It can be tempting to stock a warehouse with as much inventory as possible to meet customer demand. However, taking the easy way out is sometimes the most efficient or cost-effective option. Keeping the right amount of stock on hand can take time and effort, especially if you have much to keep track of. Fortunately, there are several ways that print on demand fulfillment can assist you in making informed decisions about controlling stock to better manage your ecommerce supply chain and meet demand continuously.
WHAT IS STOCK CONTROL?
The process of optimizing stock levels in a warehouse to stabilize inventory storage costs while maintaining enough stock to meet customer demand is known as stock control or inventory control. Proper stock control, when done correctly, can reduce logistics costs while ensuring you always have just enough stock on hand. However, you will need access to tools and data to make better predictions on supply and demand to control stock.
4 DIFFERENT STOCK CONTROLLING METHODS
1. EOQ (economic order quantity)
The economic order quantity (EOQ) method determines the optimal order quantity to obtain from your manufacturer to reduce costs and maximize warehousing space. This method, also known as “optimum lot size,” can assist you in making better decisions about how to avoid stockouts, how much safety stock to keep on hand, and when it makes the most sense to order more inventory. Moreover, the EOQ is calculated using holding costs, annual demand, and order costs.
2. Vendor-managed Inventory (VMI)
The VMI method entails delegating the ordering and restocking of inventory to a third party. In addition, the vendor manages and owns ecommerce inventory and the risks associated with doing so. You pay for the stock only after it has been sold, and any unsold stock is returned to the vendor. As a result, it allows businesses to worry less about inventory control because it is handled by someone else.
3. Just-in-time (JIT)
The JIT inventory method entails ordering as much stock as needed to meet customer demand, but it also necessitates the ability to order quickly to meet the next batch of orders. This stock control method is specifically designed to reduce inventory carrying costs, increase efficiency, and reduce waste. This can be achieved by only purchasing stock that will sell sooner rather than later. To use the JIT method, ecommerce businesses must be able to accurately forecast demand. In addition, they need to access real-time stock levels or risk a high volume of stockouts.
4. FIFO (first in, first out)
According to the FIFO method, the first batch of inventory that arrives in the warehouse must be sold and shipped out first. It makes it simple to calculate inventory costs and values despite changes in supplier pricing. Furthermore, this method selects and sells batches with the most recent manufacturing or receiving dates first. Using FIFO, any inventory remaining at the end of the fiscal year does not affect the cost of goods sold (COGS). However, it can cause some inaccuracies in inventory accounting. It also does not provide any tax benefits.
TOP PRINT ON DEMAND TIPS TO IMPROVE STOCK CONTROL
1. Understand your stock levels.
To improve stock control, you must pay close attention to stock trends. In addition, knowing which items move slowly versus quickly and are replaced in a specific period can help you make better decisions about when to restock. The inventory turnover ratio is a great tool for determining the best time to order new stock and how much to order per SKU.
2. Look for ways to improve your supply chain.
Stock control is only one aspect of supply chain planning. It is always important to seek opportunities to optimize your supply chain to manage logistics costs and efficiency. Implementing technology and automation tools is one of the most effective ways to create an efficient supply chain. As a result, many direct-to-consumer (DTC) brands purchase an inventory management system to gain access to data and analytics.
3. Consider inventory optimization tools.
Inventory optimization tools are critical for better stock control, particularly as businesses seek better ways to evaluate their entire network. In addition, they us it to determine the best methods for each product at each stage of their supply chain. These tools are typically standalone applications that use data from WMS and ERP systems. These tools consider supply variability, demand variability, and replenishment parameters to determine how much inventory should be kept to protect against that variability. As a result, these tools have become popular as more businesses recognize the value of cutting-edge optimization capabilities.
4. Maintain a relationship with your print on demand service provider.
Your print on demand service providers are business partners, and maintaining an open line of communication with them will allow you to provide goods to your clients at the price they desire and within a reasonable timeframe. If you have a good relationship with a print on demand company may alert you to potential shortages and assist you in finding solutions to meet customer demands. You should aim to build a long-term relationship with your print on demand fulfillment partner rather than just getting the best price.
5. Resolve problems on time
When you monitor inventory regularly, you can identify problems before they become serious. Moreover, to improve your stock control system, resolve any issues as soon as they arise. You must always be aware of how much you have, how much you owe, how much you will receive, and whether you need to place additional orders. Furthermore, keeping track of these details will allow you to maximize business profits.
Managing your stock effectively entails determining which products are popular with your customers and which are not. Tracking your inventory and analyzing any data related to the products you sell and those you don’t will become increasingly important as your business grows. In addition, it can be accomplished with the help of inventory management software. It will assist you in preventing risks from impeding your ability to run smooth operations and meet your customers’ needs. Furthermore, you can access inventory management software and more by partnering with a print on demand service provider.
Fulfillplex is invested in the success of our clients. Our experts will provide you with solutions to your fulfillment issues. We offer real-time inventory management, print on demand fulfillment solutions, ecommerce fulfillment solutions, and fulfillment markets. Working with a top ecommerce fulfillment company that manages your warehouse with high-quality software systems has numerous advantages. Contact us here.