As consumers are increasingly shopping online, you have likely felt the need (or already answered the call) and expanded your brick and mortar business to include multi- or omnichannel sales. If you are considering selling your products on Etsy, eBay, Amazon, or social media marketplaces, selling on multiple channels can be a great move for your business because it can increase your brand’s visibility by showing up in search engines, which can evidently lead to more sales.
Using different platforms to sell your products can lead to new challenges, particularly in terms of supply chain management. No matter what you are selling– be it handmade crafts, clothing, or office supplies–having a good inventory system in place is crucial to the well-functioning of your business and keeping your customers happy.
Small Business Inventory Management Best Practices
Step 1: Inventory Forecasting
Forecasting inventory means that you are essentially making a calculated assumption of what products to have on hand or in stock, based on various factors. It can be based on buying behavior from the previous year, month, or current sales trends. It also depends on your type of business. For instance, retail stores specializing in handmade items usually experience an increase in sales around the gift-giving season such as Christmas, Mother’s, or Father’s Day. Due to experience, these retailers know to produce more items during these seasons.
With proper forecasting, retailers can safeguard against having too many or not enough items – as both can result in a loss of money. If you have too many items that you can’t sell, you might have to liquidate or get rid of them, whereas the other extreme – not having enough of a requested item, means your customers will go elsewhere and you lose business.
Step 2: Audit Your Inventory
Auditing your inventory is another way to ensure you know how many items, products, or raw materials are available. Every retail store or business owner has a different way of auditing their inventory and the frequency varies. For example, some might conduct frequent audits on top-selling products only and leave the rest for monthly checks. It’s best to make the time to check your inventory on a regular basis, especially if you receive deliveries from vendors or supplies that are handled by different employees. Making it a habit of verifying stock levels will help you avoid errors that may cost you money.
Step 3: Identify Low Turn Stock
Once you’ve forecasted and audited your inventory, you can quickly spot items that should no longer be carried or only be carried at certain times of the year. In other words, it’s easier to identify low-turn stock – stock that isn’t selling as much–or not at all. The importance of this is two-fold – an item that isn’t selling means you are not making a profit and secondly, it might be costing you money if it’s taking up space in your store and in your warehouse.
Step 4: Quality Control
Quality control sometimes gets left out of the equation, however, it’s key to ensuring your inventory is adequate to sell. Although retail stores use the FIFO (first-in, first-out) approach in making sure that older items are sold before newer ones, it’s always a good idea to conduct regular quality control checks. Taking this practice seriously is helpful as you are protecting your brand’s reputation by continuing to offer top-quality products which in turn, has a direct impact on your customer’s satisfaction level.
It’s also a practical thing to do because it allows you to accomplish other tasks at the same time, such as verifying that your products have the correct SKU numbers or barcodes. In addition, removing items or products that are not of good quality also means you are creating more space in your store and warehouse for other high-demand items.
Step 5: Invest in a cloud-based inventory management system
There are many different types of inventory systems, however, cloud-based systems are beneficial because you can easily access your inventory both online and offline, from any device – a mobile app, tablet, laptop, or desktop computer. In addition, most systems are easily integrated with accounting, order, and shipping management as well as multi-location and barcode tracking. Some examples include Zoho, Square, Shopify, and Payanywhere.
You won’t have to jump through hoops to get simple or complex tasks done after investing in an inventory management system. Chances are you won’t have to worry about overstocking or understocking because you’ll be able to access sales records and reports to help you make accurate predictions (or your system may do it automatically).
In addition, inventory systems are usually equipped to send notifications when stock is low and some can even be configured to restock from vendors and suppliers automatically. If, for example, you make handmade goods, look for a system to assist you in managing your raw material and that also takes kitting and bundling into account.
In omni- or multichannel sales– accepting orders from any platform–, it’s imperative to invest in an inventory management system. As small or niche as your business may be, you never know if your products will go viral from being featured on a popular blog or on a social media page. With an inventory management system, you will be better equipped to handle a sudden uptick in orders, if this should happen. Moreover, you want to make a lasting impression on your customers – having the right products, at the right time, shipped in a timely manner – all play a vital role in making sure your customers have a seamless experience in your store – whether in person or online.
Step 6: Simplify the Process with Sekure
Inventory management is an important but time-intensive process that every business owner understands the challenges of. Did you know that your payment processing platform can assist you in streamlining your inventory and price management tasks?
Let Sekure’s certified Payment Experts help you take control of your inventory and explore the ways in which omnichannel sales can help you to future-proof your business for whatever comes next.