Best Inventory Management Techniques

inventory management, Hypley
inventory management, Hypley

The best inventory management techniques for hire or rental business:

  1. Keep An Eye On Your Inventory, ABC analysis.

  2. Automate Your Inventory Management.

  3. Forecast the inventory demand.

  4. Forecasting methods and techniques.

  5. Always keep a look out for hidden problems.

  6. It’s Your Decision.

Managing your inventory is everything, whether you are small or large rental business.

Proper inventory management is what makes or breaks businesses. You have to follow these techniques to lead a successful hire and rental company.

Cloud software is a cost-effective alternative to outdated systems and offers everything you need. Rental cloud software can provide you with tools and information necessary to streamline your business, increase productivity and profit margins. It isn’t a must but you may not reap all the benefits.

5 inventory management techniques for your small business

1. Keep An Eye On Your Inventory

Keeping your inventory level in sync can be a hard task. Every second finding out if you have an item in stock contributes to a customer looking elsewhere. Even worse, you tell them you do and realize you don’t.

To identify your rental inventory needs, your business can use a inventory management technique known as ABC analysis that provides a mechanism for you to identify and categorize each rental separately. ABC analysis is an inventory categorization method which consists in dividing rentals into three categories.

  • Category A: Rentals that are high in value but low in quantity
  • Category B: Rentals that are moderate in value and moderate in quantity
  • Category C: Rentals that are low in value but high in quantity

2. Automate Your Inventory Management

Talking with a lot of small business starting out, we found out they are still using Excel spreadsheets and other manual inventory management techniques.

“43% of small businesses still do not track their inventory or use a manual process to do so.”

These techniques can take up time and are not designed for your task. If you want spend more of your time making sales, talking to customers or doing things that scale you need to look into Cloud-Based inventory system. 

How Automating helps your business.

Spending any extra spare hour you have manually analyzing data pulled from disparate systems and multiple locations is most certainly not scalable for business nor your personal well-being. And as your order volume grows, all of these stale “systems” you’re running today will break–it’s just a matter of time.

Spending any extra spare hour you have manually analyzing data pulled from disparate systems and multiple locations is most certainly not scalable for business nor your personal well-being. And as your order volume grows, all of these stale “systems” you’re running today will break–it’s just a matter of time.

Developing a scalable rental business model depends heavily on the systems you’ve enforced. Manually getting into inventory in spreadsheet documents isn’t scalable . Emailing and calling your staff to work out what quantity inventory you have on hand also isn’t scalable .

Spending any further spare hour you’ve got analysing knowledge from multiple locations is most in no way scalable for business nor your personal well-being. As your order volume grows, all of those stale “systems” you’re running these days can break–it’s simply a matter of time.

If you would like to scale your business, taking the time these days to maneuver to automation-driven systems can change you to assemble info quicker and create smarter decisions for the long term.

3. Forecast the Inventory demand 

One of the important things for a hire and rental business is the capacity of forecasting. When you and your staff can predict your business inventory requirements, you gain control over your operations and can even anticipate your customers’ demands.

Many big businesses get into trouble with this particular problem, especially because companies often lose sight of their stock, which ends up costing them money and resources.

Your forecast capacity should factor into historical sales trends, seasonality, and economic climate. In a nutshell, you need to stay on top of both your rental stock and your client’s needs, so you don’t hold either an excess or insufficient inventory to minimize the financial impact on your business.

A good technique is to never stock more than 1.5 times your turn rate during a delivery cycle.

4. Forecasting methods and techniques

There are four forecasting methods and techniques, some of which can be used simultaneously. Mainly, though, forecasting can be broken down into four main types:

  • Qualitative — Is forecasting as an estimation based on expert judgments rather than numerical. This relies on the knowledge of experienced employees for future outcomes.
  • Time series- Anaylsis is extracting meaningful statistics and other data. Then using it to predict future values based on previous values (purchase behavior)
  • Causal– “Estimating techniques based on the assumption that the variable to be forecast (dependent variable) has cause-and-effect relationship with one or more other (independent) variables.”
  • Simulation– forecasting is the approach where all methods are mixed together. It accounts for both qualitative and quantitative insights to provide a more holistic outlook.

However, this is also arguably the most complicated forecasting technique to DIY, because of its complicated nature. Simulation also accounts for internal and external factors — those elements identified in your causal forecasting.

5. Always keep a look out for hidden problems

Rental management systems offer accurate reports to help you analyse problems with your inventory.

Inventory management systems help you track your workflows and identify weaknesses in the process, enabling corrective action to be taken to fix the underlying issues in your inventory management.

That way, when you have to make business decisions, you can be entirely informed about both your performance and your problems so you can play your strengths and minimise your losses.

6. It’s Your Decision

Your rental/hire business relies on your inventory, for that reason you need to manage it properly to succeed.

Take a few minutes out of your day and analyse your business and the way you manage your inventory.

Here’s one final inventory management technique to take with you: Whether is a new employee or suppliers. The state of your inventory depends on you having open communication with your team and support them as much as you support your customers.

Do you have any inventory management techniques you’d like to share?

 

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inventory management, Hypley
inventory management, Hypley
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inventory management, Hypley