{"id":16763,"date":"2024-01-13T06:08:10","date_gmt":"2024-01-13T06:08:10","guid":{"rendered":"https:\/\/breadstack.com\/?p=16763"},"modified":"2024-02-17T00:41:44","modified_gmt":"2024-02-17T00:41:44","slug":"how-to-improve-inventory-turnover","status":"publish","type":"post","link":"https:\/\/breadstack.com\/insights\/e-commerce\/how-to-improve-inventory-turnover\/","title":{"rendered":"How To Improve Inventory Turnover: Turning Overstocked into Opportunity"},"content":{"rendered":"\t\t
If you\u2019re like many online retailers, you stocked up for the holiday season. But while it\u2019s crucial to be prepared for a surge in demand, there\u2019s always a risk of ending up with too much stock of the wrong products. Learning how to improve inventory turnover<\/strong> will help tremendously for managing inventory and sales planning.<\/span><\/p> Microtrends, changing social and economic conditions, and mistakes in forecasting can all contribute to stocking errors. In February of 2022, the challenge of post-holiday <\/span>inventory turnover came front and center: over half of American retailers were sitting on excess inventory following the January returns wave.\u00a0<\/span><\/p> All that warehouse space, lost revenue, and (in some cases) deteriorating stock quality are real expenses. Small-scale retailers reported an average of $48,000 tied up in excess stock, with the majority admitting they would probably have to liquidate those extra quantities.<\/span><\/p> In this article, we\u2019ll take you through some of the pitfalls of overstocking, along with the limitations of common strategies to reduce overstock.\u00a0<\/span><\/p> Then, we\u2019ll discuss how real-time inventory and <\/span>customer data<\/b><\/a> can work in tandem to help you increase your inventory turnover in a way that is healthy, sustainable, and good for business.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t Overstock hurts retailers in more ways than one. For most, a chief concern is the financial burden. Excess inventory ties up valuable capital that you\u2019d prefer to invest elsewhere, such as in new products, marketing campaigns, or business expansion.<\/span><\/p> Storing surplus goods incurs additional costs, not the least of which is warehousing fees. Certain products, such as food or plants, may be at risk of spoilage, while others face obsolescence. For example, if your warehouses are full of winter sports equipment, you\u2019re likely feeling the pressure to sell all of that off before the season ends.<\/span><\/p> Finally, overstock can damage your brand image. If customers sense that you\u2019re struggling to get rid of products, they may start to doubt how well your business is doing.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t Handling overstock is a delicate balancing act, and many retailers fall prey to common mistakes that worsen the situation. If you haven\u2019t already taken a good look at your <\/span>inventory management<\/span><\/i><\/a> practices, now is the time to tighten up your stock review, communications, and performance tracking habits.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t Failing to conduct regular inventory checkups is a common pitfall. Without accurate and up-to-date information on stock levels, you may find yourself blindsided by overstock situations, making it challenging to implement timely solutions.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\tThe excess inventory challenge<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
Common challenges to a healthy inventory turnover <\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
Irregular inventory checkups<\/h3>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t