November 14th 2023 11:00:00 AM
Is it Time to Switch to Just-in-Case Inventory Management?
January 3rd 2023 11:00:00 AM
It’s impossible to follow the news recently without seeing mention of a possible recession. Certainly, economic turmoil and supply chain disruptions are not unusual in the modern world. As we embark on a New Year, it’s an excellent time to take a look at your inventory management. If you have been using a just-in-time strategy with a lean approach to stocking inventory and avoiding overstocking in your warehouse, it may be time to pivot to a just-in-case approach.
Before the COVID-19 pandemic started, the conventional wisdom about supply chain management strategy was to keep just enough inventory available to meet expected demand. Holding on to extra stock would hold up too much of the company’s cash in inventory. With the global pandemic and multiple product shortages and delays that have become commonplace, businesses need to reconsider whether that is their best practice.
Benefits of Just-in-Case Inventory Management Strategy
With a just-in-case strategy, you will be stocking more than the minimum level of products in the warehouse. This strategy provides your business with multiple benefits.
1. It helps your business stay competitive.
When a customer wants to buy a product but can’t complete their purchase because it is out of stock, they will simply click away from your website to look for the item elsewhere. If it turns out the other company has competitive pricing, fast delivery, and good customer service, you may well lose that business permanently.
Just-in-case inventory allows you to keep your loyal customers supplied with products. Your customers will continue coming to you since you have the items they want in stock.
2. Ordering stock becomes a much easier process.
There is more wiggle room available when you choose a just-in-case inventory management system over a just-in-time one. This strategy assumes supply will be greater than demand for products and your company will always have extra stock of items at any given time.
3. The company can take advantage of bulk discounts from suppliers.
Consumers like to stock up on “buy one, get one” offers from retailers when they get the opportunity for a reason: The discount allows them to buy in bulk and save money. Your business can do the same when your suppliers offer discounts for buying larger quantities of inventory.
Taking advantage of better pricing allows you to make your capital go further and saves time on your production processes. It also helps lower the amount you are charged for shipping.
4. Stocking up helps your company avoid supply chain bottlenecks.
Suppliers are working hard to get raw materials and products moving and into manufacturers’ and distributors’ facilities quickly. Unfortunately, they are still experiencing some delays in keeping orders filled. Ensuring you have extra inventory on hand protects your business when snags in the supply chain inevitably happen.
5. It provides flexibility in marketing your company’s products.
If you don’t sell all the stock you have in inventory, consider how much you can reduce the price on certain items and still remain profitable. It may still be feasible to offer the product as part of a buy one, get one offer to stimulate interest from your customers.
6. Just-in-case inventory management helps keep your company competitive.
With enough inventory in stock, your company can keep up with shifting levels of customer demand. Your company may even pick up new business if your competition is out of stock on items when their customers try to place orders.
7. This inventory system is flexible and scalable.
You are not required to use the just-in-case inventory management system for all products you carry in inventory. This system can be used for only the products or raw materials that make the most sense for your business. Start with only a few items and add others as it makes sense for your business.
Scanco WMS Professional: Advanced Solution for Warehouse and Distribution Facilities
Scanco WMS Professional is a robust solution for enterprise businesses. It was developed for companies involved in complex transactions with large warehouse operations.
Scanco Professional gives your managers and teams the capability to manage pallets entering and leaving your facility, pallet transfers, and pallet on pallet activities. All changes and updates made in the software are recorded directly into Sage 100.
Scanco Dashboard is included with Scanco Professional. This impressive BI tool gives you real-time insights and helps your team fill orders more quickly and efficiently than before. Scan barcodes using one of the multiple hardware accessories available.
Customize your dashboard so you only see the data most important to your business. Keep in touch with your warehouse team by chat so they can reach out immediately about any work delays, whether you are on the premises or off-site.
Do you work with items that arrive by the carton, container, or pallet? The optional License Plating module makes grouping and managing inventory in various containers easy.
The optional On the Water module allows you to track pallets in containers while in transit. On the Water also gives you the capability to track several purchase orders in containers.
Would you like to learn more about Scanco WMS Professional? Scanco has solutions designed to fit our valued clients’ individual needs, whether they are operating small, mid-size, or large businesses. Contact us online or call (330) 645-9959 to make an appointment with a Scanco Solutions Expert today.