7 Inventory Management Tips Every Business Should be Using
Did you know that more than 40% of small businesses in the United States don’t take regular inventory?
Skipping inventory can cost your company thousands of dollars each year and lead to waste.
If you want to make the most of your products and track where they go, you will need to spend time doing inventory.
Continue reading to discover some of the best management tips that will help improve your company’s process!
- Build a Team
One of the best inventory management tips to follow is to build an team.
Your inventory team should consist of 3 to 4 people who are responsible for inventory. It is important to only have a few people in charge of inventory, otherwise, you increase the risk for errors or conflicting information.
Some businesses hire people to focus fully on, while others have management take the task. Whoever you have helping the process should be trained and understand company expectations.
- Stock With Purpose & Consistency
When you want to manage products at your company, you must always stock with purpose and consistency.
Stocking with purpose means that you store similar ingredients or products together. Many professionals will also recommend that you stock and store items in the order you purchase them from. This makes it easy to go down your inventory list to identify what you need without hopping around the place trying to find each item.
You must also stock with consistency. Putting products in the same place every time can make a lot easier. This is because your inventory team will get into a flow and be able to recognize when product levels are missing or too low.
- Invest in a Software
Finding the right business tools can make a dramatic difference in how efficient your company is.
Some of the most common inventory software systems include Oderhive, Upserve, and inFLOW. You can also check out Lightspeed Retail or Megaventory! Each software program will have unique features that will help you determine if it is the right option for your industry.
Many people recommend getting a barcode scanner inventory software to make the process quicker. With this software, you can easily scan each item you have in, and the list will automatically record and count what you have. This can save a lot of time on entering data, counting, and organizing information.
- Create a Workflow
If you want your inventory team to successfully take and order inventory, you need an established workflow.
A workflow should have all of the details about taking from start to finish. The more detailed that the workflow is, the fewer issues and questions that your team will have. Creating a workflow might take some time to do initially, however, it will save you a lot of time in the long run.
Workflows allow employees to understand what is expected of them and how they can meet your expectations. The process should use simple terms and procedures that anyone could understand. Work with your team to fine-tune the process and get it down on paper.
- Find the Right Style
When it comes to company management, it is always helpful to look at what your competitors are doing.
Many styles can be used by businesses, and some ways work better for others. When starting with inventory, make sure that you know your needs and business so that you can find the most effective style.
For example, if you work in the food or restaurant industry, you will want a tracking program that is compatible with your vendors and items. A shipping warehouse or auto company will require a different style because their products are different.
By talking to your competitors, you can get an idea of the styles that work best in the industry. This is a great way to get to know other business owners in your area and start on the right foot.
- Set Par Numbers
Par numbers can be helpful when managing because they set the standard.
If you want the inventory to be so straightforward that anyone in your company can do it, you need to set pars. Par numbers are the average number that the company should have on hand. These numbers might vary for certain ingredients over the year, depending on product and service demands.
Learning how to set par numbers is essential if you want them to be effective. Take a look at your sales and inventory purchases for each item. You can them identify how much you go through of each product in each season.
It is important to look at data ranging over several years since you want to compare the needed numbers for each month or season.
- Follow the Data
As long as you are recording inventory and sales accurately, you should follow the data.
An inventory system can produce charts, graphs, and detailed reports about your inventory. On these reports, you can view the products that you have been consistently running out of or the ones that aren’t moving well.
This data will help you save money and make smarter business decisions because you will be well informed. The more that you understand about inventory, the easier it will be to stock your building and meet customer demands.
Inventory Management Tips You Don’t Want to Overlook
Many inventory management tips can save you time, energy, and resources.
If you want to have an efficient and productive process for taking inventory, you need to build a plan and a team. The more time that you put into the planning, the easier it will be to ensure that your business has everything it needs.
A strong business plan should include the process of inventory because it helps determine your budget and workflow.
Be sure to check out our blog for more articles about business tips and how to manage the back of the house at your company!
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