Taking stock of inventory management
Unless a customer has their heart set on something that you alone supply, the chances of them waiting around for one of your products to come back in stock or production are slim. Not only will you have lost a sale, but you’ll have potentially lost that customer forever if they’ve found what they’re looking for with another supplier.
So the answer is to always make sure you have plenty of stock, right? Wrong. You need to make sure you have an adequate amount of stock waiting in wings, as a surplus can lead to other problems.
If you have a backroom brimming with stock, you will have additional hazards on your hands – fires and falling boxes, for example. Your once on trend item could quickly become obsolete as consumers change their view, or it could be left to spoil. All the while there is more stock to be damaged or stolen – merchandise or materials that are tying up your capital, and threatening never to give it back.
The answer? A coherent inventory
A control system that allows you to see what’s been sold or used, while tracking sales activity to monitor what stock needs ordering when, means you can be fully prepared for your customers with just the right amount of stock. This could be complete sellable items, or the raw materials used in the finished article if you’re a manufacturer. It can prevent delays, lost customers, increased risk and locked down capital.
An inventory can be as simple as a notepad with pencilled-in columns filled with detailed stock and transaction information. However you can make life easier on yourself and your employees by using money saved on stock bloopers and investing in inventory software. Automation lowers the chances of human error, reduces paperwork, and means essential information is easy to share.
Backing up with insurance
An inventory is going to be incredibly useful if you’re trying to work out what level of insurance protection you need for your stock. Instead of rifling through boxes and counting crates, you’ll simply be able to check a figure on your list. This means you’ll avoid underinsuring your stock, or paying more than necessary.
Shop insurance policies cover stock alongside contents, and often have allowances for seasonal stock increase. If you’re a manufacturer or construction company, those raw materials used towards the finished product can be covered with a dedicated policy too.