+2712 88 00 258
KB20200519/02: Sage 200 Evolution Tip & Trick – How to Improve Inventory Management
Loss of sales and escalating costs make poor inventory management a major problem.
Not having enough stock results in stock-outs. Orders come in, you don’t have the items the customer wants, and then a scramble ensues to expedite higher-priced replenishment. Even worse, you may lose the sale to a competitor who has the desired stock available. Stock-outs carry opportunity costs: the opportunity to sell at the best price and the opportunity to sell at all.
On the other hand, holding excess stock carries costs because the inventory you stock has to be warehoused, insured, secured against shrinkage, depreciated and taxed as an asset. Excess items generally cost the business an additional 25% to 50% per year. Excess stock carries opportunity costs as well: The working capital tied up in unsold inventory is unavailable for other purposes.
Improving inventory management requires improving command of your warehouse operations and the physical stock inside it.
Here are four things you can work on right away that will improve your inventory management:
