Supply Chain Connect
Quick Chat: 5 Inventory Management Tips for Electronics Buyers

Quick Chat: 5 Inventory Management Tips for Electronics Buyers

April 8, 2024
Tips for electronics buyers to successfully balance their inventory.

Managing inventory has always presented complex challenges for organizations. Unavoidable factors like changing customer behaviors, seasonal variances, long lead times, delays and budgetary constraints can all impact even the best-laid inventory management approaches.

Manual processes can also complicate the inventory management strategies, which can benefit greatly from technology aimed at streamlining the process.

TechTarget states that “Inventory management platforms can reduce inefficiencies and improve inventory handling, replenishment and fulfillment.”

It says inaccurate data and analysis, delays in reordering, ineffective production planning, and inventory defects and waste can all contribute to a company’s inventory management headaches.

The most effective inventory management strategies help procurement departments, supply chain professionals and other stakeholders streamline processes, operate more efficiently and drive down inventory carrying costs.

Here are five tactics you can start using today:

1. Adopt a good inventory management system

A sound inventory management system is the beating heart of any enterprise, offering real-time access to data that enables business leaders to forecast trends and shifts in buyer needs, as well as gain full transparency into demand and inventory levels.

Kristy Short writes in “8 tactics for inventory management,” that “inventory management systems output powerful analytics and provide much-needed visibility into operations. For example, monitoring run rate to gain visibility into how much of an item you are selling at a given time helps accurately predict future demand.”

2. Take control of your own inventory

Don’t rely on suppliers and providers to accurately report on inventory levels. Take the lead role by regularly monitoring, auditing and managing inventory in your system to maintain an accurate picture of goods. Keep an eye on what’s coming into your supply chain, regularly check the quality as well as the quantity you receive, and conduct inventory checks periodically throughout the month or quarter.

3. Leverage vendor-managed inventory strategies

In “The Importance of Inventory Management in Electronics Supply Chain,” Ninaad Acharya describes how companies can use vendor-managed inventory – or VMI – to reduce stockouts, minimize excess inventory and reduce the burden on in-house inventory management. This inventory tactic can also help solidify supplier relationships which, in turn, may lead to better pricing and terms. For best results, businesses must work closely with their suppliers to establish clear guidelines and expectations for inventory levels and replenishment. Organizations should also use software tools to track inventory levels and usage, both of which can help anticipate future demand and support better decision-making. 

4. Conduct an ABC analysis

This inventory management technique ranks inventory items based on their importance to a business. Evan Tarver writes in Forbes, that “this is most helpful when a business needs to prioritize which items to order and store, allowing for more oversight on certain inventory items.”

When conducting an ABC analysis, he recommends dividing the inventory into three categories:

  • A Items: The most important items that account for 20% of the inventory items but up to 80% of the inventory value.
  • B Items: Items with medium importance to the business that account for 30% of the inventory items and roughly 15% of the inventory value.
  • C Items: The least important items that account for 50% of the inventory items but only around 5% of the inventory value.

5. Experiment with advanced technologies

The Internet of Things and smart warehousing technologies can help businesses optimize inventory management by providing real-time visibility into inventory levels, locations and movement. Acharya writes, that “with IoT sensors and smart tags, businesses can track inventory in real-time, streamline supply chain operations, and automate tasks such as inventory counting and tracking.”

Use these five tips and you can successfully navigate the balancing act that is inventory management.

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About the Author

Tyler Fussner | Managing Editor - Community Manager | Supply Chain Connect

Tyler Fussner is Managing Editor - Community Manager at Supply Chain Connect, part of the Design & Engineering Group at Endeavor Business Media.

Previously, Fussner served as the Associate Editor for Fleet Maintenance magazine. As part of Endeavor's Commercial Vehicle Group, his work has been published in FleetOwner magazine, as well as Bulk TransporterRefrigerated Transporter, and Trailer-Body Builders.

Fussner's May 2022 print feature 'The dawn of hydrogen trucks' was named the best single technology article in B2B by the judges of the 2022 Folio: Eddie and Ozzie Awards. Fussner was also awarded Silver in the Technical Article category for the Trade Association Business Publications International (TABPI) 2021 Tabbie Awards.

Fussner previously served as Assistant Editor for Endeavor's Transportation Group on the PTEN, Professional Distributor, and brands.

Fussner studied professional writing and publishing at the University of Wisconsin-Whitewater. He has experience in shop operations, is a Michelin Certified Tire Technician, and a Michelin Certified Tire Salesperson.