This article highlights five key techniques for effective inventory stock control of an organisation. Maintaining safety stock is an essential part of capturing opportunistic sales, retaining business and making customers satisfied. The common reason of delay shipment is lack of proper planning for inventory stock control. The safety stock lever is essential especially for those products with long delivery lead time.
Inventory control is also important to maintaining the right balance of stock in your warehouses. You do not want to lose a sale because you did not have enough inventory to fill an order. On the other hand, over-inventory can trigger profit losses – whether a product expires, gets damaged or replace by new version.
Forecasting is the technique of using the historical data to predict the future. As simple as it may sound, businesses find this difficult to do. This is in great part because there are way too many forecasting techniques out there and business leaders get confused about which to use. We will look into some of these techniques used across the world and how to choose them for a specific business problem. In production and inventory control, increased accuracy is likely to lead to lower safety stocks. The Purchasing manager and forecaster must weigh the cost of a more sophisticated and more expensive technique against potential savings in inventory costs.