Retail inventory management is essential for ensuring that stores and ecommerce sellers carry merchandise that shoppers want without running out or having too much on hand. It also helps reduce costs and improves profits.
Effectively managing inventory involves tracking the location of products in transit, storage and store shelves. It requires regular reconciliations to ensure that inventory records are accurate.
Inventory analysis and forecasting
Inventory analysis and forecasting are crucial but often overlooked aspects of retail inventory management. These techniques give retailers insights into future customer demand, enabling them to fine-tune supply chain processes and improve efficiency. They also allow them to avoid stockouts and maximise profitability. Retailers use quantitative methods to predict the amount of inventory they should buy from suppliers and to track sales trends, seasonality, and external factors.
The simplest way to perform an inventory forecast is to enter sales data into a spreadsheet and look for patterns. It can be done with a simple trend analysis or more sophisticated methods, such as regression or time series analysis. These models consider historical data, planned promotions, and other external factors to predict inventory requirements accurately. Retailers also rely on qualitative methods such as ad-hoc and heuristic analyses to gather insight into future trends.
Forecasting is a complex task that requires a blend of data from internal sources and external factors such as market conditions, weather events, and legislation changes. It also involves some guesswork, but the more data you have to work with, the more accurate your predictions will be. Regardless of your chosen method, it is essential to review your forecasting process’s results monthly and make adjustments as necessary.
A solid grasp of inventory management is essential to running an efficient business. It is critical to keep enough items in inventory to meet demand but not so much that your company bears the cost of excess items, such as storage and transportation costs. It’s also important to know where your inventory is, how it’s tracked and accounted for, and how to replenish your stock before you run out of popular items.
Advanced retail inventory management AU software like SkuVault will help you improve your business performance. It will help you track your inventory, record each item’s location, and ensure your shipments arrive on time. Implementing a loss prevention programme will also help you minimise shrinkage and combat stock loss.
Inventory management software
The right inventory management software can save retail business money in several ways. For example, it can help you avoid over-ordering products that will sit on the shelf and depreciate or expire before they are sold. It can also help you determine when to reorder a product based on its sales history and current demand. Finally, it can streamline different stages of the order fulfilment process, such as shipping.
The best retail inventory software is simple to use and offers a range of features. It should allow you to track your stock levels and sales performance, manage multiple warehouses, and integrate with your accounting and POS systems. It should also provide reports on inventory movements, supplier analysis, and financial summaries. Additionally, it should be able to track serial and lot numbers for complete traceability.
In addition, the software should allow you to group catalogue items according to their product line or functional type. It should also let you see suppliers’ pricing for a quick comparison. In addition, it should support various shipping methods and integrations with e-commerce platforms.
When choosing inventory management software, consider the size of your business. A small company may need a simple solution that integrates with its existing systems, while a more significant business will likely want a more comprehensive option. Consider whether it can be accessed from anywhere with an internet connection. This flexibility will be helpful if you have multiple locations or sell your products online.
Some inventory management software is compatible with various devices, including smartphones and tablets. It means your employees can access it even when on the go. It is also essential to ensure that your chosen system can be scaled as your business grows. Having to reenter data manually can be costly.