Managing your inventory the right way can make all the difference in your company's success. It helps you avoid time-consuming problems, so you can focus on what really matters--developing your business.
Here are 4 tips inspired by successful entrepreneurs:
1. Plan for peak periods
Does your business have slow periods? Do you need to manage seasonal stock? To help you plan for seasonal demand, draw up a calendar so you can get a clear picture and develop a strategy.
That way you can make the most of the peak season and hold strategic sales to avoid being stuck with out-of-season merchandise.
"We need to have enough inventory, so we don't miss out on sales opportunities," says William Plamondon-Huard, co-founder of Plantzy. "But we can't have too many plants either because they need constant care. It's a careful balancing act."
2. Anticipate supply problems
It pays to be prepared. Badly managed inventory can cost you sales, so it's important to have stock available.
Build a good relationship with your suppliers, but always have a plan B because if you lose a supplier for whatever reason, you'll need to find a solution fast.
3. Estimate the value of your inventory
Your inventory is an important asset. It represents capital and generates profits for your business. When you manage your inventory well, you'll have a lot of information at your fingertips to assess how much insurance you need. And while you're thinking about potential losses, why not take the time to implement good fire prevention practices and develop an emergency and continuity plan?
"We buy our clothing before we sell it," says Vincent Poirier, co-founder of Momzelle. "A lot of our money goes into our inventory, so we need insurance to manage the financial risk."
4. Chose the right type of inventory
Annual inventoryTaking an annual inventory is the most conventional stock keeping method. It's a long, expensive process because you have to stop operating to do a manual inventory of everything in stock.
Rotating inventoryThis is the most popular alternative to the annual inventory. It consists of documenting stock several times a year and ensuring seasonal rotation. It's very common in retail.
Real-time inventoryThis method uses software to record purchases and sales. It's the most efficient system because it tells you exactly how much stock you have at any given time. It can also give you a lot of useful information for planning.
Good inventory management is essential to running a successful business. These tips can help you boost turnover and capitalize on new business opportunities.