Inventory Management

Though the key idea of every business is to make significant profits, there comes a time when things don’t work exactly how they should do. However, this does not mean a supply chain manager has failed to achieve his/her objective. There are factors that can lead to slow moving and obsolete goods, and the main reason being technological changes. Customers or product users are continually changing, so too is the technology. This happens gradually sometimes, and the stock may become irrelevant to users over time. So, don’t get upset because there is always a way to solve such crisis!

Inventory management

Alright, obsolete goods are bad for your inventory. For instance, nowadays people are more interested in buying smartphones than the ‘old’ mobiles phones. Remember the days when people used to have those Siemens and Motorola mobile devices with simplified keypads and black & white screen displays. There were as many customers that demanded those gadgets and companies really made sales. Today, such devices are out of date, and very few individuals are willing to buy them. However, there are
some companies still hosting obsolete goods on their shelves due to extremely low demand.

So, what can you do to that obsolete goods sitting at the shelves of your premise? As a supply chain manager, you need to identify such goods first. This can be done through understanding the current position of your inventory, the turns of the inventory, and then check the cycle count method that will help you identify everything pertaining to such goods. Once you have identified the slow moving inventory, create a way of moving it by directing the sales team to market them. It is the responsibility of the marketing department to get it moving by telling the salesmen to sell the goods.

Lastly, you need to employ new tactics that will drive success, as well as getting rid of the slow moving and obsolete goods. So, there is need to utilize demand planning strategy to target those users that still need the products. Of course, there are a number of users still resisting to technological changes, and they prefer using products that they have been used to. Another strategy is lead time management, where the sales force ‘must’ deliver the products to the users once the orders are made. The other very important strategy is making use of cycle counting in order to avert slow moving inventory from recurring. You need to conduct accurate inventory, and it is vital to combine 100% physical inventory and cycle counting inventory.