Three Inventory Management Tips to Reduce Retail Costs

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The COVID-19 pandemic has irrevocably altered the e-commerce environment. As a result, new market demands are straining retail supply chains worldwide due to strong digitalization and the exponential expansion of internet shopping. One demand, in particular, is implementing a more efficient order fulfillment strategy, which requires reviewing your warehouse processes. As a result, the role of inventory accuracy and stock management services grows in tandem with the expansion of international trade and the retail sector.

The increasing strain of e-commerce orders and inventory inconsistencies is proving to be an expensive issue for firms. Furthermore, more purchases equal more transactions, which increases the possibility of a supply chain disruption. That said, inventory integrity is becoming increasingly important for retailers to optimize operational expenses.

How to reduce costs with better inventory?

Inventory strategy

First and foremost, it is critical to examine what is going on at your warehouse location. Is the space being used in the most efficient way possible? What does the order picking procedure entail? Do you self-store, or do you hire a warehouse service provider? Small firms may find it challenging to store inventory in their area because it is difficult to implement automation and efficiencies. So it’s worth considering moving to a proper warehouse provider or conducting a review of order fulfillment operations in your warehouse. Creating a well-thought inventory strategy helps businesses optimize costs and ensure sales efficiency.

Inventory management software

In today's environment, sophisticated software is a vital tool for business management. It provides real-time visibility into processes and transactions, as well as historical data records. The most significant aspect of a robust inventory management system is that it allows you to prevent out-of-stock situations rather than respond to them when they arise. If you can spot an inaccuracy while it hasn’t yet ballooned into an expensive issue, it is an excellent opportunity for cost savings and increasing inventory accuracy. The majority of modern transportation management systems, such as PLS PRO, also offer consistent inventory management.

Working with a 3PL (3rd party logistics company)

Working with a reliable and recognized 3PL can simplify your operational responsibilities and improve the effectiveness of your supply chain. Aside from that, consider the following comprehensive benefits of outsourcing your logistics to a third party:

  • Reduce costs. All of the services that a 3PL can provide will not only be worthwhile but will also dramatically lower your transportation costs. It also enables you to reduce manual management and concentrate on your primary competency.
  • Visibility and reporting. The majority of 3PL providers employ transportation management systems (TMS) to manage each shipment efficiently. Technology provides you with a 360-degree view of every activity and ensures that you stay on top of every update.
  • Supply chain agility. As a business, you retain control of your transportation while a 3PL manages it. A good 3PL can respond to your transportation demands as they vary with time or demand.

To summarize, collaborating with a reputable third-party logistics supplier can assist e-commerce businesses in various ways. Check PLS’s logistics solutions for retailers!

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