Are you wondering why should you invest your money and time into making handmade products that haven’t been sold yet? Do you have any idea how important your inventory is?
Your inventory is your business’ asset that is a factor when planning and staying within budget. That being said, you should manage inventory record effectively to avoid problems and business mistakes.
1. Less Stock
One of the worst things you can do in business is to not have the item when your customer is ready to pay for it. This situation is called “Stockouts”. This will not only cost you money from missed sales, they can also make you lose customers for good, as customers turn to other businesses that can readily satisfy their needs.
2. More Stock
On the other hand, when inventory isn’t managed well, you might also deal with too much stocks. This is called “Overstocks”. If your products sits unsold in inventory, the greater the chance it will never sell at all, meaning you’ll have to sell it off in a low price or no profit at all, just to get back your capital.
Products are not always in style or become out of season. Some of them perish and products that stay in storage get expired or stolen. And excessive inventory has to be stored, counted and handled, which can add ongoing costs.
Inventory and Stock management helps in keeping up a trade-off between conveying costs and requesting costs which comes about into minimizing the total expense of stock. If you want to manage your stock easily, purchase the right inventory software for your business or list your inventory carefully using a personalized inventory excel sheet.
Understanding what you have, where it is in your storage, and when stock is going in and out can help lower costs, speed up fulfillment, and prevent fraud.
Check this video by Olivia Hayward to learn more tips and know the importance of inventory:
If you have additional tips or questions on inventory management, please let us know in the comments.