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Most effective measures to reduce inventory cost in 2023

Inventory cost refers to the expenses associated with acquiring, storing, and maintaining inventory within a business. It includes various components, such as the cost of purchasing or producing inventory, carrying costs, and any other costs related to inventory management. Reducing inventory costs in logistics is a common objective for many businesses as it can improve cash flow and increase overall profitability. Here are several strategies you can implement to reduce it : 

Inventory Cost
Inventory Cost



  1. Demand forecasting :- Accurate demand forecasting helps you anticipate customer demand and avoid excessive stock. Analyze historical data, market trends and customer behaviour to make informed predictions about future demand.

  2. Supplier management :- Establish strong relationships with reliable suppliers who can provide competitive pricing, favorable terms, and timely deliveries. Negotiate better pricing, volume discounts and explore options for consignment or vendor-managed inventory (VMI) arrangements.

  3. Just-in-time (JIT) inventory: Adopt the JIT approach to minimize inventory carrying costs. Order and receive inventory only when needed, reducing the need for excessive stockpiling and associated holding costs.



    4) Optimize order quantities: Use economic order quantity (EOQ) calculations to determine the ideal order quantity that minimizes total inventory cost. Consider factors such as carrying costs, ordering costs and stock-out costs when calculating EOQ.

    5) Inventory classification: Implement an ABC analysis to categorize your inventory based on value or sales volume. Focus on optimizing the management of high-value items or fast-moving products while considering alternative approaches for low-value or slow-moving items.

    6) Efficient storage and layout: Organize your warehouse or storage area to maximize space utilization. Implement efficient storage systems such as vertical racking, labeling, and inventory tracking technologies to minimize the risk of overstocking or lost inventory.

    7) Regular inventory audits: Conduct regular inventory audits to identify and address issues such as stock obsolescence, shrinkage, or inaccuracies. Implement robust inventory control systems, such as barcode scanning or radio-frequency identification (RFID), to improve accuracy and visibility.



Inventory Audit
Inventory Audit


8) Collaboration and partnerships: Explore partnerships or collaborative relationships with suppliers, distributors, or retailers to streamline inventory management. Sharing sales data, forecasts and inventory information can help reduce stock-outs and improve overall supply chain efficiency.

9) Just-in-case inventory: Review and optimize safety stock levels by considering lead times, demand variability and supplier reliability. Avoid excessive safety stock that can tie up capital and increase carrying costs.

10) Continuous improvement: Regularly evaluate and refine your inventory management processes. Look for opportunities to eliminate waste, reduce lead times, and improve overall efficiency. Embrace technologies such as inventory management software, demand planning tools and automated order processing systems.

By implementing these strategies, you can effectively reduce holding cost while maintaining adequate stock levels to meet customer demand. Keep in mind that the optimal approach may vary depending on your industry, business model, and specific circumstances.

The primary elements of inventory cost are as follows:

1) Purchase Cost :- This is the direct cost of acquiring inventory from suppliers or manufacturers. It includes the price of the goods, transportation costs, import duties & any other expenses directly attributable to the purchase.

2) Carrying Costs :- These are the expenses incurred to store and maintain inventory. Carrying costs typically include warehousing expenses (e.g., rent, utilities, insurance), security, inventory tracking systems and labour costs associated with handling and managing inventory.

3) Holding Costs :-
Holding costs are the expenses incurred due to keeping inventory on hand for an extended period. This can include costs related to obsolescence, deterioration, damage or theft of inventory. It may also encompass the opportunity cost of tying up capital in inventory rather than investing it elsewhere.

4) Ordering Costs :-
Ordering costs are the expenses associated with placing and receiving orders for inventory. This includes activities such as order processing, paperwork, communication and transportation costs for inbound shipments.

5) Stockout Costs :-
These costs arise when inventory is insufficient to meet customer demand. Stockout costs may include lost sales, customer dissatisfaction, rush orders, expedited shipping charges and potential damage to the business’s reputation.

6) Financing Costs :-
Financing costs are applicable if the business uses loans or other forms of financing to acquire inventory. These costs include interest payments and fees associated with borrowing money to purchase inventory.

Calculating inventory cost accurately is crucial for businesses to understand the financial impact of their inventory management. By analyzing this cost, a company can make informed decisions regarding pricing, purchasing, reordering and inventory control strategies to optimize profitability and maintain adequate stock levels.

Supply Chain Management in India

Supplier Navigator: Future of Supply Chain Management in India

Since 14% of India’s GDP is spent on logistics, it is the need of the hour to explore supply chain management in India and devise strategies to improve it. The pandemic has wreaked havoc on global supply chains, and India is no exception. In order to ensure the continued recovery of the Indian economy, it is essential to address the risks and uncertainties within the supply chain. This will require innovative thinking and comprehensive planning.

However, the COVID-19 pandemic was the driving force that businesses needed to push for innovations in the supply chain. Surprisingly, even companies that were ill-equipped to respond to disruptive events and had limited resources rose up to the challenge by adopting analytical practices and technical standards to provide solutions.

