{"id":292,"date":"2020-09-18T05:48:40","date_gmt":"2020-09-18T05:48:40","guid":{"rendered":"https:\/\/www.cac.net.in\/blog\/?p=292"},"modified":"2024-10-11T16:43:04","modified_gmt":"2024-10-11T11:13:04","slug":"reasons-for-keeping-sufficient-stock","status":"publish","type":"post","link":"https:\/\/www.cac.net.in\/blog\/reasons-for-keeping-sufficient-stock\/","title":{"rendered":"Reasons For Keeping Sufficient Stock"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">One of the main reasons for inventory\navailability is to provide customers with the best possible level of service.\nHowever, many managers spend their time worrying about finding the balance\nbetween product availability and supply Chain costs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Why\nshould you keep stock?<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Your inventory availability is important to\nmeet customer demand. However, the actual level of inventory you should have is\naffected by the following factor:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Fluctuation in supply<\/li><li>Supplier restrictions on issues\nsuch as minimum order quantities<\/li><li>Current inventory strategy<\/li><li>Contractual service level\nagreement with customers<\/li><li>Purchasing economies of scale\nand cost optimization<\/li><li>Minimizing delivery costs<\/li><li>The level of service the\ncustomer expects<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Do\nyou keep enough stock?<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">While keeping excess stock can decrease\nyour profitability, lower it can negatively affect your service level. As a\nresult, a company that cannot meet the demand on time cannot compete today.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That&#8217;s why, we&#8217;ve summarized the 5 most common factors that a company has availability issues:<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/i.pinimg.com\/originals\/f9\/00\/59\/f900591b975db444034899bc4f8341bb.jpg\" alt=\"Inventory Management System. #CAC #Retailaudit #Businessadvisory  #Transactionadvisory #Retailinventory #Duedili\u2026 in 2020 | Inventory  management, Management, Internal audit\"\/><figcaption><a href=\"https:\/\/www.cac.net.in\/inventory-management\">https:\/\/www.cac.net.in\/inventory-management<\/a><\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>1.\nThe shelves that should be full are too empty<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The first and most obvious indication that\na company has a availability problem is empty shelves. Buying large quantities\njust to make the empty shelves look full is not a reason to keep inventory. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">According to <strong><a href=\"https:\/\/www.cac.net.in\/inventory-management\">inventory management firms<\/a><\/strong>, this may indicate that something is wrong. Especially if the empty shelves are only in a certain part of the warehouse, this may mean that there is more stock in other locations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>2.\nExcessive pre-order<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For many companies, pending order is a\nhedge against the risk of out of stock. Although customers want the stock to be\nready in a corner for an unusual situation, if the pending order becomes a\nhabit, this can seriously reduce customer satisfaction. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If the same products result in a pending\norder every month, it must be questioned why there is never enough inventory in\nthe first place!<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>3.\nExcessive commitment to air freight and express delivery<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Sometimes it is necessary to invest in air\nfreight to ensure that sufficient inventory levels are available in a short\ntime to meet demand. However, the additional cost involved in shipping by air\nor using express courier services can significantly lower your profitability. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As a result, it is not a long-term solution\nto ensure availability. As with pending orders, products that need to be\npurchased regularly should be investigated in urgent orders.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>4.\nCustomers<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If a company realizes that it has an\navailability problem the first time customers report it, there is a real\nproblem. By the time this point is reached, it is usually too late to do\nanything about it. However, every customer complaint should be reviewed to\ndetermine the true source of the problem.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>5.\nLow sales figures<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Customer complaints give the company an\nopportunity to correct the existing problem in the future. But often,\navailability issues push the customer to make other decisions. In the short\nterm, this will result in missed sales opportunities. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">More importantly, the risk of the customer never coming back increases significantly. Hence, availability issues have a profound impact on sales figures. If you are having problems determining the optimal stock level and need support, you can contact inventory management companies for inventory management solutions. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>One of the main reasons for inventory availability is to provide customers with the best possible level of service. However, many managers spend their time worrying about finding the balance between product availability and supply Chain costs. Why should you keep stock? Your inventory availability is important to meet customer demand. However, the actual level&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[94,69],"class_list":["post-292","post","type-post","status-publish","format-standard","hentry","category-inventory-management","tag-best-inventory-management-firms","tag-inventory-management-firms"],"_links":{"self":[{"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/posts\/292","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/comments?post=292"}],"version-history":[{"count":1,"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/posts\/292\/revisions"}],"predecessor-version":[{"id":293,"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/posts\/292\/revisions\/293"}],"wp:attachment":[{"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/media?parent=292"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/categories?post=292"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.cac.net.in\/blog\/wp-json\/wp\/v2\/tags?post=292"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}