For most independent retailers, inventory is likely your largest investment, and in challenging economic times, tighter inventory control becomes money in your pocket.

Here are a few of the most important inventory management pitfalls to avoid:

Carrying too much variety
We know that inadequate inventory and selection can mean lost sales, but too much selection can mean much needed funds tied up unnecessarily. Take a close look at your product selection to find opportunities to trim the width of your selection and keep more cash in your coffers.

Pushy vendors
Vendors want to clear out inventory and would prefer to push it down the supply chain to you. In many cases this could result in some favorable deals and perks, however, avoid the trap of ordering items or quantities that you don’t absolutely need. Push back on pushy vendors to avoid this mistake.

Ordering too infrequently
The closer you can get to just-in-time ordering, the better. Gone are the days of ordering and holding large inventories. To improve your cash flow, create a leaner inventory by ordering more often and improve your forecasting and budgeting capabilities.

Lack of planning
Lacking effective forecasting and budgeting will no doubt stymie your efforts at inventory management. You may need to upgrade your inventory management system, but the expense may be well worth it in the money you save.