
One way to do this is to involve every staff by creating user accounts for them. In the EMERGE App, role-based accounts can be created for administration, purchasing, sales, and fulfillment to name a few.
Then user permissions can be assigned based on their responsibilities so that they only need access to information and functions that they need to do their job.
This way stock adjustments and transfers, for example, are closely assigned to specific staff to prevent fraud and theft.
3. Mobilise Your Workers
It’s a given that we’re living in a mobile web world. We spent just about all our social and business interactions with mobile devices instead of desktop computers as in the past.
Businesses should also liberate their employees from their desks and cubicles by enabling them to perform their daily job tasks on the go.
EMERGE App, being a web application, runs in any web browser on any modern device. While you could use it with a mobile phone, it runs best on a tablet with WiFi or a cellular data connection.
Your sales staff, for example, can create and email PDF quotations and sales orders while in the field. Your warehouse staff can carry around a tablet that lists their packing lists.
4. Automate Where Possible
We can agree that job satisfaction is closely correlated to employee performance. An inventory management solution should automate repetitive, manual tasks so that employees are free to add value to their work. Employees who enjoy what they are doing and give their best every day are 8% more productive and six times more likely to be engaged with the company.
Using the EMERGE App, for example, automates the calculation of landing costs for purchases.
This is a major bugbear for purchasing staff. Why pore over orders and numbers manually when software can do it for you?
It can be taxing to apportion additional costs such as shipping and customs duties for each order. EMERGE App will automatically split landed costs by the proportion of the purchase cost of the product.
5. Share Information and Collaborate
We’re all guilty of contributing emails to inboxes of colleagues. It’s all too easy to send an email to every innocuous query or task. The average worker spends 13 hours a week on emails alone, or about one-third of the work week! And 96% of workers said that unnecessary emails wasted their time. And have you tried to follow along, with a complicated thread in an email?
EMERGE App tries to banish email (and chat) clutter by offering tasks and notes throughout the application. You can find them just about everywhere, including customers, products, sales orders, and delivery orders. You can share and upload information of interest to the order at hand.
This enables teamwork, and handover between employees and acts as a single repository of data in your company. The McKinsey Global Institute found that the use of “social technologies” — communication and collaboration between employees — improved productivity by 20-25%.
6. Be Flexible With Price Lists
It’s a common saying that one size doesn’t fit all. It goes to say that one price list doesn’t fit everyone either! In the past, handling multiple price lists for different customers during seasons in a year was a nightmare.
Personalization and customization are great to build customer loyalty and goodwill but you need to have a strict system in place so that prices are not inadvertently leaked out to other customers or even competitors.
EMERGE App lets you assign tiered pricing and custom price lists to your customers. Create seasonal price lists for Spring, Summer, Fall, and Winter and maximize your sales reach every opportunity. Or perhaps you have a few regular, loyal customers on board? Create price lists with discounts just for them.
7. Bring Your Raw Materials On Board
Are you dealing with products that require a little assembly before they get added to your final inventory? Jewellery and furniture immediately come to mind.
You might be using another ERP system to handle simple manufacturing and create production orders. Depending on how your systems are set up, this might prove to be unwieldy if your manufacturing and inventory systems don’t talk to each other.
Raw materials can also be managed inside the EMERGE App. You can add raw materials just like adding new products. Give them an SKU, assign them to a category, or even put them under a brand that your company uses. Once done, easily create production orders by assigning these raw materials to the products that require some assembly.
8. Watch Those Expiry Dates And Batches
Wholesalers and distributors of perishable, pharmaceutical, and biomedical products fully understand the importance of tracking expiry dates and batches. Unfortunately, foodstuffs and medicine are sometimes subjected to recall measures due to improper manufacturing, handling, or storage procedures.
Batches must be traceable to recall and remove them from the supply chain. Customers must be able to check the batch number on their products to return them for a refund or exchange.
EMERGE App has an expiry date and batch tracking feature. You designate which products are to be handled in batches and transactions such as receiving stocks and deliveries will be done in batches. You can assign a batch name, batch code, description, batch number, and expiry date to each batch product.
9. Kickstart Your B2B Sales
Traditional sales channels are typically online and offline stores. Have you explored the potential of B2B sales for your business? Unlike B2C retail where you need to entice fickle customers to purchase from you, B2B sales are more transactional.
Your business customers are buying from you to replenish stock or to fulfill their orders. The prospect of growing B2B sales should not be ignored by your company even though it is still minuscule compared with the vast retail e-commerce market.
EMERGE App includes a free B2B e-commerce platform called EMERGE Cart. You simply create a purchasing account for your customers, specify what products they can see, and then assign a price list. Your customer logs in with their email address and password and browses your instant product catalog. They add their purchases to a shopping cart and then check out. A sales order will be automatically created and listed in the EMERGE App.
The benefits of automation of business purchases cannot be underestimated. Your business customers have the convenience of purchasing from you 24/7, important when you are operating across different time zones around the world! The automatic creation of sales orders frees up sales staff to focus on other high-touch and higher-valued added work.
10. Get Rid Of Deadstock Fast!
Deadstock is the bane of every business dealing with inventory. This generally means stuff that has not seen sales for the past 12 months and is now taking up valuable space in your warehouse and retail shelves.
However, it’s unavoidable due to fast-shifting winds in technological obsolescence, seasonal tastes or fashion. Or just plain, bad purchasing decisions. Without dwelling on the ifs and whys, it’s best to get rid of them quickly and move on. Your money is tied up in deadstock and it’s better to cut your losses now.
So what are the best ways to get rid of deadstock?
Slashing prices to enticing levels works like a treat. Deep discounts like 60% off should encourage buyers to look beyond the technological or fashion changes, especially for last year’s line which is typically still perfectly functional if not outdated in appearance or specifications. Shoes, laptops, and mobile phones easily come to mind.
Bundling is another popular method. Throw in the deadstock product to encourage sales of a complementary product.
You might take a hit bundling the deadstock for almost next to nothing, but any uptick in sales should make up for the loss with your deadstock. And customers love a deal when they see one!
Like any top ten list, this list isn’t exhaustive nor a magic pill to fast forward your business to the next level.
Take a good, hard look at your business and see how you can improve your existing business practices and processes.
Hopefully, you can pick one, some, or all of these to implement for your business in the coming New Year!