Managing Inventories and the Problems You Could Encounter
Experiencing a need to increase your supply only means your business is growing. While that could be a good sign for your business, you should not feel at ease just yet. In fact, this stage is when you should be more careful and stringent with your internal process.
More of anything in a business means more responsibilities. Failing to manage it properly could end up in dissatisfied customers and a drop in sales. Every business achievement comes with a layer of challenge, but do not let this stop you from expanding.
Inventory problems are prevalent in any industry, but the great thing is that many companies have encountered these problems before you. Knowing what they are would help you understand how they come about and what you can do to prevent or address them.
This article will list the top common inventory problems that retail stores face daily:
Discrepancies in Tracking
Tracking is the most crucial procedure in terms of inventory management
. Inventory tracking gives the company an overview of its inventory —where they are and their status. With the accessible data, the company would know their business performance. It also helps them determine whether there is theft or loss.
Dealing with large supply volumes makes your business prone to mistakes, especially if you are doing everything manually. The inventory is handled by multiple departments in a company. As much as possible, find ways to develop an efficient system. When an inventory list comes with lots of discrepancies, it could lead to operational disasters.
Poor Process in Managing Inventories
The inventory serves as the reference in performing other tasks, from preparing the item to the actual delivery. When there is inefficient management from the start, it affects the whole company process. When there is poor inventory management due to poor processes, it will cause a substantial negative impact on the earnings and growth of the company.
Instead of settling with manual documentation, try looking for a more secure platform. Many applications out there would help you oversee the whole management status easier.
No Performance Measurement Parameters
Key performance indicators should always be present in the inventory process. These pointers help drive the management toward more reasonable and effective business strategies and decisions.
When there are performance parameters, the management gets valuable information about the inventory performance, improves their cash flow, reduces their operating costs, or increases customer satisfaction. Knowing in which areas they are performing poorly on and on which they should capitalise can help push the business towards the right direction.
Another source of potential performance problems is not having any form of transparency internally and externally. Any client who does not learn about internal issues, like delays or other matters, would only result in disappointment or dissatisfaction. When the company can quickly inform the concerned parties about the situation, they can better manage it. The same goes with the team not getting the internal updates they needed on time. By setting a more specific and transparent workflow, you can manage and address the concerns before it becomes huge.
No Good Software
Software is essential now that almost everything is done online. But among the available choices for inventory management
, you need to find the right software or retail EPos solution that suits your business demands best. Make sure that your chosen software features address your company’s current checklist. You should also consider your plans for the business. The software should accommodate further expansion if that is something you are planning.
Trouble in Finding a Decent Merchant
No matter how polished your internal system is or how expensive your chosen software is, if you fail to find quality merchants, you could still experience trouble later. Partner vendors are partners for a reason. They understand when you need supplies and do their best to meet your business needs.
Look up survey sites and reviews online before you commit with a vendor. Doing this would help you see the good points and bad points of the suppliers you are eyeing. If they have a trial period, grab that opportunity before you seal the contract. Asking questions directly can also give you a better understanding of how they work.
Not Enough Warehouse Space
Processes and vendors are essential but do not forget to check the number of items your warehouse can store. Warehousing enables optimised distribution and timely delivery of the whole production. When there is excellent warehousing, labour productivity increases alongside customer satisfaction. The real challenge begins when the warehouse itself fails to keep your products safe. You have to make sure that the items you store are just enough for your storage.
No Identified Proper Management of Problems
There is no perfect business, so expect problems. It would be best to think of the potential errors in your company, production, and processes. Then, try to identify the best solution to each of them.
Create systems for solving these problems. This can help employees know when to take matters into their own hands or let the company know and address their concerns. Without a method to align everything, your business might end up in a big internal headache.
Inadequate Production Planning
For a business to succeed, an entrepreneur needs to be ahead of the game all the time. That means already seeing the needs of the company and having a plan to meet them. Timing is vital in business. One delayed response could be catastrophic for your business.
The production team should always be ahead with everything. With efficient production planning, the team can understand organisational needs in advance. That could optimise the whole process, including the production cycle time. Make it a point to stay ahead of the competition all the time.
Conclusion – Managing Inventories and the Problems You Could Encounter
Inventory management involves making sure that you have the right quantity of products when you need them. It helps you avoid excess inventory (especially for products that are likely to expire) and enables the company to maximise its potential sales.
When proper inventory management is implemented, the company will not lose money on goods it cannot sell. Furthermore, the rest of the departments would also benefit from smoother operations. Expect to encounter these enumerated difficulties. Like the tip above, consider finding a solution to them ahead and educate the team on what to do should any of these happen.
Sometimes investing in quality equipment is the solution the company needs. Find a retail EPos solution
that can solve the majority of your concerns and give you more control over the whole process. With retail EPos
, you can improve the efficiency of your business. Easitill allows you to do that with our comprehensive and scalable solution that grows as your business does. Get in touch with us or call us at 01604 881881 to learn more.