September 21, 2021 
Back in the day, it was utterly challenging to manufacture your product, sell it and restock inventory accurately. However, it’s crucial for a business to accurately forecast inventory needs and manage inventory the best way ever.
Why does your business need proper inventory management?
Did you know, retailers in the USA, for each dollar of product sold, own $1.43 inventory on an average! Unfortunately, about 46% of businesses still use manual inventory management tools or do not track their stocks even today.
Improvement in inventory management processes ensures steady cash flow and forget overspending due to sudden inventory stocking. The money you save here can ultimately be used for business development instead!
An added benefit of accurate inventory management is that it builds customer satisfaction; customers will be confident about finding products from your business, ensuring repeat purchases.
This blog will dwell on tips for smart inventory forecasting and management for D2C businesses. Discover now:
Keep your warehouse organized
To ensure there’s a smooth workflow for your business, always work with an organized warehouse. Find out how you can manage your warehouse:
- Place high sales items at an accessible spot and low sales items at a less accessible spot
- Seasonal products should be made accessible during seasons while making space for year-round products
- Use barcodes and labels for tracking products. A good electronic system to track items is a great way to ensure products reach customers safely and customers can track their products.
- Maximize vertical space at your warehouse with a shelving system (disclaimer: ensure you have tools to manage workers access at the upper levels)
- Treat the FIFO rule religiously; First In, First Out rule helps ship out old stock & bring in new stock right after
- Especially for products with an expiration date, keep older stock closer to the employees than newer ones; helps deliver the older product first
- With FIFO for long shelf-life products, you can get insights into which product the customers enjoyed; the product from the old or new stock!
Define product priority
Not all products will be your best-selling products! There will always be products with great sales in your warehouse and products with less priority and sales.
Inspired by the Pareto Principle rule, also known as the 80/20 rule, use it for hour inventory management by keeping 80% products that are popular and 20% products that bring in profits.
Mark out a minimum and maximum stock ranges
Just like we do at home to keep tabs on groceries, apply the same minimum and maximum stock levels for products to ensure you never run out of products and end up owning the most efficient warehouse. Vinculum may be able to help track sales, performance, and more in real-time.
By marking out the minimum and maximum stock for each product in your warehouse, you can also analyze sales of products based on seasons, months, and other parameters.
Enhance forecasting & performance cycle analysis
The best perk of enhancing forecasting and performance cycle track for products includes that you will never find product shortage or overflow. With smart data management, know what to order when and get it sold before the next stock arrives!
To enhance forecasting of product flow, you may invest in trending tracking systems that automate and enhance inventory management.
With an effective inventory management system, you can be prepared for holiday seasons well ahead of time.
Shrinkage awareness is also necessary
Shrinkage rates are all about the % of items getting returned, damaged, lost during shipping, or are faulty. In other words, they do not contribute to a business’s revenue positively.
Shrinkage is common; own extra count of products as a contingency measure, you never run out of product to sell!
Accelerate unloading of products
While transferring products to the distribution center(s), handle the unloading process with utmost care. Some tips for handling stock include:
Ensure there is sufficient space for unloading of products & employees
Organize and label your products correctly
Rely upon skilled labor who can take care of your product & not mislabel anything
Be ready for risks
There is always scope for things going wrong; for instance, the pandemic blocked several shipments, which may have caused risky losses. As a business, you must be ready to handle accidents, thefts, or even natural disasters!
Sometimes, technical issues may emerge as well, so always have a backup plan. A D2C Business may not be able to accept products from other manufacturers but, others were like insurance; being open with the customer about the problem and returning payment are small ways in which you can manage such a big problem.
One shipping partner is never enough
As mentioned in the previous point, contingencies may be there. A couple more shipping partners can be of great help! Benefits of working with more than one shipping partner include:
- Get wide shipping options are good rates
- You can pick between convenient and smart shipping options
- Get too for negotiating shipping rates because you have backup
- Can help during contingencies; you may receive products from one shipment company and not the other. Work always goes on
Think about more storage facilities
With multiple storage facilities, spread the reach, reduce shipping times and keep your customer flowing with products.
More storage facilities imply higher customer satisfaction and client retention.
In conclusion
Efficient inventory management will help your business build your business and retain your customers. Moreover, the cash flow will be streamlined. This will help you expand your business and soon go global!
With Vinculum, your business’s inventory management can be enhanced and streamlined. Talk to us to learn more.
