One of the most frustrating problems a big-box store can face is slow-moving inventory. Not only does it hurt sales, but it also eats up warehouse space that could be used to stock faster-selling items. If you’re a business owner or warehouse manager, getting rid of slow movers can make the difference between a dismal bottom line and a profitable one. With that in mind, there are three strategies for preventing the headache of an overstocked warehouse.
Better Forecasting
It’s possible that addressing slow-moving inventory problems could be as simple as using more accurate forecasting models. If you have a better idea of which items will sell more quickly, you can adjust how you store your inventory for peak efficiency.
Leveraging business intelligence (BI) data
Suppose you have the capability of doing a little more number-crunching. In that case, BI data can help reveal complicated supply-chain issues that aren’t so readily resolved through the use of human analytics.
Revamp marketing efforts
If you’re overstocked, your problem may lie outside the warehouse. If your competitors aren’t struggling to move similar inventory, you may have to revisit your sales strategies. Brainstorm new marketing and advertising strategies to reach your target market more effectively. Even a small shift in messaging or marketing channels can produce immediate and quantifiable results.
The secret weapon: Drop shipping
Though all three of these strategies can help you push slow-moving items, they still might not put a significant dent in your inventory congestion. In this case, drop shipping may be your most effective answer. It’s an uncomplicated yet valuable supply-chain technique that eliminates much of the risk associated with carrying large volumes of inventory.
Instead of purchasing a large amount of inventory and storing it in your facilities, you partner with drop-shipping suppliers, and list their merchandise for sale. Once you receive an order, you forward it to the supplier so they can fulfill and ship it. The drop shipper takes some of the profit and passes the rest along to you.
With drop-shipping, you only pay for the products you sell, and you don’t have to keep excess inventory on hand. This ultimately eliminates the risk of slow-moving items piling up and allows you to test new products without taking an expensive gamble. You may not want to use drop shipping for every product line, but it can be a powerful tool in the right situations.
No matter which combination of inventory-management strategies you use, you also need the right people to move that stock. If you need help getting talent for your company, contact Mega Force to request an employee.
