Inventory Management Techniques To Increase Business Productivity

By implementing a solid collection of inventory management methods, your business can reduce its expenses significantly! If you want to be successful or continue being successful, then you need to implement improved inventory management techniques.

If you wish to remain competitive and profitable, then you would need to learn and use as many profit-boosting and cost-saving inventory management tools and techniques as possible. Here, we have listed a few of them to make your business more productive.

About Inventory Management

Inventory management comprises of a set of techniques, strategies, and tools, for the purpose of tracking, storing, ordering and delivering stock or inventory. Controlling inventory in the right way helps in maximizing profit and minimizing losses.

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Inventory Management Techniques

Below is a list of some of the most popular and effective inventory management techniques that you can use to improve your business.

Economic Order Quantity

It is the lowest number of inventory needed to meet the peak demands of customers without having to go out of stock and producing obsolete inventory. Its objective is to lessen inventory to an extent to keep its cost low.

Minimum Order Quantity

It is the lowest agreed amount of inventory that any supplier is keen to sell. If you fail to buy the “MOQ” of a certain product, then your supplier would not be able to sell it.

The objective of minimum quantities of order is to enable suppliers to enhance their profit, eliminate excess inventory quickly and eliminate “bargain shoppers” too.

ABC Analysis

ABC inventory analysis aids in maintaining low levels of “working capital costs”. This analysis procedure to sort your inventory into three categories as per how much they cost and how well they sell.:

  • A-Items – Best-selling items
  • B-Items – Mid-range items
  • C-Items – All the rest inventory except A and B categories


Poor management of inventory can lead to loss of revenue, loss in share in the market, and loss of customers. So, for successful business operation, it is very important to adopt the right inventory management techniques. These are the different methods of inventory management to enhance your business operations.