siliconindia | | February 20208IN MY opinionanaging inventory is one of the key challenges for any small business today. Ensuring that the right stock is available at the right place at the right time, is a key task as it has major implications on the overall revenues and profitability of a business. One way, most businesses do this to maintain stock as per the last observed demand. But then, there is the risk of customers not finding what they need, leading to lost sales and most importantly lost customers. Another approach is always to have enough stock, and while that may ensure availability of the desired stock, the cost of excess inventory adversely affects cash flow, finally impacting profits. Cracking this thus becomes extremely important for business efficiency.Thus, the key to effective inventory management lies between these two approaches. Here's sharing eights tips and tricks which could help you become more efficient in Inventory Management. · Categorizing your inventory into slow-moving and fast-moving helps you to plan better always. Conventionally, businesses use the ABC method, wherein high-ticket and slow-moving items are grouped under A, and low-ticket fast-moving items are grouped under C. Category B will then have those items which are moderately priced and move slower than C but quicker than A. Another important aspect to consider here is that inventory loses value over time. So, if some stock is not moving at all, one may consider offering discounts to clear the same and free-up blocked cash.· Having a clarity on overall costs gives one the knowledge of what an item actually costs and how much it can actually be sold for. This involves evaluating all costs ­ cost per unit, cost of moving, cost of storing, restocking cost, freight cost and many others. This will help you to manage your profit margins, especially in phases when you need to offer a seasonal discount, or when you need to protect yourself against rising costs.· Maintaining and tracking a complete record of all the products which form part of your inventory is a must at all points in time. This should ideally include info about MA B.SE ­ Mechanical Engineering from the University of Pennsylvania, Tejus has been associated with Tally since 2010 and plays an instrumental role in its day-to-day operations.8 STEPS TO BECOME MORE EFFICIENT IN INVENTORY MANAGEMENTBy Tejus Goenka, Executive Director, Tally SolutionsTejus Goenka,Executive Director
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