As we navigate through the COVID 19 pandemic, companies have had to take a hard look at their inventory management systems. Timelines, trimming costs and smart inventory control are the hallmarks of a business with remarkable profit margins in the post COVID world.
Here are 10 most common inventory management problems that a business may face and tips on how you can solve them
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Need for supply chain transparency: End-to-end supply chain visibility is key to maximizing efficiencies and your future risk management efforts. Businesses must map their business processes, from concept to customer, to be in control of timelines and make more educated situational pivots.
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Missing the bigger picture: Data intelligence is important at every stage of your business. From marketing analytics to inventory quantities to profit margins, all information is important. Supply chain data and context is most of the times ignored as insignificant, but overlooking supply chain data is a big mistake. Make sure you’re utilizing supply chain data appropriately to make wiser business decisions.
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Not accounting for business disruptions: Not having pivot plans in place is a sizable risk towards running a smooth business. When the inevitable happens, you will be prepared to keep your customers from being affected. Pandemics like COVID 19 are an eventuality and as much must be factored into processes as much as possible.
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Choosing too many partners: Although you want to be prepared, there is such a thing as having “too many cooks in the kitchen.” Too many vendors introduce more complexities to processes. Investigate and find your right balance. Data is going to be your savior in finding the sweet spot and choosing the right partners.
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Going lean without supporting infrastructure: COVID 19 has forced businesses to go lean. Here is the dichotomy, lean is good, but being too lean can cause issues. Granted, going lean is desirable to save costs, however going lean without the right systems in place can cause disruptions and bottlenecks to an otherwise smooth operation. Make sure you have the right processes and systems in place to support going lean.
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Lack of proper security protocols: In 2021, ransom-ware & phishing attacks are an eventuality. You must have proper processes and systems in place for a) avoiding getting infections in the first place b) recover with minimum disruptions in the event of an infection. The number of businesses that we see without a coherent strategy in this department is too () high.
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Lack of optimized business processes: Understanding what comes before AND after your business is crucial to optimizing your supply chain and business plan. (After all, loss of revenue can occur when a customer returns a product.) Prepare for this with a supply chain that is optimized from concept to customer, and beyond.
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Not aligning application design to a business strategy: If your supply chain is only aligned with one specific type of business, it will be difficult for you to acquire or change to other products or businesses in the future. Understand your long-term growth plan, and align your supply chain for now and the future.
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Not creating effective vendor relationships: Yes, price is definitely important when choosing a supplier. However, employee relations and customer service also are important. Finding someone who is willing to be a partner is much more beneficial to your overall business than a few pennies saved.
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Operating in silos: Organizations that operate as networks operate much more efficiently than organizations that operate in silos. Make sure your teams are collaborating with one another and are customer-centric in their approach. The right combination of business suites will make all the difference.
Have you faced any challenge from this list?
Do you think we missed something?
Want some guidance on how to solve any of these challenges?
Drop us a line, we’d like to help.