If you have a retail business, a lot of your time is going to be spent managing your inventory. While this blanket term may sound like a relatively easy job, managing inventory can take hours and hours each day and still not be completed. However, having accurate and efficient inventory management is often the difference between having a successful retail business and an unsuccessful one. So to keep you from losing money on your inventory, here are three tips for better managing your inventory and your spending.
Know When To Reorder Or Stop Ordering
For businesses that only sell one item, it’s going to be pretty easy to manage and track that one product. But once you get into businesses that have hundreds or even thousands of products, that’s when managing your inventory really becomes important, especially when it comes to knowing when you reorder certain products or stop ordering certain products. To help with this, Ronald L. Bond, a contributor to Entrepreneur.com, shares that if your products are selling well and have lower numbers in their stock balance, or if you’ve started selling a hot item recently, you should definitely start reordering that product. On the other hand, if you have a product that has been on the shelves for a while, you shouldn’t order more of this item until or unless the ones in your inventory already are gone. In this case, you might want to reconsider selling that specific product in the first place since it may just be wasting your money by sitting in your inventory.
Create An Alert System
When you have a lot of different products, keeping track of what’s selling well and what has been in inventory for a while can be a full-time job. One way to make this system more efficient is to bring in an alert system that will inform you of the status of your stock. Lee Polevoi, a contributor to Intuit QuickBooks, recommends using an alert system that links with the bar codes on your products to automatically track and inform you of how well certain products are moving. With these alerts, it will make it easier than ever to stay on top of your inventory spending.
Develop An Inventory Receiving System
A lot of problems can occur between ordering your products, putting those products in inventory, and then selling those products. To streamline this process and eliminate as much error as possible, Ian Atkins, a contributor to FitSmallBusiness.com, suggests developing an inventory receiving system where you systematically reconcile any inventory you receive against your purchase orders. If there’s any discrepancies, you’ll then be able to recognize them immediately and get them taken care of as quickly as possible to save you as much time and money as you can.
If you’ve been struggling with managing your inventory, use the tips mentioned above to help make this process easier on your bank account and on your mental health.