This article will address two key questions:
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Common strategies and practices for optimizing inventory, and
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How the Magento 2 Inventory or Stock Management Extension & Planner from Mirasvit enables efficient stock management in your store.
To explore the product further, visit the link for inventory management in Magento.
When discussing inventory, we are primarily referring to warehouse inventory.
The purpose of commodity stocks includes:
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Close the needs of buyers:
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Timely processing of the order.
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Current prices.
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Pleasant experience. After all, there will not be such a situation in which the user orders something on the website, but the product is not in stock.
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Eliminate shortage of goods.
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Good customer experience.
And the need for competent and thoughtful inventory management is crucial.
Inventory management
Inventory management is a process that includes three factors: ordering, storing, and using store inventory.
Effective inventory management is critical to the success of your store. After all, product management involves maintaining the optimal level of stocks to consistently meet your customers' demands on time, minimize costs, and maximize profits.
Let's consider the problems that may arise in the event of a shortage and surplus of goods.
Lack of goods. Potential problems.
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Poor user experience.
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Loss of customers who may switch to competitors who do not have a shortage of goods.
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Loss of earnings.
Excess goods and the problems that arise from it
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Working capital, which seems to be "frozen" in surplus goods, is blocked. Because of this, the entrepreneur may not have enough funds for new purchases, and the need for loans will appear.
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There is an imbalance in the assortment. The balance interferes with the rational forecast of purchases and the formation of the assortment. After all, to sell off the balance, it will be necessary to order less running goods and novelties in which the buyer is interested.
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The percentage of lost sales due to many unliquidated goods or due to the write-off of overdue goods is increasing.
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Profit decreases as unsold products necessitate the implementation of promotions and sales.
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Business development experiences a slowdown due to the accumulation of excess goods.
Now, let's delve into the primary strategies for effective inventory management.
Basic strategies and techniques of inventory management
Use the following methods to customize your inventory management as efficiently as possible:
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Utilize attributes to categorize and organize products, simplifying goods tracking.
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Implement low inventory alerts to prevent out-of-stock situations.
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Support multiple warehouses to optimize your order fulfillment
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Use tools to automate product inventory
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Use barcodes for fast and accurate inventory counting.
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Create advanced reports to build forecasts and strategies for developing your business based on them.
Inventory management strategies
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Establishing a nominal level for each product is crucial. This represents the minimum quantity that must always be in stock. When your inventory falls below this level, it signals that replenishment is necessary. The nominal level varies for each product, depending on its sales velocity.
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Employ the First-in-first-out (FIFO) strategy, where the initial stock received is the first to be sold. This is particularly applicable to perishable or expired products.
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Foster effective relationships with suppliers. A strong rapport with suppliers is vital for resolving urgent matters, such as promptly replenishing stocks or addressing production issues. Supplier cooperation is beneficial in such scenarios.
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Regular audit. Take stock regularly and check product quantities and whether your items are in salable condition.
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ABC method. You have high-priority, low-priority, and medium-priority items. This method helps to prioritize inventory management. This way, you will separate the products needing more attention from those not.
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Accurate forecasting. So, you will be able to predict different scenarios of the development of events. The following factors should be included in the forecasts: current market trends, last year's sales for the current period, growth rates in the current year, seasonality of products, and general economy.
Magento 2 Inventory or Stock Management Extension & Planner by Mirasvit
The Mirasvit extension is a precise tool that automates and enhances inventory management efficiency. The Inventory Planner extension accurately forecasts the timing and quantity of items to replenish while identifying excess inventory.
This automation occurs seamlessly upon installing the extension. Real-time forecasts are promptly generated after the module installation and input of default values. Forecasts continue to update with each modification made.
Explanation of the operation of Magento 2 Inventory or Stock Management Extension & Planner: The module calculates your product replenishment date and quantity, with values dependent on sales velocity, inventory quantity, expected sell-out date, anticipated reserve, and average replenishment time.
The surplus of goods is estimated through an analysis of their sales speed and the quantity available in stock.
Access the following data using the extension:
