Whether your company produces the raw materials, manufactures parts, assembles the final product, or performs some combination of all three, in-house inventory management can be an organizational nightmare.

Products being pushed down a conveyor belt in an in-house manufacturing operation.

That’s compounded when you include storing the finished product on site. Managing sales inventory, packaging, labeling, and shipping your product in-house can both take time away from in-house manufacturing and cause some major headaches for inventory management within your storage space.

Beyond the ability to efficiently label, assemble, pack, and ship your product, fulfillment services also often include warehousing and inventory management. Capitalizing on off-site storage is a cost-effective way to optimize your inventory control by clearing your on-site final product inventory. It’s about more than cost savings, though they can be substantial. Saving your company time, energy, and space can help you stay more efficient and organized. The added time is a boon to both your product and your customer, as you can focus more on customer care and refining your product.

How much you lean on your fulfillment company to assist in inventory management can vary. Accurate forecasting models and predictable sales spikes and create a very casual interaction, built on routine inventory transfers. Flexibility on the fulfillment company’s behalf is what can make the relationship truly worthwhile for your company. Irregular sales patterns and storage fluctuations can be hard to coordinate, and having a fulfillment company that can be responsive to complex sales cycles and storage needs can actually help you stay more organized during less stable sales and production periods. An outside perspective on inventory counts can also lead to greater clarity on issues that arise in the process. In exchanges that involve thousands of products, secondary and tertiary counts can either help illuminate inventory count issues or resolve false alarms. The extra input when it comes to inventory management can actually improve control systems.

Someone performs inventory management in an office packed full of boxes.

There’s a reason that over 80% of Fortune 500 Companies and over 90% of Fortune 100 Companies utilize fulfillment and third party logistics centers.The time not spent by businesses on inventory management and fulfillment is time spent crafting your brand like Nike, or delighting your customers like Dollar Shave Club. More than just saving you money, time, and energy, leveraging fulfillment centers properly provides your company with the means necessary to become more valuable to your customers. Increasing current customers’ lifetime values is one of the most valuable endeavors a business can undergo.

Image result for lifetime value of a customer

An equation clearly depicting how you can calculate Customer Lifetime Value.

Growing a business is hard. It’s hard before you ever sit down and think about all the different aspects that go into it. Most of the time, it’s only after a business has considered how they’ll go about increasing production, staff, and marketing efforts do they realize that they haven’t thought about how they’ll scale their storage, shipping, and inventory control methods. This may be the most beneficial aspect of a partnering with a fulfillment center: the ability to scale your storage, packaging, shipping, and inventory management processes seamlessly.