Avoid These Inventory Management Pitfalls

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Inventory management sounds easy enough until one day you find yourself in a bind and are unsure how you got there. Common pitfalls have snared more than one company, but the good news is once you’ve identified the risks, you can prepare.  Here are some of the most common inventory management mistakes and how to avoid them.


Lack of Training

Lack of training is by far the most common mistake when trying to manage inventory. Often, new inventory management software is installed, but there is little training and no follow up to make sure it’s being used properly.

Believe it or not, there is a right and wrong way to train your staff and the consequences of failing to do so are very real.

Takeaway: Take the time to teach your employees how to use the new system and listen to their feedback. If your staff is unsure of what they’re doing, they will likely just revert back to the old way and you’ll be right back where you started.


Lack of Forecasting

Improper forecasting means you can’t accurately plan, and your attempts to manage inventory go out the window. Even if you do attempt to forecast, if you aren’t measuring the correct metrics you will see a failure in inventory management.

Takeaway: Accurate forecasting depends on more than just predicting demand. You also need to consider what products are included in the forecast as well as customer satisfaction and the average percentage of returns.


Lack of Automation

The best way to successfully manage your inventory is to automate as much of it as possible. Even the best employees are subject to making mistakes that would otherwise be avoided by using proper automation. An employee manually entering information into a spreadsheet is slow and the timing can be delayed by days or even weeks.

Takeaway: By enabling automation you can track items and monitor orders being packed for shipment all in real time.


Lack of Organization

There are many theories about how to correctly organize a warehouse. While there may be more than one way to approach it, the most obvious answer is usually the most efficient one.

Takeaway: If your staff is spending a lot of time wandering around looking for an item, it may be time to rearrange. An organized warehouse makes keeping track of inventory that much easier and helps get shipments out the door faster.


Lack of Inventory Checks

Going through your inventory to reconcile what you have with what you think you have can be cumbersome and costly. Many companies only do it once a year and it’s usually a nightmare. By not conducting inventory checks more frequently you are increasing your risk that your actual inventory compared to your presumed inventory will be way off.

Takeaway: There are better ways to do inventory checks and you may even find that making a change will help it go faster and cost less. One of the most common inventory check solutions is to do it section by section over a period of time. That way you aren’t completely shutting down and smaller areas are easier to process quickly.


Lack of Accountability

Most companies fall into the trap of having too many cooks in the kitchen. That means when things start to go off the rails there is a lack of accountability.

Takeaway: Making sure that everyone knows what their responsibilities are when it comes to inventory management will help keep everyone accountable. When there is a lack of understanding about who’s in charge of what, you’ll find that some tasks will be duplicated while others won’t be done at all.


Proper inventory management is a must have a process to keep your warehouse running smoothly and efficiently. Even the most successful companies in the world have had to overcome inventory management issues. Watch out for these common mistakes and you’ll have a well-stocked warehouse in no time.