While you may have ideas about the demand for seasonal shopping, there’s no telling when things may go quiet, especially if you don’t do any inventory forecasting. You might end up with too much inventory and diminished revenues. So, today, we’ll help you nail your inventory forecasting by improving how you manage your stocks. Here are some actionable tips to optimize your shop’s stock management.
- Identify gaps between supply and demand.
The first thing you should do is look back at your inventory log in the past few months. Was there any period when the supply didn’t meet the demand? Analyzing those moments can help you identify the gaps in your stock management processes. Also, don’t forget to track current trends. Do your consumers often buy two particular items at once? Are there recent changes in their buying behaviors? Answering such questions will help you find out your next step.
- Anticipate the delivery times.
Another way to improve your stock management is to anticipate delivery times. That’s especially beneficial for avoiding stock-outs before massive sale periods like Christmas or Black Friday. Always plan for a buffer; make sure your products arrive at your warehouse a month or two weeks before any crucial sales period. Do you have several warehouses? Explore your options for sending emergency stocks to a warehouse that needs them.
- Categorize your stocks.
Want to avoid overstocking? Start by categorizing your stocks. You can categorize them by target customer type, profit margin, or the overall cost of the stock. For instance, you can divide your inventory into three categories: A, B, & C. Category A includes big-ticket items that don’t move quickly but are still crucial to your inventory. You don’t want to overstock this category, as doing so may affect your business’s cash flow. Category C includes low-cost items that move out of the door quickly. You can maintain a higher stock level of such items since they don’t cost much and there’s a high demand for them. Category B is for stocks in the middle of the pack. These are moderately priced items that move out of the door slower than C stocks but faster than B items.
Setting up a category system helps you maintain optimal stock levels, meeting various types of demand while minimizing your storage and inventory cost.
- Enable pre-orders for new collections.
Can’t predict how new collections will perform? Here’s a way to avoid overstocking new products: enable pre-orders. When you allow your customers to pre-order, you can test the market for your new product collection. You will know exactly how many items you should have for your first batch of orders to not overstock. That number will also help you decide how many items to stock for the succeeding orders after the pre-order period.
- Automate some processes.
Manual data entry of the number of stock items isn’t only time-consuming but also prone to human error. And those minor discrepancies can heavily affect your stock management and forecasting. So swap your spreadsheets for automated tools if you want more efficient processes and accurate reporting. Software programs for stock management can also be easily integrated with other systems, including e-commerce selling platforms like Shopify.
Optimize Your Stock Management Through Kentro
Ready to apply the tips above? Start by switching to Kentro. It’s a modern ERP software designed for commerce, making your inventory tracking and warehouse management easier. It even allows you to manage other aspects, like sales & fulfillment, on the same platform. That way, you can lower the risk of overselling, stock-outs, and other inventory issues.
Additionally, you can track your stock levels in real-time—even if you have multiple sales channels—which enables you to plan your purchase orders more efficiently. Kentro also automatically updates your online listings whenever a customer buys or returns an item or whenever your warehouse receives new stock. Simply put, Kentro simplifies your stock management to help your business grow. Book a demo today to learn more about Kentro.