Keeping track of inventory control is one of the most important processes to ensure the efficiency and growth of a company, whether physical or online.
Excess products can cause losses to the business, as can a lack of merchandise, which can generate customer dissatisfaction and harm the image of your business.
However, with good monitoring of product inputs and outputs, it is possible to plan inventory more efficiently. In addition, proper control helps in company management, offering greater efficiency and organization of some of your company’s internal processes. Waste of both time and energy when managing, as well as of your financial resources, is also reduced.
If you’ve come across this article, it’s probably because you need to maintain a healthy inventory turnover and, consequently, increase your company’s profitability and efficiency. Continue reading and check out what we’ve prepared for you.
What is inventory control?
Inventory control consists of monitoring and analyzing the inputs and outputs of a company’s products, whether inputs or goods. This process ranges from the acquisition and storage to the marketing of items.
Its main objective is to ensure country wise email marketing list the adequate quantity of products in your store according to market demand.
Among the advantages of having efficient inventory management, we can highlight:
Control the entry of goods;
Monitor the output of products sold, exchanged or transferred;
Store properly;
Identify the products with the highest and lowest turnover;
Make a demand forecast;
Plan purchases and replacements more assertively;
Avoid product losses;
Optimize storage space and costs.
That’s why it’s so important to know boost your affiliate earnings how to control inventory. Whether it’s through notes in notebooks, spreadsheets or more advanced systems, inventory management can be done in several ways.
Main methodologies for inventory control
There are different inventory control aqb directory methods, which vary according to the needs of each business. Below, we highlight the most commonly used models. It is worth noting that, for the purposes of calculating Income Tax, the only ones accepted by the Ministry of Finance are FIFO and Average Cost. The other types can be used for internal company management.
PEPS: First In, First Out
This method follows the principle that the oldest goods in the inventory are the ones that should be sold first . This is one of the most widely used inventory control models, especially by stores that sell perishable items.
This method reduces the loss of goods due to expiration dates, damage or obsolescence (especially for retailers who work with trending products). It is widely used to increase inventory value, since the goods stored will mostly be those purchased last.
LIFO: Last In, First Out
LIFO is the opposite of the FIFO method, where the most recently purchased product is the first to be made available for sale .
Adopting this method requires even more efficient management to avoid loss of goods and financial losses to the business, and is not recommended for businesses that sell perishable items.
ABC curve
This methodology is widely used to identify products that generate more profit for the business. It is based on three fundamental pillars to establish the importance of keeping each product in stock: turnover, revenue and profitability.
Based on these criteria, the merchandise can be classified into 3 types:
Type A: products with high value and importance. They normally represent 20% of the stock and are responsible for 80% of the company’s revenue. They are the ones that require the most attention in stock, in order to avoid their unavailability.
Type B: medium-value and important products. They account for approximately 30% of the total available products and generate 15% of sales results. They do not require very strict monitoring, but should be monitored regularly.
Type C: These are considered the least valuable to the company. They represent 50% of the products in stock and 5% of the revenue. They do not require constant monitoring, but must be kept in small quantities in stock, ensuring that specific demands are met.