Inventory Mistakes to Avoid
By Debbie Gregory.
VAMBOA hopes that you have enjoyed the first three articles on Inventory Management and that they have provided you lots of valuable information. We have three more articles coming and this is the first of the three.
We all know that everyone makes mistakes occasionally; but, when it comes to inventory, you want to make sure you keep those mistakes to a minimum.
Below are a few mistakes you might encounter and what you can do to solve them:
1.) Lack of Inventory Management:
This one is the BIGGIE…. If you did not invest in your inventory management at all or you don’t pay enough attention to inventory management, you are more likely to make costly mistakes. Be sure to provide you and your staff the best training as well as select the right tools for your business.
2.) Excess Inventory:
This one is obvious: Do not buy so much stuff. Unfortunately, it is not always that simple. It is important to analyze your past sales performances to forecast what you will realistically need. Check in with your suppliers to see how quickly they can refill orders then set up an automatic reorder limit in your inventory management software to alert you when it is time to restock.
How do you get rid of excess inventory?
You are going to order too much of something at some point in time or demand for a popular item will suddenly drop. This will happen sooner or later. What can you do? Try marking the items down on clearance to promote and sell them because people love a good deal. Perhaps you might consider sitting on the item until next season or try a new market that may want the item. You can also check with your suppliers to determine if they will arrange a return.
3.) Not Enough Inventory:
This is the other side of the coin. Proper inventory management helps you better forecast your inventory and product seasons, ensuring that you buy products in the proper quantities for your demand. You really don’t want someone to order something from your website, only to discover you don’t actually have it in stock. Make sure to have a system in place that allows you to keep on top of your inventory.
4.) Miscommunications:
Miscommunications happen all the time. They are more likely to happen if you recently changed processes, changed software, added new hardware, added new products, or started a special promotion that you did not communicate properly to everyone else. To address these types of problems, it is best to have one person at your company handle all the ordering, or setup your inventory management system to automatically place orders for you.
5.) Shipping & Returns:
Typically, lots of sales can translate into a lot of returns. Make sure you know how you are going to deal with returns, especially if you work with a drop shipper. Will returns come to your location or to theirs? Who is responsible for making sure the returns are not damaged or unsellable? How are credits and refunds made? You do not want to be in a situation in which you issue a refund to keep your customer happy and then get stuck with the unwanted item if the supplier won’t take it back. Make sure that you have clear shipping and returns policies in place.
Inventory management today is much easier. Thanks to items including bar codes scanners, inventory software, warehouse management software, artificial intelligence, and more, businesses can handle inventory management better than ever before. We hope that these tips can help you avoid problems with your inventory.
To manage things especially now that you and your team may be working more remotely, you may want to upgrade your computers and peripherals. For this reason, VAMBOA has joined forces with Dell Technologies to offer VAMBOA members and friends significant discounts.
Check them out here: https://vamboa.org/dell-technologies/
If you are not yet a member of VAMBOA, we welcome you and want you to know that there are not any fees or dues. Here is a link to join and spread the word:
