One of the most important ways to grow as a small manufacturer is to streamline and optimise your inventory. But, that’s far easier said than done. Tackling this issue can take months or even years of minor and major adjustments until you find a pattern that works for your company.
To help you embark on this journey, we’ve curated a list of the best methods for streamlining your inventory. Using these tools, you can start on the path towards manufacturing simplicity and predictability.
How to optimise your inventory and streamline order management
Use KPIs and metrics
The first tool you should use to optimise your inventory is KPIs. KPIs and metrics should be your bread and butter, providing you with rich data on your most important processes.
As you work through this list, you’ll notice that you need data to act on these strategies. That’s why we’ve included this step first — because it’s the first step towards gaining control over your inventory management.
If you’re looking for a comprehensive list of the top KPIs to track, we talked about that in this post!
Identify obsolete or slow products in your inventory
Next, you should use your KPIs and metrics to identify slow or obsolete products. These are known as SLOB products (slow and obsolete), which is an easy way to remember to cut down on these products within your inventory.
This includes products with low sales compared to the rest of your inventory. Removing these products from your inventory frees up space and lets you focus on more important products. It also cuts down on costs and slow-moving inventory.
Reduce your overall number of products
Not only should you look to cut down on SLOB products, but our next tip for optimising your inventory is to reduce the total number of products you carry on the whole.
Having a large number of products might seem like a good way to hedge your bets, but in reality, it leads to a lot of SLOB products, reduces the amount of energy you can invest in each product, and can waste resources.
Instead, opt for fewer products if you can. This allows you to increase the quality and frequency of updates for each product. And it creates a better product that will bring in new customers and inspire customer loyalty.
Improve your forecasting
Forecasting is essential for good inventory management. If the last few years have shown us anything, it’s that nothing about your supply chain is set in stone. Trends come and go, and you will be left behind fast if you’re not on top of these changes.
Fortunately, there are plenty of tools (like Workhorse!) that make forecasting more manageable and more effective. You can anticipate many trends and supply chain disruptions by using the right tools and keeping a close eye on your metrics.
This will go a long way towards protecting your income, ensuring that you have what customers are looking for as often as possible.
Reevaluate your supply chain
Reevaluating your supply chain is less of a one-time process and more an ongoing practice that you should engage in routinely.
When doing this, you want to look for factors like pricing, quality of materials, routing, and more. Checking these factors and comparing them against the competition will help you be sure that you’re being as efficient and cost-effective as possible. If overlooked, you could lose out in the long term.
Spot and reduce warehouse inefficiencies
Similarly, you should be regularly looking for warehouse inefficiencies. This includes any aspect of your warehouse that is running less than optimally. And — you guessed it — to track this, you need to keep a close eye on your KPIs.
On occasion, there will be a slow spot that you can’t work around. But most of the time, you can optimise these issues through automation and reorganisation.
Reduce uncertainty wherever possible
Another important part of streamlining inventory is reducing uncertainty. We’ve touched on this a bit with forecasting, but that’s not the only area of your manufacturing cycle that can be affected by uncertainty.
Some products, including household staples like bottled water, are generally purchased predictably year-round. But others, like seasonal foods, will have changing demands over time. Keeping a close watch on these less predictable products and understanding how their demand changes will help you reduce uncertainty surrounding them.
Use a powerful inventory and order management system
Our last tip to optimise your inventory is to invest in a powerful inventory and order management system. A good inventory management system can help you with all the above tips and more.
An inventory and order management system is crucial for tracking your KPIs. These software solutions automatically track KPIs, performing extremely valuable analytics and calculations.
Additionally, inventory management software goes a long way toward automating your inventory and order management. It can perform tasks faster, with fewer errors, and without manual intervention.
Use a cutting-edge inventory and order management system to optimise your inventory
The tools and tips in this list will help you optimise your inventory and grow with confidence. And Workhorse is a great tool that can help you streamline your operations.
Workhorse is a cutting-edge, configurable inventory and order management system that provides you with all the tools you need to succeed — and none of the features you won’t use.