Did you know poor organizational skills will cost your business because it affects productivity? Look at improving your management skills by developing an inventory system.

If you would like to learn some helpful management tools, keep reading.

In this guide, you’ll learn some helpful tips for managers who handle a lot of inventory. You could use management software or a tracking app to keep things organized.

Ready to learn more? Keep reading.

1. Assess Your Current Situation

Before you make any changes to your inventory management system, think about the current status.

What are some of the factors that jump out at you? Do you find things work seamlessly for a little while, but then a late supplier throws everything off?

Identifying some of the issues before creating a new plan will help guide you. You should also ask your workers if they could share some feedback about the inventory management system.

You might receive some helpful feedback on how to improve things at work. 

2. You Could Prioritize Your Inventory

Try to categorize your inventory into different priority groups. This will help you understand what items you need to order more frequently.

Prioritizing different items will help to keep your business moving forward. Keep your customers happy by having their favorite items in stock. 

Try separating your inventory into three different groups. In your first group, place your higher ticket items. The middle group is your moderately priced items. Items in your third category might not cost as much.

Assess what items will need to get replaced more often. Do you have an excellent working relationship with the supplier? 

3. Try Tracking the Product Details

Try and keep records of your product information for items in the inventory. The information should include barcode data, suppliers, SKUs, origin countries, and lot numbers.

You might want to track the price of each item over time. Do you notice that the price changes during certain seasons? Will you need to change the price during that season and notify customers? 

4. Audit Your Inventory Items

Certain businesses will complete detailed audits once a year. Some companies prefer to meet monthly, weekly, or even daily audits.

Think about creating a specific inventory audit system. This way, you can keep track of what’s in your warehouse. 

5. Begin Analyzing the Performance of Suppliers

A supplier could end up creating issues for your inventory. If your supplier isn’t reliable, you will need to look at changing suppliers. Some businesses deal with late deliveries or orders without all the required items.

Talk to your supplier about the problem. Resolve the issue and maintain your working relationship. If you cannot come to a resolution, look at switching partners.

6. Try Using the 80/20 Rule

A majority of profits come from 20 percent of your stock.

Understand the entire sales life cycle of these essential items. Do you know how much you sell in one month or a week? Try to monitor the sales cycle. Look at the 20 percent of your stock that sells the most.

7. Remain Consistent With Stock Management

You might think it’s a common sense point to ensure incoming inventory gets processed. But does your business have a standardized approach that everyone will follow?

Do you get complaints from other workers about employees who don’t follow the process? Tiny discrepancies in stock sorting can cause more trouble than it’s worth. Make sure your employees get trained adequately on the stock.

You should make sure everyone’s verifying, receiving, and unpacking packages the same way. Ask your supervisor or manager to check the workers, and prioritize accuracy.

8. You Should Track Sales

Tracking sales is another crucial step in inventory tracking. You won’t simply add up all your sales at the end of the month. You need to know, daily, how many items you have sold and what ones.

It would help if you also spent time analyzing the data. Is there a specific item that seems to sell better during a particular season? Are some products dealing with other products?

Understanding your sales process will help you maintain inventory levels.

9. Don’t Let Vendors Order Stock 

Certain vendors can complete inventory reorders for you. But you might need to reconsider this option. 

Letting someone else manage the inventory process isn’t always the right choice. Your vendors aren’t going to have the same mindset and priorities. As a business owner, try to order the stock yourself and check the inventory.

10. Use Inventory Management Technology

Are you a small or medium-sized business? You might be able to manually manage certain items on this list. As your business grows, consider investing in inventory management software.

Otherwise, you could make mistakes, lose notebooks, or create a mess of your stock items.

Before picking software, you should understand your business’s needs. You want to find software that will provide your business with the right analytics.

11. Try Using an Integrative Technology

Inventory management software isn’t the only beneficial technology to use. Manage your stock with things like a POS system for mobile scanners. Think about what things will work well together.

If your POS system isn’t integrative, you might spend more time transferring the data. This could cause inaccurate inventory counts if you aren’t careful.

12. Eliminate Human Error

Human beings will make mistakes all the time. But when it comes to managing inventory, these mistakes could turn costly. Using inventory management software can help lower potential human error.

Use intuitive inventory software. The inventory tracking software system can remove the need to track inventory manually. Your team should also receive training on how to use inventory management.

Inventory tracking software needs to sync with your store SKUs. Quickly track your inventory between an online store and your physical location. Use a barcode scanner and an online order system.

A barcode scanner will register a new sale in your system. Online orders will show up in the same inventory system. You can track all your inventory sales, no matter where the item was purchased.

13. Warehouse Management Housekeeping

A chaotic and messy warehouse will result in costly mistakes. Also, a messy work environment often poses safety risks. 

Make your employees understand the importance of proper housekeeping and managing the warehouse. Keep your warehouse neat. You can avoid expensive mistakes or slow shipment times.

Set aside a space for sales orders, shipping, receiving, and fulfilling orders.

Set up color-coded shelves or tape off certain areas for particular products. Prepare a cleaning schedule. This way, you know your warehouse will stay clean and well-maintained.

Avoid expensive mistakes by keeping your workplace clean and organized.

14. Try Using Supply Chain Management

Inventory management strategies won’t help if you have a messy supply chain. Now, you should think about supply chain management.

Supply chain management is the process of monitoring and improving your relationships. These relationships include different providers, shippers, or drop shipping partners. You should also enhance any other relationships with various parties.

With supply chain management, track the time between placing and receiving it. Is there a significant bottleneck in receiving, shipping, or production? Don’t delay in reaching out to your partner.

15. Liquidate Your Extra Inventory

Each part of your business and storage space will remain valuable. Keep the necessary products. You might want to have some safety stock in the event of a large order. Avoid disappointing customers.

You should perform a few inventory audits. Focus on your sales logs. What items seem to sell fast? Are particular items staying on the shelf for a long time? Try just-in-time production.

Keep the minimum amount of raw materials needed. Order more when you need to complete production.

16. Create a Reorder Point

A reorder point is where you order more material or product.

With a reorder point, you’ll easily maintain healthy inventory levels. You don’t need to monitor the inventory levels constantly. Set up a reorder point if you get the appropriate inventory management software.

Adjust your reorder points as needed. Customer demand will change over time. A popular product from earlier this year might not be as hot in a few months. Don’t set a reorder point and forget about it altogether.

Don’t Forget These Management Tips

Did you find these management tips helpful? Teach employees the receiving and shipping procedures to set up a successful warehouse. Eliminate costly inventory mistakes by using inventory management software.

Set up a cleaning schedule for your warehouse.

Need more business tips? Help your business succeed with these tips.