During the pandemic, supply chains and inventory management have been disrupted across nearly every industry. One way to prepare for and combat any future disruptions is to focus on simplifying your inventory management process to ensure you always have enough product to meet customer demand.
"It only takes one missing component to put an entire production line and workforce at a standstill," said Brady Maller, EVP of strategy and sales at POLYWOOD. "Try selling coffee without a cup, building furniture without fasteners or constructing a house when windows are backordered. The unusual disruption in 2020 has been the shortage in items that just a year ago seemed limitless."
If you're struggling with your inventory management, here are some strategies for staying on top of these challenges so you can keep your products moving.
Leverage the right technology
An inventory management system oversees and organizes the flow of items from the manufacturer to the warehouse and eventually to the customer (or point of sale). This technology helps businesses keep tabs on current stock levels, reducing storage costs for excess inventory and improving relationships with suppliers, vendors and partners.
Without an inventory system, businesses often struggle projecting which items move quickly and which move slowly, as well as when they will need to place new orders. Having everything streamlined in one place alleviates the pressure on the business and helps them focus on other areas of inventory management, like strengthening relationships with suppliers and addressing any customer concerns.
[Read: 6 Inventory Management Terms You Should Know]
Get help from industry specialists
According to Maureen Anders, co-founder and CEO of AR Workshop, the businesses that were most prepared for the impacts of COVID-19 were those with crisis strategies and reporting in place. She recommended working with specialists who can assist in these areas.
"Specialists who work in your industry can help set up systems to not only track and report your supply chain, but to anticipate future trends," said Anders. "Ahead of sitting down with a professional, map out time pegs that you feel are relevant to sales spikes in your business based on seasonality and previous years in business."
Armed with this information, your business will be better equipped to make accurate forecasts and maintain good communication with vendors and customers.
Develop strong supplier relationships
To stay on top of inventory, Maller recommended business owners focus on areas they have a direct impact on. For example, investing time and effort into your relationships with suppliers will not only improve your reputation as a business that is easy to work with, but also express your loyalty to your partners.
"Stronger relationships with suppliers ensures they are the partner of choice through proactive communication," Maller told CO—.
Instilling this confidence in your suppliers will provide a more solid foundation for your relationship, and you may feel more comfortable asking any questions and voicing any concerns you may have throughout your inventory management process.
[Read: 5 Things You Need to Know About Dropshipping]
Stronger relationships with suppliers ensures they are the partner of choice through proactive communication.
Brady Maller, EVP of strategy and sales at POLYWOOD
Have a customer communication plan in place
The way issues are handled in inventory management can make or break a business — especially when it directly impacts a customer or client, said Anders.
"The best thing to do in the wake of an issue is to try and resolve the problem as quickly as possible and to over communicate with customers or clients," she said. "This will help you salvage client and customer relations."
When an issue arises, business owners should immediately schedule time with their supply chain manager to discuss strategy to resolve the problems, said Anders. Additionally, businesses should make customers aware of any delays or back-orders rather than leaving them confused and waiting.
Get creative and find ways to adapt
Inventory management is not a simple process, and it looks different for every business. While changes are inevitable — especially during a pandemic — there are ways to adapt and simplify your inventory management.
For example, stagnant items or products are a common challenge for many businesses. In this case, Anders recommended business owners "have a plan in place to move old inventory, whether it be through discounts or promotions."
Additionally, Maller advised business owners to embrace their creativity to find solutions that work best for them.
"Entrepreneurs learn and adapt through all types of solutions, such as vertical integration, washable versus disposable, standardized components, domestic versus overseas and more," he said. "They are some of the most innovative people in the world who refuse to take 'no' for an answer."
[Read: Handbag Maker Hammitt Maintains Luxury Status With Tight Inventory Control]
CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.
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