Warehousing 101: Managing Your Inventory
As EstafetaUSA continues to offer customers warehousing services, our experts wanted to provide you and your team some education about Warehousing 101! As the leaders in providing full warehouse management for you and your company as they ship to Mexico, we’re devoted to educating our customers on the best ways to warehouse and keep your profits rising. EstafetaUSA has been offering everything from everyday management, to pick and pack forwarding, to simply helping your warehouse team navigate customers, with an eye on making sure your packages navigate safely and securely through Mexico. Our dedicated warehousing team, perfect for companies both big and small who have a continual need to serve customers in Mexico, have a big recommendation for these companies; know how to inventory!
Companies, big and small, have to quickly learn about inventory and what it means to them and their timeline (and bottom line.) We are happy to share our logistics knowledge to help businesses across the world streamline their shipping methods, no matter their level of experience with shipping. We know that inventory is one of the most crucial aspects of successful logistics and want to help professionals of all levels improve their operations with it. Using these five methods, your business can maintain a consistent inventory without going out of your way or budget.
Set par levels
In most things, your aim is to be consistently below par. In shipping, “par” refers to the amount of inventory on hand (typically an amount designated by the purchasing department) at all times, and it’s an important level to be consistently at or above. By remaining at levels close to par, you are able to satisfy all customers and escalate sales without losing money on storage space for extra goods or risking spoilage of goods. It is also important to note that your par level may change as your business grows or trends emerge, while it may be a fluid metric at times it is important to have recorded for efficiency.
It’s one of the rules of business and life; finish the task at hand before starting something new. By utilizing a First-in-First-out method, you can reduce potential spoilage and avoid packaging damage as much as possible. While the ideal situation is to always sell your exact inventory amount, this is rarely a perfect science which means that sometimes items have to wait on the shelf until the next round of shipments. You need to minimize loss caused by those scenarios and maximize profit. The answer is as simple as selling oldest stock first and rotating product. Whether this is done manually or communicated to your warehouse staff, this crucial concept could save you significant amounts of spoiled or worn goods later on.
If you’re managing your own inventory, regular auditing it key in monitoring your product. By setting aside time to do a full inventory, you are able to update your product amounts and evaluate if your current tracking method is effective. If you find that your original numbers were far off, it may be time to consider inventory management methods that are automated to avoid human error. By allowing time for regular stock audits your business is forced to evaluate its methods and ensure that they are functioning as planned. Additionally, it can provide a written record of seasonal trends that can be used for training and forecasting of inventory. Audits aren’t a continual system but rather regular check-ups, they take time and man-power meaning it isn’t sustainable to do daily.
Perpetual Inventory System
In between regular auditing, it is important to have a perpetual inventory or real-time system that allows you to have constant updates on stock levels. This means keeping track of what is going out of stock and what is being reordered at all times, it can be an automated system or kept track of manually with very careful attention to detail. It is from this data that you are able to determine how close you are to your par levels, and how much of each product needs to be ordered to maintain balance. A system that can run continually is ideal as it allows you to manage details that are more variable while also providing the information needed for operations. Likely, your warehousing partner has systems in place to manage this for you and provide you the metrics needed but you may need to request it otherwise.
By keeping meticulous data throughout the year, you are able to forecast future trends and prepare for them. While it’s natural to know what your busy seasons are, by getting in-depth with these results as well as cross-checking them with events, trade shows, or marketing initiatives that your company ran, it could mean data was left on the table that needs to be accounted for. By isolating this data and putting it to use, you can increase company efficiency and reduce cost without it having been replicated yet. For more common events, such as gifting holidays, you may be aware that you need triple the amount of normal inventory but it is important to write down exactly what amount to increase and when so it can be duplicated, as well as to detail which products.
Inventory and warehousing can be looming terms that are often feared and not fully understood. EstafetaUSA is proud to help businesses across the nation by managing and regulating their logistics needs. If you aren’t to that point yet, these methods will make a significant difference in your overhead costs and operations but we are always here to help.