What happens when you’re looking for a product or service either online or offline and you can’t seem to find it? Of course, you’ll feel frustrated. This is what a customer goes through when they can’t find their stored inventory.
Inventory management is all about knowing what you have, where it's stored, and how much of it you've got. But it's more than just a count; it's strategically controlling your business's inventory so you can meet your customers' demands. The goal is simply to have the right products, in the right quantity, at the right time, and at the right cost.
Inventory management is a crucial link in your self-storage supply chain. Just imagine a tenant pulling up in a moving truck to store their belongings. If you don't have the necessary supplies on hand, like moving boxes or packing tape, that can quickly turn into frustration.
Keeping track of your stock helps you get a clearer picture of your finances. You'll know exactly how much you've invested in supplies and equipment, which helps you make informed decisions about future purchases and pricing.
All in all, managing inventory helps you:
Save money: By avoiding overstocking and minimising waste.
Improve customer service: By ensuring you have the supplies tenants need when they need them.
Make better business decisions: By having a clear understanding of your financial situation.
Here's how a strong inventory management system can unlock even bigger benefits for your business:
It starts with having the right supplies on hand, exactly when they need them. By keeping just the right amount of stock on hand, you ensure that your customers get what they need when they need it. In the self-storage world, this could mean providing the perfect size unit right when a customer is moving house or expanding their business.
You can scale your business smoothly with a solid inventory management system. You'll have the insights to make informed decisions. It might involve deciding when to expand your storage or invest in new locations. By understanding what’s in demand, you can steer your business in the right direction.
Effective management directly impacts your profitability. You can boost profit margins by minimising overstocking (and thus, storage costs) and reducing the risk of no inventory (which can lead to lost sales). It's all about balancing cost against demand and making sure that the unused goods aren't a financial burden for you.
Inventory management helps cut costs in several ways from reducing the need for excessive storage space to minimising the losses from unsold stock. This efficiency results in more available resources for other business areas, such as marketing or property improvements.
For those in the self-storage business, if you can optimize your available space, reduce overheads, and improve your cash flow, it will automatically translate to effective management. Your company will have more liquidity when less money is locked up in stagnant stock. It allows you to react to changes in the market and new opportunities.
A robust management system can help you predict sales trends and allow real-time adjustment to your strategy. This foresight can be particularly important as seasonal trends and economic fluctuations can affect demand. Knowledge of these trends can help you prepare your inventory to meet customers' needs.
Excess Inventory: If you ever find yourself surrounded by too many things, you’ll understand this challenge. Holding onto excessive stock takes up valuable cash and precious storage space that could be spent on earning rent.
Running Low: Shortage of inventory can lead to frustrated customers and lost sales. Lacking inventory for orders can also damage your reputation and your profit margins.
Outdated Systems: Relying on outdated spreadsheets or sticky notes for inventory can mean disaster. Outdated tech systems are prone to errors and make it difficult to get a clear picture of your stock levels.
Adapting to Customer Demands: Customer needs can change like the weather. What if there’s a sudden demand for students needing storage before the term starts? A good management system helps you predict these shifts and adjust your stock accordingly.
Warehouse Issues: Poor organization can make finding what you need time-consuming. Misplaced or hard-to-find items can lead to delays, customer frustration, and inefficiencies. There are strategies available to streamline this process.
Your inventory can be categorised into different groups:
In the world of management, raw goods consist of basic materials you can use. The unopened boxes of packing peanuts, the fresh rolls of tape, and the shrink wrap all come under this category. These are the essential supplies you'll need to keep your self-storage operation running smoothly.
In manufacturing, WIP includes all the materials that have been partially transformed but aren't complete products yet. Maybe you've partially assembled some shelving units or waiting to label a box of key fobs. These are your work-in-progress items.
Finished goods consist of neatly stacked boxes, organized rolls of packing tape, and hooked key fobs. These are the end product of your efforts. Finished goods equate to spaces that are fully prepared, rented out, and generating income.
MRO goods are essential for self storage maintenance, repairs, and daily operations. It can be cleaning supplies for your units or the security systems that protect them. MRO goods are crucial for maintaining the quality and reliability of your service.
Leverage Wigwam’s expertise to develop a state-of-the-art, remotely managed storage facility on your land. We handle everything from design and construction to ongoing operations.
An inventory management system is a toolbox where each tool serves its purpose. Here are some of the most common ones:
Just-in-Time (JIT): This method is all about keeping a lean stock, ordering supplies only when you need them. It's great for saving on storage space and reducing waste but it requires good forecasting and reliable suppliers.
Just-in-Case: This is the opposite of JIT, where you keep a bit of extra stock on hand just in case of unexpected demand spikes. It provides peace of mind but can tie up cash and storage space.
