Stock control measures, mistakes, and how to fix them
Small businesses and start-ups face a lot of issues that other larger, and more established companies may not, and one of the biggest is properly managing stock control measures.
Many sources quote that small businesses are destined to fail if they are unable to coordinate inventory control measures adequately, some sites even list this as the top reasons businesses tank. Despite this staggering statistic, there’s still a high number of startups or small businesses that don’t establish systems to manage their inventory or warehouses.
Like any other aspect of business though, this problem can be avoided – even eliminated – if stock control measures are taken and your company learns how to recognize these issues immediately.
Stock control measures and mistakes
Some of the most significant mistakes companies make when making stock control measures, are listed here:
Measuring performance comprehensively with stock control measures
How are you supposed to know how well your business is doing if you do not measure your performance? How can you narrow it down to one way to measure it? The good news: You don’t have to! There are many ways to measure your company’s performance, and it’s important to figure out which way works best for you.
- SCENARIO: Where are you falling behind?
Maybe it’s obvious your company’s performance is lacking – but if you can’t figure out how or where you’ll never be able to adjust or rectify the issue!
As an example: One of the most overlooked aspects of businesses is customer satisfaction. Are you listening to what your customers are saying? Try it! Let that be one of the ways that you affect change in your business. Feedback from customers is honest and one of the best ways to gauge where you may be falling short.
Start thinking of all the aspects of your business. How quickly does your inventory turn? Are your fulfillment rates still good? These are key measures of your performance! Consider investing in customer service reports or quality control team members. These are standard features offered in warehouse management systems and stock control measures.
Forecasting Future Failure
No, we don’t mean a weather forecast. The failure to predict future trends and fads in your market can be the biggest downfall to successfully managing stock control measures. If you’re not keeping track of what’s hot and what’s not, you’ll be unable to prevent excessive (or event insufficient) products in your inventory.
What if you run out of stock of a popular item? It can cost you capital, profit, or even a key client! But forecasting for the future isn’t just about staying stocked with trendy items. It can also help ensure you’re not overstocking inventory that won’t sell. If you tend to stock product that doesn’t sell, it can sit on your shelves. It’ll take up space, cost you money, and even cost you an arm and a leg in property tax, insurance costs, or loan interests.
- SCENARIO: Communication is always key
You’ve heard it said one million times, and as always, it’s true. External communication is key to running successful stock control measures.
Are you talking to your customers about what their needs are? No? We suggest you jump on that as quickly as possible. Your customers are your bottom line, and if you’re not hearing them out, how are you able to know how successful and on-point your inventory purchasing orders are?
Failure to evaluate this means a hit to your reduction in inventory cost, but (maybe) more importantly, unhappy customers.
- SCENARIO: It’s all too much & overwhelming
Where on earth do you even start? Do you know what ‘forecasting for the future’ means? Then consider a warehouse management system! Most of them are equipped with forecasting tools that evaluate your inventory, assess your needs and create measures on sales, history, current and future inventory.
These forecasting tools can even keep you in the loop on what’s trending in your market, what’s working for your company, and what’s not!
- SCENARIO: Leadership is lacking
So what do you do if technology and knowing the latest software isn’t your game? While we always suggest tapping into technology yourself, it might be better to hire a manager or two you can have on hand to not just manage your software, but personally analyze sales, future trends and on-hand stock.
Employing the unqualified
Hands-on help can benefit you, but sometimes, unqualified and inexperienced employees can slow you, and your stock control measures down even further. The biggest expense for a company is the employee group that manages it, so it’s vital you hire the correct people for every position. Spend the extra time to make sure you’re picking the right people!
- SCENARIO: Sluggish and Slow Employees
Hire well so that you aren’t forced to hire often. It’s important that you consistently strive to hire warehouse managers with skills-specific education. With all the new technology, methodology and challenges that arise in warehouse management, you need to know you’ve got trusted, trained employees working where it counts! Pick the people who can not only recognize an inefficient warehouse but come up with creative solutions to pick up the pace.
- SCENARIO: Miscommunication = Missed Opportunity
Any mishap – think mistakes – in an inventory situation can be utterly disastrous. Not only can it cause organization chaos, but it can also cost your company millions of dollars. To fight this, consider using automated warehouse management systems for your stock control measures – this will allow visibility and accountability. Most importantly, train your trusted employees with this software so they can make sure it’s running efficiently and correctly.
Automate everywhere you can
Let’s face it, your warehouse should be automated. Not only that, you should have an inventory management system that keeps your warehouse user-friendly and intuitive. Spending valuable resources on software and programs and then not having the employee know-how to make them work right is a waste. Don’t fight your system. Invest in an automated software and system, and then spend the time to make sure you’re doing it right.
- SCENARIO: What does Automation even mean?
So, you’re a successful business owner, but the tech-talk has got you confused. We’re here to sort it out. Automation helps keep everything straight. It tells you about reordering points (the minimum and maximum levels in your stock room), it helps limit customer fraud with built-in control reports, and it allows multiple users to access real-time inventory info.
Not just that, but you can customize your system to work specifically for your type of business, helping reduce your inventory and stockroom mistakes, keeping you 99 percent accurate as often as possible!
Failing to manage inventory checks
Inventory checks should be mandatory for your business, but how do you know how often to run them? Can it be damaging to do them too often? Depending on who you talk to, you’ll receive different answers, so how can you know what’s best for you? You can find a good balance with trial and error and analysis from stock control managers.
- SCENARIO: Annual Audit Time
Don’t panic: Audit isn’t always a scary word. In fact, it’s an important concept for your business! In the past, you had to shut down shop to audit and thereby lose sales. Now, you can cycle through audits continuously in small, sectional shifts. In other words, no more apocalyptic-size shutdowns for full warehouse audits. This means less downtime and more time making valuable sales, all while keeping your warehouse as organized as possible.
Sure, when you think about stock control measures as a whole, it can be daunting! But by familiarizing yourself with some of the most common issues, as we’ve done above, you’ll be better able to run an organized, efficient, and successful warehouse and inventory management system. Which, in the long run, can help your company operate smoother than ever!
Talk to an expert to take that step to a smooth running, successful warehouse and IMS.