But the challenge of building strong, reliable supply chains does not end here. It would require constant effort, effective upgrades and rigorous risk assessment and management to ensure supply chains stand the test of time. Companies worldwide must rethink their business models to create agile and resilient supply chains that help stabilise growth and ensure sustainability. This would mean relying heavily on digital technologies and agile methodologies to respond efficiently to the ever-evolving technological domain.

India has the potential to be a leading force in the global market – this is thanks to the country’s natural resources and the intelligence of its citizens. There are numerous opportunities for those aspiring to become supply chain managers so that they can align their skills with the needs of the country. By acquiring a Master’s Degree in Supply Chain Management, individuals would be equipped with the analytical approach required to make effective decisions for the future of India’s supply chain.

India has the potential to adapt to the emerging challenges and recover stably in the post-pandemic world, with the backing of cutting-edge technologies, an active interest in the diverse cultures around the world, and a skilled workforce.

The Future of logistics & Supply Chain Management In India : Global Trends, Predictions, and Opportunities

With traditional supply chain strategies being replaced by more cost-effective technological interventions, companies will need to rethink their business models, diversify their manufacturing processes, and explore different trade channels. This shift will require companies to be more agile and adaptable in order to stay competitive.

Top 5 Express Delivery Services In India

The On-Demand Top 5 Express Delivery Services In India – Making Delivering Hassle

Globalisation has changed the way we do a lot of things, including online shopping. With more and more people interested in eCommerce, Top 5 Express Delivery Services In India there is a need for new and innovative shipping solutions that can keep up with customer demand.

Shipping – Your Trusted Air Express Shipping Provider || Top 5 Express Delivery Services In India

The global trade and consumer markets have grown into thriving and extremely profitable industries, making businesses go international and prefer those ventures that can deliver their goods quickly. Today, although there are several means of shipping goods, airways are considered to be among the quickest, express delivery services in india easiest and most convenient options for many businesses. […]

Express logistics services in india

Top Express logistics services in india – Om logistics

Express logistics services in india is a top transport company in India that has been catering to the various modes and requirements of the road industry for many years. They have evolved into a trucking company that owns and operates its own fleet of 1500 trucks, which makes them one of the leading transport companies of India. They are able to meet the requirements by hiring from the markets on a spot basis, which keeps their business running smoothly.

Express logistics services not only provides dedicated vehicles on a long lease basis, but we also cater to various industries and offer tailor-made services to meet the right fit requirements of our customers. Over time, we have become known as a dedicated trucking company because we understand how crucial trucks are to keeping the country running. They offer greater flexibility as well as ease when compared to the movement of cargo through multi-modal modes like rail and air. In India, trucking companies enjoy the majority share of the overall movement of cargo, and we’re proud to be a part of that.

There are many transport companies in India to choose from, but when it comes to finding the best, Express is second to none. With its vast and spread-out network, Express is known as one of the best logistics companies in India with a legacy that spans 25 years and counting.

Express logistics services in india || Retail Express services

Freight Forwarding services in India

Choose the Top Freight Forwarding services in India

A freight forwarding services company can save you a lot of time and hassle when it comes to logistics. They can help with things like booking space on a vessel, arranging cargo insurance, and monitoring the movement of your cargo in real time. This way, Freight Forwarding services in India you can focus on more important things like running your business. So if you’re shipping cargo, make sure to partner with a professional freight forwarding servcies in delhi.

Freight Forwarding services in india provider

Freight forwarding is the process of shipping goods from one location to another via a freight company. The freight company picks up the goods and delivers them to the final destination. The goods can be shipped via truck, ocean, or air freight, depending on various factors.

Warehousing and Distribution

Top Warehousing and Distribution In india

A warehousing and distribution is a large commercial building for storing goods. The goods commonly found in warehouses include machinery spare parts, building materials, finished agricultural goods, furniture and electronics. Some of the activities that take place in a warehouse include receiving goods, offloading goods, warehousing and distribution in india forklifting goods and stacking the goods.

Warehousing is the coordination of all activities related to acquiring goods from manufacturers, storing them, and making them available to consumers. Distribution is the process of making goods available for consumption by business users and final consumers. A combination of warehousing and distribution involves acquiring goods from manufactures, storage of the goods, and making the goods available to consumers.

Best Warehousing and Distribution In india

A warehousing and distribution service provider is a company that stores and manages products on behalf of an organization and then delivers these products to customers at a given point of time. They play an integral role in any company that is concerned with delivering products to customers without any delay or issues. Companies, when hiring the service of a warehousing and distribution service provider, make sure these providers are capable of meeting the huge demands of customers and are able to deliver the products on time and as expected.

Door to Door Express Services in India

Door to Door Express Services in India – Understanding the Benefits and Challenges

Door to door express services in india – is a type of delivery in which items are transported from one location to another without the need for the recipient to be present to receive the goods. This type of delivery is often used for large or heavy items that cannot be easily transported by the customer, such as furniture or appliances. Door-to-door courier service is also sometimes used for high-value items that require extra security, such as jewelry or electronic devices.