ABC Analysis: This trick helps you categorise your inventory based on value and importance. You can closely manage your high-value "A" items while allowing for a little more flexibility with your lower-value "C" items.
First in, First out (FIFO): Think of it as a queue line at the shop. This method ensures the oldest boxes of packing peanuts (or your chosen baked good) get sold first, keeping your stock fresh and avoiding outdated items lingering on the shelves.
Last-In, First-Out (LIFO): Through this, the newer stock gets sold first, which can help manage fluctuating prices or perishable goods.
Dropshipping: It lets a supplier handle the storage and shipping of certain items while you focus on renting units.
Vendor-Managed Inventory (VMI): This involves partnering with a supplier to have them monitor your stock levels and automatically send you refills when needed.
Cross-Docking: Goods arriving at your warehouse are immediately sorted and redirected to their next destination without ever sitting in storage. It's a way to speed up delivery times and reduce handling costs.
Cycle Counting: This technique allows you to regularly check specific inventory items instead of counting everything at once and helps ensure accuracy and avoid stockouts.
Economic Order Quantity (EOQ): EOQ tells you the ideal order size to minimise costs related to ordering, delivering, and storing goods. It's about finding the right amount where costs are lowest and efficiency is highest.
Minimum Order Quantity (MOQ): MOQ represents the smallest amount you can order from a supplier. Understanding and negotiating MOQs can help you maintain flexibility and reduce inventory costs.
Safety Stock Inventory: This is your emergency fund of inventory, kept on hand to prevent a shortage.
Reorder Point: It is a formula that tells you precisely when to reorder stock, based on your sales velocity and lead times. It's about perfect timing to ensure you're never caught short but also not overstocked.
Batch Tracking: Keeping tabs on batches of products can help with quality control, recalls, and understanding sales patterns.
Consignment Inventory: With consignment, you only pay for what you sell. This can significantly reduce risk and upfront costs.
Lean Manufacturing: Lean is all about efficiency, cutting waste, and optimizing productivity. It's a philosophy that can be applied beyond manufacturing, even into how you manage your self-storage spaces.
Six Sigma: Six Sigma focuses on reducing errors and improving quality. For self-storage owners, applying Six Sigma principles could mean streamlining operations and enhancing customer satisfaction.
Demand Forecasting: Using data to predict future demand helps you stay one step ahead. It ensures you're prepared for whatever comes your way.
Partner with Wigwam to create a successful joint venture. We structure partnerships that benefit everyone involved, maximising value for investors and landowners.
Also Read: Converting Existing Buildings into Self-Storage Facilities: Tips, Tricks, & Benefits
Think of your management method as the filing system for your stockroom. Here are the main approaches you can choose from:
This is like a yearly spring clean. You physically count all your stock at set intervals, typically once every accounting period (month, quarter, or year). It's a straightforward method but can be time-consuming and might not give you a real-time picture of your stock levels.
It is like a live inventory counter that updates every time you sell a box of packing peanuts. This method uses software to track stock levels constantly, giving you a more up-to-date picture of what you have on hand. It requires an initial investment in software but can save you time and money in the long run.
It helps you forecast future inventory needs based on your sales forecasts, production schedules, and current inventory levels. MRP systems can be a game-changer, especially if you're managing a larger operation with multiple self-storage facilities. They help you plan for the future, ensuring you have just the right amount of inventory on hand when you need it, without over or under-stocking.
Imagine trying to manage inventory operations with pen and paper. Not very efficient. Management systems automate tasks, provide real-time data, and generally make your life a whole lot easier.
The transition from manual to automated is a leap towards efficiency, accuracy, and scalability.
Manual Systems: Manual management is hands-on, often involving physical counts and ledger entries. It can be laborious, time-consuming, and prone to human error, yet for some small operations, it provides a simple approach to managing inventory.
Automated Systems: Automated management systems are the digital answer. These offer real-time tracking, analytics, and seamless operation. These systems are a boon for busy self-storage operators, allowing for efficient management of unit availability, maintenance schedules, and customer billing with just a few clicks.
At Wigwam, we prioritise safety with cutting-edge technology (cloud-based locks operated by Bluetooth) that tracks movement, prevents unauthorized access, and allows for keyless entry. Plus, our flexible and convenient remote facility operations ensure a seamless experience for your tenants.
Real-Time Inventory Tracking: Stay updated with live data on unit occupancy, maintenance needs, and more.
Analytics and Reporting: Gain insights into customer behaviour, peak demand periods, and revenue trends.
Automated Alerts: Receive notifications for low stock levels, upcoming maintenance, or expiring leases.
Integrated Accounting: Link your inventory system with accounting software for seamless financial management.
Mobile Accessibility: Manage inventory operations on the go, bringing flexibility to how and where you work.
