To track perishable inventory, companies can use manual, automated, or hybrid inventory management systems focused on accurately matching supply with demand. READ MORE: Inventory Management 101: How to Manage Small Business Inventory The long-term viewĪs they work to put out daily inventory management fires, small business owners should also keep the longer-term view in mind, knowing that more shifts are likely to occur before we’re out of the woods with the COVID-19 pandemic and looking to a brighter future. Evidence suggests these COVID-driven behaviors are likely here to stay. Managing perishables in the fickle eCommerce selling environment - where return rates are higher than brick-and-mortar sales and where customers don't get to see the goods firsthand until they arrive on their doorstep - requires a certain finesse that some companies are only now learning to manage. This only added to the mystery around changing consumer behaviors and pushed many small companies to shift their focus to online sales. These pivots directly affect a small business’s ability to forecast demand and stock up accordingly (without going over).ĮCommerce is booming. A trend that was already well underway pre-COVID, online selling ramped up significantly in 2020. Others are stocking up on groceries and household items with the aim of protecting themselves and their families. As a result, small companies are being forced to stock up on goods “just in case,” but whether those products will sell within a desired timeframe remains unknown.Ĭonsumer shopping behaviors are changing. According to the National Retail Federation (NRF), 71% of consumers are social distancing, and an even higher percentage are avoiding brick-and-mortar stores right now. A few of the raw materials and products in high demand and short supply are N95 face masks, resin, electrical fuses, and small steel goods. Supply chains are still disrupted. There may be toilet paper on store shelves now, but there are still some serious supply chain disruptions happening worldwide. This has increased inventory carrying costs for small businesses that may get stuck with items they can’t offload as quickly as they’d like. According to BLS, supply chain issues caused increased volatility in prices in the months following COVID-19’s emergence in the U.S., with meat, fish, dairy, and eggs especially affected by the shifting economy brought on by the pandemic. Prices are increasing. Forced to contend with higher transportation and storage costs - not to mention the financial impacts of COVID-19 on their workforces and workplaces - companies are raising the prices on their products. This reverberates up the supply chain, with everyone from the retailer to the wholesale distributor to the original manufacturer now stuck with more perishable stock than normal. Fewer Recalls : Keeping tabs on your perishable goods allows you to hear of recalls right away.Sellers aren’t stocking up. Wanting to preserve cash, companies are keeping their stock to a minimum.Customer Satisfaction: managing inventory means understanding the supply and demand of the market- if you stock items that are popular with your customer base, they will continue to purchase them from your store.Improved Cash Flow: Having a handle on your inventory means your cash flow will increase as you only order what you need.
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