“Social distancing” and “flattening the curve” weren’t the only words and phrases used with abandon during the pandemic. Another was “supply.” While not new to the lexicon, supply was a major buzzword largely because there simply wasn’t enough of it throughout the crisis, as grocers, big box retailers, furniture sellers and more struggled to keep up and restock on pace with the rate of buying among consumers.
Fast forward to today, supply has normalized, but inventory has piled up, as business owners overestimated the degree to which demand would remain elevated in a post-pandemic world.
Changing world, consumer and economic circumstances have forced product-based industries to restrategize and exercise proper inventory control. Here, we’ll briefly discuss what inventory control is, how it differs from inventory management and tips for how you can improve your inventory control.
What is inventory control?
Inventory control is a business activity that involves accounting and tracking the inventory that currently exists in your back rooms, factories, warehouses or distribution centers. This means understanding every aspect of what’s there, including how much exists, where it is (specifically), its overall condition and when it arrived.
How does inventory control differ from inventory management?
On the surface, it would seem that inventory control and inventory management are synonymous. While they are often used interchangeably, these two business processes are distinct from each other. The key difference is timeline. Whereas inventory control is all about the inventory you now have, inventory management keys in on what you will need. In other words, inventory management is more forward looking and predictive, while inventory management is in the moment.
4 best practices for successful inventory control
1. Have a ‘home’ for merchandise
It isn’t enough just to have inventory or know you have specific items in stock; you also need to know where it is so it’s easily locatable. Having a home for merchandise applies both to inventory that has yet to be sold as well as what’s available for purchase and out on the floor. If items aren’t moving as quickly as you’d like, it may be wise to move them to an area where they’re easy to spot or one that customers are guaranteed to walk by, such as an entrance or exit.
2. Prioritize identification
No inventory control system can succeed without a way to identify what’s in stock. But instead of using serial numbers, which can be easily misinterpreted and are prone to errors in recording, it may be wiser to use labels. Just ensure they’re large, the descriptions are legible and the names used for each product are both logical and to the point.
3. Count carefully
In any pursuit, be it in business or life, how you finish often depends on how you start. That’s certainly the case in inventory control. Make sure the physical count of your inventory is correct and accurately reflects what you actually have. Also, aim to use the same units and measuring system to ensure consistency and avoid misinterpretation (e.g. grams, gallons, kilograms, pounds, number of pieces, multiples of 10, 100, 1,000, etc.).
4. Ensure goods are easily traceable
Inventory control also includes merchandise that is in the process of arrival or already in the pipeline but has yet to be delivered. Whatever stage items are in — in-transit, backordered, out for delivery, etc. — they need to be fully traceable. Product lifecycle management software and enterprise resource management software often feature location tracing solutions.