Best Ways to Overcome Inventory Management Challenges in 2024

Inventory Management Challenges in 2024

Best Ways to Overcome Inventory Management Challenges in 2024

An organised and systematic inventory is critical to ensuring smooth supply chain functioning. However, numerous obstacles disrupt inventory management, from changing consumer demands to fluctuating markets and poor visibility into inventory.  

These challenges influence your production and dictate how you fulfil customer orders and ensure timely delivery.  

The good news is that there are solutions with which you can effectively address these issues and manage inventory. Read on to learn about the best ways to overcome inventory obstacles.  

1.Strengthen Relationships with Suppliers  

If a company does not have a good relationship with its suppliers, it can lead to issues such as late deliveries, backorders, frequent stockouts, or the inability to respond to customer demands promptly. 

A strong relationship with your suppliers is essential for a successful supply chain.  

So, build trust and open communication with your suppliers by reaching out regularly and negotiating mutually beneficial terms. Inform them about potential increases in sales, promotions, or other factors that can spike your need for inventory. This will ensure that they keep up with your demand and you maintain the right stock level.   

2.Conduct Regular Inventory Audits  

According to a study, inventory distortion produces losses totalling $818 billion globally in a year, 44% of which is because of overstocking, while 56% is attributed to out-of-stock. The root cause of poor inventory management is inadequate stock management and control.  

Regular inventory audits are one of the best ways to address poor stock management effectively. Some ways to conduct audits include: 

  • High-Value Stock Tests: Also known as ABC analysis, this involves classifying your products based on profitability. Group A comprises popular items, group B is mid-tier, and group C is low-value products. It helps to ensure that you always have the most in-demand items. 
  • Spot Checking: It involves randomly choosing a specific product and counting the units on hand. If it matches your records perfectly, the rest of the inventory level is likely right. However, conducting a full inventory audit is vital if you spot-check and find discrepancies. 
  • RFID Technology: You will be informed when a certain item leaves your warehouse by placing RFID (radio frequency identification) tags on stocks.

    They allow real-time and accurate tracking of the quantity and location of items in your warehouse.

    3.Utilise Inventory Management Solutions  

Investing in a quality inventory management system gives you greater inventory visibility at every stage of the supply chain. With barcode technology, you acquire real-time data about every item to make stock-level and restocking decisions.  

Moreover, inventory management solutions also connect all of your sales channels so that you can optimise shipping and order fulfilment. They even analyse your past sales data and market demand to anticipate future product demand.  

Some notable features, like automated reordering, inventory analytics, and a centralised interface, ensure informed decision-making to improve turnover.  

4.Outsource to a 3PL  

When you decide to outsource to an order fulfilment company, the 3PL manages your inventory without you having to handle deliveries, organise products, and sort everything out. This leaves you with more time to focus on core business operations.  

The 3PL ensures an optimal inventory flow from the manufacturer to its fulfilment centres. It even informs when the stock level goes down beyond a specific threshold.  

They will order more inventory to send across your fulfilment centre, decreasing your fulfilment costs. They even handle dropshipping and purchase orders and ensure you have safety stock. 

Summing Up  

A retail business’s success depends on managing inventory successfully with minimum error. Maintaining a solid relationship with your suppliers and conducting regular audit checks can easily prevent understocking and overstocking while maintaining the right inventory levels.  

You can track inventory, predict demand fluctuations, and enhance supply chain visibility with inventory management solutions 

Quinta hosts a robust inventory management system that is feature-packed to help you successfully navigate the inventory maze. It integrates with essential sales channels, supports real-time visibility, offers demand forecasting, and maintains regulatory compliance.

Leave a Reply

Your email address will not be published. Required fields are marked *

Main Menu