Power of inventory management for MSMES

By Ras

Inventory management is the process of ordering, storing, and tracking the inventory of a business. It is an essential part of any business, but it can be especially challenging for Micro and Small and Medium Enterprises (MSMEs).

There are a number of challenges that MSMEs face when it comes to inventory management. These include:

• Limited resources: MSMEs often have limited resources, which can make it difficult to invest in inventory management software or hire dedicated inventory management staff.

• Lack of expertise: MSMEs owners and managers may not have the expertise or experience to effectively manage inventory.

• Changing demand: Demand for products can fluctuate rapidly, making it difficult to predict how much inventory to order, this coupled with market demand affected by seasonal influences like the holidays (demand is high) and traditionally low market seasons like January

• Dead stock: MSMEs may have difficulty selling obsolete inventory, which can lead to losses which are hard to capture on the income versus expenses she

Despite these challenges, there are a number of things that MSMEs can do to improve their inventory management. These include:

• Use an inventory management software: Inventory management software can help MSMEs track inventory levels, order products, and provide necessary data to forecast demand.

• Set inventory levels: MSMEs should set inventory levels that are based on their sales history and expected demand.

• Rotate inventory: MSMEs should rotate inventory so that the oldest items are sold first. Sometimes this can be challenging depending on seasonality of products in your inventory.

• Conduct regular inventory audits: MSMEs should conduct regular inventory audits to ensure that their records are accurate.

• Take steps to prevent theft: MSMEs should take steps to prevent theft, such as installing security cameras and using inventory tags.

By addressing these challenges and taking steps to improve their inventory management, MSMEs can improve their profitability and efficiency.

Here are 5 some useful tips for MSMEs to improve how they manage their inventory :

• Use a barcode scanner: A barcode scanner can help you quickly and accurately track inventory levels, you can purchase affordable barcode scanner from any dealers/ Jumia has a few

• Set up an organized, designated inventory storage area: This will help you keep track of your inventory and prevent loss, damage or theft.

• Regularly review your inventory turnover rate: This will help you identify poorly performing products and deadstock and take steps to reduce the effect on your business profit.

• Work with your suppliers to get better pricing and delivery terms: This can help you save money on your inventory costs.

• Outsource your inventory management: If you don't have the time or resources to manage your inventory yourself, you can partner with third-party companies that help MSMEs manage inventory.

By following these tips, MSMEs can overcome the challenges of inventory management and improve their bottom line. Follow our social media platforms for more tips