Door-to-Door Delivery – The Ultimate Solution for Any Business – Door to Door Express Services in India

Door-to-door delivery is a term that is often used in the logistics industry but it can be confusing to understand what it actually entails. In short, door to door delivery means that the seller will deliver the products directly to the buyer without them having to lift a finger or worry about organizing different agencies to get the job done. This type of delivery is convenient and takes away a lot of the stress that is often associated with shipping products.

Door-to-Door Delivery


Top 10 logistics companies in india

Top 10 Logistics Companies in India –The Most Popular Trends among 

India’s transport sector is the largest in the world, growing at an average of 10.5% per year. However, it’s still lagging behind a bit when it comes to implementing advanced technology. Only the top 10 logistics companies in India have been able to take advantage of these advancements, which has in turn increased their efficiency.

Therefore, the future of the warehousing companies in Delhi relies on innovation, with technology serving as the crucial source of it. Some of these innovations include analyzing product demand data and executing predictive shipping. This helps in delivering the products efficiently to the destination before an order is made. In this blog, we are going to talk about some of these technological trends that you can adapt to make your logistics business more efficient.

How logistics companies in India have implemented technological trends in their business

Best Logistics Company in Mumbai

The Best Logistics Company in Mumbai You Can Count On

Mumbai is the economic capital of India and is known for being a hub for business and commerce. Many companies have their headquarters or expanded branches in Mumbai, which has resulted in the city becoming one of the main places where logistics companies operate. These logistics companies provide both national and international shipping services, Logistics Company in Mumbai – ensuring that products can be transported to and from Mumbai with ease. With there being a lot of logistics companies based in Mumbai, it can be tough to choose which one is best for your business.

To help you make a decision and find a logistics company in Mumbai that you can trust, we have compiled a list of some of the best providers in the city.

Top Logistics Company in Mumbai

– If you’re in need of a good warehousing company in Mumbai, here are some of the best ones that come highly trusted:

3PL / Warehouse Services

Best Warehousing Companies in India – 3PL logistics companies in india – Om Logistics

Our services are little bundles with enormous impact. With our Warehouse and Distribution Network Services, we manage your supply chain with integrated pool distribution, cross docking, warehousing and transportation solutions. We manage more than 15 million sq. ft. of warehouse space at various areas the nation over. Our warehouse services firm provides custom integrated transportation solutions. Our warehouses incorporate a blend of worked to-suit, 3PL logistics companies in india committed and multi-client stockrooms. Our system runs on a structured process flow for each sub operation and for tracking metrics. Our Warehouse and Distribution Network Services offer short-term and long-term options as well as customized solutions. Our clients also benefit from a co-op delivery system that utilizes shared routes to drastically reduce transportation expenses and the savings are passed directly on to you. Our group is developing world-class warehousing facilities at key industrial hubs across India.

what is warehousing companies in India || 3PL logistics companies in india

4pl logistics companies in india

what is 3pl warehouse

Services Offered

Provision of extended sales office for your organization’s network reach
Flexible options of warehouse utilization i.e. sq. mtr / CBM / pallet positions
Material security and safety
Modern infrastructure and handling solutions
Bonded and non bonded facilities
Facilities in SEZ locations (excise free area)
Providing robust warehousing solutions
Storing and managing inventory
State-of-art warehouses are equipped with modern material handling equipment
Great workforce for efficient logistics coordination
Item-wise / location-wise inventory management with traceability, recall capability, ageing analysis
Smart packaging solutions / article tagging/ quality check
Order management to ensure on time delivery
Packaging solutions with quality check
Provide kitting services
Strong cross-dock – easy flow through, VAS with quick transhipment facility
Warehouse management solution integrated with ERP systems
Our Warehousing/Factory Shed Facilities’ footprint reaches across

Mumbai Delhi and NCR
Bangalore Chennai
Kolkata Ahmedabad
Haridwar Noida
Pune Rudrapur

Key Capabilities for 3PL Solutions

Just In Time Supplies (JIT) DI system
Direct On Line Deliveries (DOL) Combio of JIT and DOL
System and Management of “SPD” Concept of “Small is Beautiful”
Bin Charging Kitting and Consolidation
Milk Run Application Distribution through Hub & Spoke System
Introduction of Recyclable Packaging Material Total Inventory Management
First In First Out (FIFO) Total Supply Chain Management
Relocation of W/H as per Govt. Levies Bonded & Non – Bonded Warehousing
Clock Room Facility Order Processing
MIS (management information system) Pre-delivery Inspection
Space for Segregation Space for Testing Equipments
Bar Coding / KANBAN Movement with Mobile Communication
Dedicated Vehicles / Designed Vehicles Logistics Related Manpower Support
Tracking and Tracing through GPS Escorts Service