One of the most important components of many businesses is their inventory. Inventory is what allows a company to sell products to consumers to create revenue. If an inventory is managed efficiently, it can help boost profits. If it’s not, it can become a drain on the business’s finances and lead to its eventual downfall.
How companies manage their inventories is also continually changing and improving. It would be foolish for your business to ignore this progress. It can certainly increase your bottom line. With that in mind, below are a few different ways to keep your inventory up to date with modern standards and practices.
Invest in Inventory Management Software
If you wish to run an e-commerce website that ships products to customers all over the country or even the world, inventory management software is an absolute necessity. It will give you the intelligence to manage your inventory more efficiently and only stock products customers actually want.
This software can actually automate much of the process. If stock for a certain product gets too low, the software will order restock automatically. The new stock will arrive in the warehouse before current stock runs out. This helps ensure that customers can buy products when they want them. Similarly, the software can track products that are underperforming and slowly phase them out of your online store. Overstock is, of course, another significant cost for online retailers. RetailWire reported that overstock and out of stock products cost retailers as much as $1.1 trillion a year.
Implement RFID Tags
RFID is an acronym that stands for Radio Frequency Identification. RFID is a technology that uses radio waves to identify specific items, animals or people that have a RFID tag. RFID technology was introduced as a replacement for barcode scanners. The obvious advantage over bar codes for RFID is that the tag in question does not need to be in the line of sight for a RFID transceiver to activate the transponder that exists within the tag.
In regards to inventory control, RFID is a game changer. RFID greatly increases inventory management efficiency over previous choices like bar codes. Beyond that, it can do a great job of removing human error from the process. If an item includes an RFID tag, it can be easily located within a massive warehouse. This can eliminate one of the main sources of warehouse shrinkage and lower costs as a result.
Source Your Products
In today’s rapidly changing marketplace, it can be difficult to keep track of what items should be kept in stock to sell to customers. Tastes can be fickle, and trends can change overnight. One way to ensure that you always have relevant products in stock is to practice good product sourcing.
In the simplest terms, product sourcing can be thought of as a strategy you use to find products produced by other companies to resell through your business. Today, most of that product reselling is done digitally through e-commerce websites. Some of the largest retailers in the world like Amazon have become experts at product sourcing. This is typically done through a supplier you work with to find products customers want. It can include drop shipping in which a wholesaler ships the products for you from its warehouse. It also includes options like light bulk and volume wholesale in which you’re in charge of storing and shipping those products out to customers.
Today, the retail landscape is largely dominated by e-commerce websites. As such, inventory control is more important than ever. Make sure your company invests in the tools it needs to provide customers with the products they want when they want them. If you don’t, your competitors surely will.