Do you feel you understand your business? Do you understand the demands you face and have a sense of changes that may be on the horizon? Does your business keep pace with the competition? Do you have a grasp of general market conditions?
These types of questions and what-if’s can overwhelm a business, but by keeping a pulse on the market, you can see your business more clearly and plan accordingly.
Let’s cover some recent findings and numbers that can help inform your business, and guide your warehouse.
US-based retailers store $1.43 in inventory per $1 of sales made
(Marketing Alternatives, Inc)
Covid did a number on us, and we’re still working through its economic consequences, with lingering effects showing in inventory-based businesses overstocking their items to meet any sudden surges in customer demand while pre-empting the dreaded stockout.
How does this affect your business?
Overstocking is a complicated factor for businesses, and excessive buying simply ties up cash , leaving capital unavailable for any other uses. Businesses will always need investment, like investing in efficiency or inventory solutions.
Overstocking also carries the potential risk of loss due to product aging and the associated risk of shrink due to product expirations, not to mention the increased costs of controlling and managing additional inventory.
Inventory on-hand has increased by 8.3% over the last five years
(Supply Chain Digest)
Another perspective of the capital tied up in goods is reflected in the total inventory that businesses keep on-hand. Statistics have shown that reducing stock-outs and overstocked items can lower the overall cost of inventory by up to 10%, which represents a significant amount of capital for any company.
How does this affect your business?
We’ve already covered that capital tied up in inventory reduces investment in other areas of the business, but we need to also consider the additional costs lost to extra labor, extra storage, even extra work capacity for those in your warehouse. You only have so much space, and it needs to be utilized wisely.
73% of warehouses plan to use mobile inventory management
(Valu Track)
Mobile Solutions are becoming increasingly important in speeding up warehouse processes while also reducing the errors that are common to managing large volumes of items.
How does this affect your business?
Failing to update your business and its warehouse operations with mobile devices could potentially leave it more susceptible to out-of-stocks and other errors, which would in turn reduce productivity and customer satisfaction.
Total U.S. warehouses is up by 6.8% in the past five years
(Statista)
The world-wide pandemic taught businesses some hard lessons, one of them being the importance of having reliable supply chains, which is now being met by a growing number of “local” suppliers and vendors. We live in a global market, but we also need home-grown solutions.
How does this affect your business?
Your supply chain is the lifeblood of your business, but what if one of your vendors can’t deliver? Or what if your customers rely on your business as part of their supply chain? How can you find greater assurances?
Find other potential vendors while also providing the least amount of friction for your own customers, from better shipping, better communication, even better sales through B2B Sales Portals. Find your exposures, and tighten up.
Barcode Technology reduces human error by 43.5% percent
(National Center for Biotechnology Information)
A recent study conducted on dispensing medicine in conjunction with barcode scanners showed a substantial reduction in human error rates when it comes to order transcription, medication administration, and even potential adverse drug events.
How can this affect your business?
When it comes to the health of your business, data consistency is key. Too often businesses get away with bad data habits because they’re small enough to make a significant impact. But as business grows, those unchanged habits become big headaches.
Barcode Technology, like 2D barcode scanning and 2D Barcode generation, are small contributors to long-term data and healthy business.
Item-level tagging can increase inventory accuracy to up to 95%
(PR News Wire)
We’re not done with scanning just yet; RFID tags, particularly those used to scan and track inventory and supply chain management, can provide a constant eye on every movement in your operation.
These RFID tags, along with similar sensors and scanners, have the same goals: reduce error, reduce stockouts, and ensure accurate data.
How can this affect your business?
Can your company track its entire supply chain? If not, where does the breakdown occur, and what is it costing you? Isolate those areas, evaluate which can provide the greatest ROI, and systematically work through them.
US retail businesses have an inventory accuracy of just 63%
(PR News Wire)
Imagine holding a business meeting with all the relevant stakeholders to announce that you cannot account for nearly 40% of the inventory at any given time. No one would call that a victory, but thousands of companies operate within this unaccounted reality everyday.
How can this affect your business?
Get inventory control, and then manage it.
Inventory control pertains to the levels and order points necessary to operate a business, and often include incorporating inventory systems and software.
Inventory management speaks to how you move and handle the inventory for your business processes, and will further involve inventory solutions that can specialize to your businesses specific needs, like the ability to create pallet orders or tie into eCommerce carts.
34% of businesses ship late due to selling out of stock items
(PEOPLEVOX)
We’ve covered the downfalls of excessive stock, but the flipside brings its own disadvantages. The inability to meet a customer’s expectations creates poor buyer experience and often loss of future sales.
How can this affect your business?
The goal of an inventory process is to be efficient and automate as much as possible, which is why most inventory software includes features like an auto-reorder point that triggers when stock dips below a set threshold.
But what does that have to do with your business? To illustrate the point that for every inventory issue, for every stock screw-up, there are processes and solutions designed to tackle each one. Those solutions can even begin with a simple consultation to get ahold of the big picture, to then create a plan for moving forward.
Takeaway
Your business may be dealing with many of the common warehouse and inventory problems of other businesses your size, don’t let them stay that way. By keeping an eye on market trends, and comparing those numbers to your own, you will find insight for improvement.
If you’re business needs to improve its inventory, and you want experienced solutions, get started here.