Think about a successful retail business that is selling products and goods directly to its customers. In your mind, you might have pictured a small business, local shop, or a well-established supermarket. Then, you try to figure out what these retail businesses have in common. They both have a certain number of products and goods to keep in stock, right? What if they both have a physical store and online shop? How do they keep track of the products and goods in stock and being sold out?
By now, you see how vital it is to have effective inventory management for retail business. This is why we thought giving you a heads up on how to manage inventory is necessary to keep business operations seamless and properly organized. We’ve also got the most effective inventory management techniques to guide and help you in running your own retail store online.
Image taken from Nithi Foods website
What is inventory management?
Inventory management is a process of tracking and organizing your inventory and number of stocks that come in and out of the warehouse or supply storage.
According to the Bigcommerce article, inventory management is the basis of a well-functioning retail business. Stock inventory management systems track the lifecycle of the inventory and stock as it comes and goes out of your business.
Moreover, the goal of managing inventory is to keep you updated and well-informed of the status and movement of inventory as well as its quality and quantity. An effective inventory management will help the business owner to address discrepancy and correct it immediately.
What are the types of inventory?
One must understand the things that are being compromised when mishandling inventory and stocks. This way, as a business owner, you can come up with the most effective inventory management depending on the type of inventory you have. Derived from the Business News daily, here are some of the types of inventory that you need to keep track of.
- Raw materials
- Materials that are used to manufacture your products
- Finished products
- These are typically stored in a warehouse until sold or shipped
- Unfinished products
- Not ready to be sold yet
- Cycle inventory
- Products are shipped to a supplier or retailer and directly sold to consumers
- In-transit goods
- These are goods that no need to be placed in a warehouse, it goes directly to its final destination
- Anticipation inventory
- Products in anticipation of a surge in the sale
- MRO goods
- Stands for ‘maintenance, repair, and operating supplies’. It supports the production process
- Decoupling inventory
- Parts, supplies, or products set aside in anticipation of a slowdown or halt in production
- Buffer inventory
- Also known as safety stock, in case there’s a need for more inventory
Image taken from Dr. Chai website
Why do you need inventory management for your business?
If you’re serious enough to run your retail business, and you aim to keep it longer, then it’s a must that you come up with an effective inventory management. You need to keep track of the products that are most likely to get sold out on the shelf and make sure you have plenty of stocks to cater your customers’ needs. Having proper inventory management will keep your supply-chain well-organized. Also, it can give you a quick evaluation of the products and goods that your customers regularly purchase while you get rid of the ones getting rotted in stock. This is helpful for retail businesses selling goods and products that might lose good quality if they’re stock for a period of time.
Image taken from Siam Coco website
Sometimes, out of stocks and overstocks happen due to manual inventory methods. A customer places an order while the retailer doesn’t have accurate information of how many stocks they got. Without inventory management, you won’t have a detailed record or an up-to-date file of the number of products in your warehouse and how much more you need to add. Thus, you end up with too little or too much stock. This mistake will not only cost your company resources and funds but also cost you time and energy to correct your records every now and then. If you don’t have effective inventory management for your business, you’re wasting time, money, and energy in updating and reorganizing stocks manually.
Image taken from Namesake Coffee website
8 Tips and techniques for managing inventory
1. Proper prioritization
Most experts would suggest that properly categorizing or segregating your inventory into 1, 2, 3 groups can help you to achieve an effective inventory management that works for any type of inventory.
2. Tracking product information
What is the information you need to keep track of? The information should include SKU number, barcode data, suppliers, location origin, and important details about the inventory. If you keep a record or file of this information, it would be easier to control the in and out movement of your inventory.
3. Inventory audit
An effective inventory management means having a timely audit on the number of products that were sold and left in stock. It helps you track the quantity and quality of inventory you have in your warehouse or storage room. Also, having an inventory audit keeps you well-informed of your business finances and needs.
4. Analyzation of supplier performance
Why is it important to analyze your supplier performance? Because it will serve as your basis to evaluate and discuss certain issues that seriously affect your business operations such as habitual late on deliveries, inaccuracy in terms of the products ordered, and regular shortage on the number of orders.
5. Consistency on how to receive stocks
Be consistent enough on how you receive stocks. This means you need to have effective inventory management that really works. Having a routine or system on how you receive incoming stocks will help you in managing inventory.
6. Sales tracking
It is another form of auditing but focuses more on the number of sales (or the number of stocks going out of the inventory). You will come up with effective inventory management by tracking sales on a daily, weekly, or monthly basis. This way, you know which items or products you can increase orders the next time you contact a supplier.
7. Orders restocking
You can do it yourself or have an employee or someone you can rely on to perform this task. This is a very important technique in stock inventory management because you are able to prioritize products that you want to get sold fast. You can have promotional discounts on the products that seem to stay longer on the shelf. By doing it yourself, you are personally aware of your customer’s needs and preferences.
8. Inventory management technology
This eight effective inventory management is perfect for small retail businesses. Though some might work on large corporate businesses in the retail industry, this last technique is the best among the rest. Digital technology can help you manage inventory without using too much time and energy. If you run a startup business, let’s say you own a local shop, creating a list with a spreadsheet is still good. But if you’re a corporate business owner, you must consider investing in inventory management softwares.
Image taken from Namesake Coffee website
Setting up your online store with Strikingly
Hooray! You made it all the way to the most interesting part of this content. How to set up your own online store with an inventory management feature that you can edit easily and instantly? Strikingly has a solution to your problem if you’re getting out of control of your inventory files. Just like what we shared with you, you can run your retail business online or offline, but an effective inventory management can put your business on top of the competition. Setting up a simple store on your business website is fast and easy with Strikingly.
• Create a website with Strikingly
The first step you need to do is make the right decision in building your site with a website builder that has a great foundation in terms of providing the best services and tools to its users.
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• Choose the best ecommerce website template
Choose from our multiple pre-designed templates with stunning web designs. You don’t need to sweat on things like layout designs and stuff because our team of web designers and developers will handle it for you.
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• Enjoy a pro plan access
Of course, you can also set up your online store for free. But if you are aiming for your business longevity and stability, invest in acquiring valuable features and services that can help your business have a strong and secure online presence. Effective inventory management technique is one reason why you need to invest in website building. When you go with Pro or VIP plan access and enjoy 30% off with our mid-year sale. It’s for a limited time only!
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• Add a simple store
Yes, you can easily add a simple store to your site. This feature will allow you to sell products and stuff online while you keep a physical store at the same time. Our simple store allows you to upload images of the product, set shipping policy, and include important details such as pricing, color, and specs.
Image taken from Strikingly website editor
• Add product information to your product page
Take note that you can add up to 300 products if you get a Pro plan. The cool thing about setting up your online shop with Strikingly simple store feature is that the quantity of stock is visible for you -- the best way to manage inventory without having to go through your files and records all the time.
Image taken from Strikingly website editor
• Go live and keep track of your dashboard
Congratulations! You now have a business website where you can manage inventory, check on your sales, and run your business anytime, anywhere.
Strikingly is all about empowering our users with the tips and techniques they need in order to excel online. Whether you are a retail shop owner, a small business owner, or a corporate business manager, we know how important it is to come up with the most effective inventory management techniques. Choosing a website builder that has all the things you need in business operations and inventory management is such a great relief. Take the first step to be great. Sign up now!
