Has overbuying inventory ever left you with inventory glut? It can be overwhelming and daunting to face that overload without the right management tools. Trim the excess and get your inventory back in balance by following these five tips:
1. Analyze current demand vs current supply:
It’s essential that the amount of inventory you think you have lines up with what you actually have. Investigate your current supply so you have an accurate picture of everything on hand and where your excess really lies. After you’ve conducted an inventory audit, it’s time to get a handle on demand. If you’re using a PSA software that provides real-time accurate data, you can better understand and manage the complete supply chain affecting your bottom line. You can also run reliable profitability reports so you have a better idea of your inventory hits and misses.
2. Create product bundles:
If you’ve got excess inventory that simply isn’t moving and isn’t in high demand, consider creating product bundles to entice customers to buy more. You can use bundles to group together related products, pair high demand products with low demand products to get them out of your inventory for good, or create discounts by grouping low demand products together for a reduced price versus buying each individual product on its own. Sometimes, the best thing you can do to correct excess inventory errors as you get a hold of your inventory management is to clear out the glut as best you can and avoid the same purchasing mistakes in the future.
3. Implement sales and promotions:
If your inventory is overstuffed with products that are getting long in the tooth, technology that’s rapidly becoming outdated, or items that can be outperformed by more modern options, it may be time to consider implementing sales and promotions to generate revenue before it’s too late. The hit your bottom line will take from a discount will be far less than if you’re stuck with a ton of outdated inventory that is becoming more challenging to move by the minute.
Additionally, sales promotions can be great tools to create customer loyalty and enhance appreciation. According to a study conducted by Claremont Graduate University, “Any time you can offer your customers the opportunity to save more money than the perceived worth of a product, they experience a boost in oxytocin levels. This in turn can create a positive association with your brand when customers recall it later, as they will associate the positive feeling they experienced with your business itself.”
4. Enhance your forecasting and tracking efforts:
It’s time to move beyond manual inventory tracking, especially if you want to avoid needlessly over purchasing inventory in the future. If you want to enhance your forecasting and tracking efforts, using the right technology is essential to keeping your business running at peak productivity. Implementing an inventory management system will help you collect the data you need to more accurately forecast demand and track your existing inventory overall.
5. Improve consistent intake policies:
If your inventory audit revealed a lot of inconsistencies, improving a more consistent intake policy can really help you avoid inventory glut issues in the future. Having a more accurate view of the stock you have on hand helps you determine what you really need to order versus what can wait a while longer. While this becomes less predictable when there are supply chain issues, you can put your best foot forward by improving your intake policies. It may be helpful to retrain your employees so everyone is on the same page about what needs to be done when new stock arrives. Also, using the right PSA software like Rev.io PSA can help make this process streamlined and reduce the amount of inventory that gets lost between locations.
These five tried-and-true methods for overcoming inventory overload will help you get rid of your excess inventory in ways that benefit your business overall. To avoid the same inventory challenges in the future, make sure the inventory management system you’re using is automated, intelligent, and comprehensive.
Learn more about what Rev.io PSA can do to help you intelligently manage your inventory.