Home Business Insights & Advice Expanding your business? Here’s how to manage your growing inventory

Expanding your business? Here’s how to manage your growing inventory

by Sarah Dunsby
1st Jul 24 5:55 pm

Running a successful business comes with its fair share of challenges, and as your venture grows, managing an expanding inventory can quickly become one of the biggest. It’s an exciting time, but it also requires careful planning and smart strategies to ensure everything runs smoothly.

To help you keep on top of everything, we’ve compiled a handy guide that will show you how you can manage your growing inventory effectively and keep your business firmly on the path to success.

Assess your current inventory system

Before making any changes, it’s important to assess your current inventory management system. Are you using manual processes, spreadsheets, or outdated software? If so, it might be time to invest in a modern inventory management system.

Look for software that offers real-time tracking, integration with your sales platforms, and detailed reporting. This will provide you with a clear overview of your stock levels and help you make informed decisions.

Forecast demand accurately

Accurate demand forecasting is crucial for inventory management. Use historical sales data, market trends, and customer feedback to predict future demand.

By understanding what products are likely to be popular, you can ensure you have enough stock to meet customer needs without overstocking. Regularly review and update your forecasts to reflect changes in the market or seasonal variations.

Organise your storage space

As your inventory grows, so does the need for efficient storage solutions. Take a close look at your current storage space and evaluate whether it’s being used effectively. Implement an organised system where products are easy to find and access. Consider investing in shelving units, bins, and labels to keep everything tidy. If your current space is no longer sufficient, it might be time to look for additional storage options.

Implement just-in-time inventory

Just-In-Time (JIT) inventory management is a strategy that aims to reduce holding costs by receiving goods only as they are needed in the production process. This approach can help you maintain lower inventory levels and free up valuable storage space. However, it requires excellent coordination with your suppliers to ensure timely deliveries. If done correctly, JIT can be a highly efficient way to manage inventory.

Utilise external storage solutions

When your on-site storage capacity is maxed out, external storage solutions can be a lifesaver. Shurgard, for example, offers secure storage units in London that can comfortably accommodate your growing inventory.

These units provide a flexible, scalable solution that allows you to store excess stock without cluttering your main business premises. Plus, with 24/7 access, you can retrieve your items whenever needed.

Streamline your supply chain

A well-organised supply chain is essential for managing a growing inventory. Evaluate your current suppliers and consider whether they are meeting your needs. Are deliveries consistent and timely? Are there opportunities to negotiate better terms or bulk discounts? Building strong relationships with reliable suppliers can make a significant difference in your inventory management. Additionally, consider working with multiple suppliers to reduce the risk of disruptions.

Monitor inventory levels regularly

Regularly monitoring your inventory levels helps you stay on top of stock and avoid issues like overstocking or stockouts. Set up a schedule for conducting inventory audits, whether weekly, monthly, or quarterly, depending on your business size and turnover rate. Use your inventory management software to generate reports and identify trends. This proactive approach allows you to address potential problems before they escalate.

Optimise your order management process

Optimising your order management process is key to handling your inventory efficiently and ensuring customer satisfaction.

This process involves several stages, from receiving and processing orders to shipping them out. By streamlining each step, you can save time, reduce errors, and enhance overall productivity. Here are some practical tips to help you optimise your order management process:

  1. Automate Where Possible

Automation can significantly improve your order management process by handling repetitive tasks and reducing the risk of human error. Implement software solutions that integrate with your inventory management system to automate the following tasks:

  • Order Entry: Automatically import orders from your e-commerce platform or sales channels into your order management system.
  • Inventory Updates: Real-time updates of inventory levels across all sales channels to prevent overselling.
  • Order Tracking: Automatically generate tracking numbers and update customers with their order status.
  1. Streamline Order Processing

Efficient order processing is essential for quick and accurate fulfilment. Ensure your team follows clear, standardised procedures for each stage of order processing. Here’s how you can streamline the process:

  • Centralised Order Management: Use a centralised system to manage orders from all channels in one place, reducing the complexity of handling multiple systems.
  • Batch Processing: Process orders in batches to improve efficiency, especially during peak times.
  • Quality Checks: Implement quality control checks at each stage to ensure orders are accurate and complete before shipping.
  1. Train Your Team

A well-trained team is crucial for smooth order management. Provide regular training sessions to keep your staff updated on the latest procedures and technologies. Focus on:

  • System Usage: Ensure everyone is proficient in using your order management and inventory systems.
  • Best Practices: Teach best practices for order processing, packing, and shipping to maintain consistency.
  • Customer Service: Train staff to handle customer inquiries and issues promptly and professionally.
  1. Optimise Packing and Shipping

Packing and shipping are critical components of order fulfilment. Optimise these steps to ensure orders are delivered quickly and accurately:

  • Packing Stations: Set up dedicated packing stations with all necessary supplies and tools to streamline the packing process.
  • Shipping Options: Offer multiple shipping options to cater to different customer needs, and negotiate rates with carriers to save on costs.
  • Shipping Software: Use shipping software to compare rates, print labels, and track shipments.

Implement barcoding or RFID technology

Barcoding and RFID (Radio Frequency Identification) technology can greatly enhance your inventory management. These systems allow for quick and accurate tracking of products as they move through your supply chain.

By implementing barcoding or RFID, you can reduce manual data entry, minimise errors, and improve overall efficiency. These technologies also provide real-time data, which is invaluable for making informed decisions.

Plan for seasonal changes

Many businesses experience seasonal fluctuations in demand. Planning for these changes is essential to ensure you have the right amount of stock at the right time. Use past sales data to identify trends and adjust your inventory levels accordingly. For example, a retailer might need to stock up on certain items ahead of the holiday season. By anticipating these changes, you can avoid last-minute scrambles and ensure a smooth operation.

Use data to make informed decisions

Data is your best friend when it comes to managing a growing inventory. Use the information gathered from your inventory management system, sales data, and market analysis to make informed decisions. Regularly review your performance metrics and adjust your strategies as needed. Data-driven decisions help you respond more effectively to changes in demand and maintain optimal inventory levels.

Managing a growing inventory might seem daunting, but it’s definitely doable with the right strategies.

Start by investing in a modern inventory management system and accurately forecasting demand to stay ahead. Organise your storage space effectively and consider external solutions like Shurgard for any overflow. Embrace Just-In-Time inventory, streamline your supply chain, and use technologies like barcoding or RFID to boost efficiency. Regularly monitor your inventory and plan for seasonal changes.

With these steps, your inventory management will not only handle growth but thrive, keeping your business running smoothly and efficiently.

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