Tips to Effectively Manage Inventory for Online Stores

The online store has becoming more and more popular, and it allows easy navigation for both customers and business owner. Nevertheless, no matter your store is online or physical, the physical inventory management is still an essential aspect. It can be simple and tricky depending on your product range and demand.

In order to make the inventory management becomes simpler, please refer to our general 5 tips below.

  1. Sorting and Grouping the products : If your inventories are vast and un-organized, it could be a disaster. The best way is to list out the parts and categorized them to group the like product together. This will save you a lot of times when you are looking for something in your inventory.  Some companies use the selling together items strategy, in which, they grouped the items that are most likely to be sold together near each other, while some companies use the top-selling items strategy in which they grouped the top 30% bestselling item together.
  2. Implement an Inventory Management Software: Pencil and paper or Excel spreadsheet are not the best solution when your inventories have become vast and required multiple users to handle them. Because there will be a lack of real-time data, and high possibility for human error, such as mistyped the number, or misplaced the data. Apart from this, with pencil and paper, the handwriting can be vary from one person to another in which it can lead to the misunderstanding among the user.  Inventory management software is specifically designed to handle and keep track of your inventory. They are cloud based, which allows multiple users to access and make changes from anywhere at any time, and the data will be real time updated.
  3. Barcode Scanning : Implement the barcode scanning to improve the picking efficiency and reducing the packing and shipping error. The barcode system can help you save time in locating your products, which resulting in faster shipment.
  4. Analyze your data for restocking decisions: Make sure to analyze the inventory and customer purchase data to form the restocking decision. This is one of the crucial parts in the retail business, because you always want to make the customer happy by instantly serving their demand by stocking the right items. However, if you over stocking the items, this could create both spacing and financial problem. Inventory data analysis can be done in many ways. For example, you can make a quick tour of the aisles to see what items are short. In addition, you can use the “Min” value of the stock level to plan for the re-ordering, and the “Max” value to represent the targeted stock level.
  5. Regular Auditing of your inventory : This is the most effective way to verify that your inventory and your data are matching up. Without regular auditing, this can lead to misplaced of data, wrong location of the products, or incorrect restocking schedule. There are a few ways to get your audit done. You can start by physically counting all your inventories. Most of the company will conduct this checking at the end of the fiscal year. However, in order to avoid the time consuming of counting all inventories at the end of the year, some company prefer the cycle counting, in which the inventories are checked in cycle, for example, different product each day, week, or month on a rotating schedule. 

We certainly hope that the above tips are more or less helpful for you to improve your inventory management.


Credited : Chinh Nguyen
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