Selecting the perfect management service for your self-storage business can feel like finding a needle in a haystack. Here's what to look for:
Ease of Use: The system should be intuitive, making it easy for you and your team to hit the ground running.
Scalability: As your business grows, your system should grow with you, accommodating more units without skipping a beat.
Customizability: Every self-storage business is unique. Look for a system that can adapt to your specific needs.
Support: A responsive support team is crucial. Ensure the service provider offers comprehensive training and assistance.
Cost-effectiveness: Weigh the features against the price to ensure you're getting value for your investment.
Management software and tools help you streamline processes, track inventory with ease, and ultimately, free you up to focus on what matters most – growing your self-storage business.
Automating repetitive tasks: The software can automate tasks like order processing and stock level updates.
Real-time tracking: Management software provides real-time data on what you have on hand, where it's located, and when it needs to be reordered.
Improved accuracy: The software minimises the risk of mistakes in your inventory data, keeping things accurate and reliable.
Integration with other systems: Integration with your existing accounting software or property management tools is key to creating a seamless workflow.
Reporting and analytics: Management software goes beyond simple tracking. It can generate reports that provide valuable insights into your sales trends, allowing you to make data-driven decisions about your inventory.
Reduced costs: Minimising waste, avoiding stockouts, and optimizing your purchasing decisions all lead to one thing: more money in your pocket.
Improved customer service: Keeping your tenants happy is paramount. Management software ensures you always have the supplies your tenants need when they need them.
Better decision-making: With access to real-time data and valuable reports, you can make informed decisions about your inventory and your overall business strategy.
Barcode scanners: Scan boxes of packing peanuts and rolls of tape with ease, ensuring accuracy and saving you time.
Mobile inventory apps: Manage your stockroom on the go with a user-friendly mobile app.
Low-stock alerts: Get notified automatically when it's time to reorder supplies, preventing stockouts and disruptions.
Inventory forecasting tools: Predict future demand based on historical data and industry trends, ensuring you're always prepared.
Focus on Your Needs: Focus on tools and techniques that directly address your specific business needs and the size of your operation.
Engage with Suppliers: Building strong relationships with your suppliers is key. Negotiate good deals, discuss lead times, and explore options to manage your stock levels.
Optimise Your Inventory Control Process: Streamline your inventory control process, determine clear ordering procedures, and set reorder points to avoid stockouts. Also, conduct regular stock takes to ensure accuracy.
Use Real-Time Data: Modern management software provides real-time data on your stock levels and sales trends to make informed decisions about ordering, pricing, and promotions.
Take Your Inventory Mobile: Use mobile inventory apps to scan items, check stock levels, and manage your inventory on the go.
Understand Your Inventory: Analyze your stock and categorise items based on importance and value. This will help you prioritise your management efforts.
Know Your Priorities: Set clear goals for your management. Do you want to minimise waste? Improve customer service? Once you know your priorities, you can tailor your approach.
Consider Manual Stock Counting: Don't underestimate the value of regular physical stock counts. This can help catch discrepancies and ensure your data remains accurate.
Build the Best Practices: Management is an ongoing journey. Experiment to find what works best for you and continually refine your approach based on experience and data.
Connect with Your Suppliers: Maintain open communication with your suppliers. Discuss challenges, explore new products, and keep them informed of changing demand.
Imagine a system that can predict demand for packing peanuts with uncanny accuracy, or even identify potential stockouts before they happen. That's the power of AI. By analyzing historical data and sales trends, AI can help you optimize inventory levels and ensure you always have the supplies your tenants need.
In the future, your stockroom might be filled with "smart" items – boxes with built-in sensors that track their location and status in real time. It can help you locate any box of tape in seconds, or receive an alert when a particular item needs restocking.
Blockchain technology is a secure, shared ledger system that can connect all the parties involved in your supply chain. Everyone from suppliers to distributors to even you can create a unified record of transactions. This way blockchain can improve transparency, security, and efficiency in your inventory management.
Intelligent order management systems use advanced algorithms and historical data to generate highly accurate forecasts of future demand. This means you can say goodbye to overstocking and hello to a perfectly optimized inventory.
Quantum computing holds the potential to revolutionize complex supply chain problems. This futuristic technology could help us solve intricate logistical challenges and optimize management on a whole new level.
By now, you understand the importance of keeping the right supplies on hand, the benefits of using a robust system, and the exciting possibilities of emerging technologies.
At Wigwam Storage Management, we understand the unique challenges and opportunities faced by self-storage owners and investors. We offer a comprehensive suite of services designed to help you optimize your inventory management and maximize your profits.
Whether you're looking to streamline your operations, improve customer service, or boost your bottom line, Wigwam Storage Management can help. Contact Wigwam Storage Management today for a free consultation.
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