One of the most important elements of any business that sells products is inventory management. However, when you mention this to most people who are in business, it tends to put them to sleep. Managing your inventory is not one of the most exciting aspects of business, to be sure, but it is vital, and you do need to be sure you know what you are doing. If you aren’t careful, and if you do not give it the attention, it truly deserves, then you could find yourself in some serious issues.
Those Who Neglect Inventory
Let’s consider just how this might affect a company that doesn’t keep good track of their inventory. What if a customer places an order for an item that you and your website claim is in stock? The customer places the order, and then waits. They continue to wait without a word from you because you are still waiting on a new shipment of those products to come through. If the customer knew that you did not have those items in stock, he or she could have planned a different solution. Since they are still waiting, and losing patience, you can be sure you will hear about it in comments and reviews, and chances are good that the customer will now be a former customer.
If you have a popular product that a number of people are ordering, or even a product that doesn’t generally sell, it is vital to know how many you have in stock at any given time, and you need to be able to update your listings accordingly. Keep in mind that you never actually want to be out of a product. Proper inventory management means always knowing what you have in stock and what you need more of, so the customers are never without. If a customer is unable to get it on your site, they will go elsewhere.
You don’t want to lose sales simply because you can’t keep track of the products you have available or because you can’t keep up with the demand. Good inventory software will give you a nice overview of your operation so you will always be able to keep the customers happy. Of course, you don’t want the opposite to happen either. You do not want to have too much inventory just sitting there. You need the “Goldilocks amount”, which is just right.
How can you tell how much you need? When you first start a business, you won’t be able to know. However, as you start putting your selling and inventory management software to use, it becomes easier. By tracking how much of a product you are selling normally, it becomes easier to know how much you need to have on hand at any given time.
If you ever find that you do have too much inventory, you can remedy the problem easily. Simply have a sale, and consider some cross selling to make it more profitable for your company.
Have a Backup Plan
While you might have some great software to help you with inventory, shipping, and more, you should also have a backup just in case. Make duplicates of your data and keep printed records of at least a few months of your information, just so you have it if needed. Additionally, consider using the cloud to store much of your data. You can access it anywhere you need.
Never take your inventory for granted. While it might not be as fun as creating or unveiling a new product, it is nevertheless a very important part of your business, so you should treat it as such.