Even the best product and marketing plan in the world could still result in a spectacular failure if you fail to take into account the very important matter of logistics. Here is a look at four questions you should be able to answer before moving forward with your business plans.
Where will you store your products?
You might be planning to rent a facility and employ your own staff, particularly if you want to have as much control over operations as possible. However, facilities generally operate on long-term leases, and startups can’t always predict what their needs will be from the get-go. This is where third-party logistics firms or fulfillment houses can come in handy for their expertise and cost advantages.
How will you deliver your products?
There is also a good chance you’ll need a third party to help transport your product. While price is always an important consideration when you’re just starting out, you should not underestimate the importance of having experience in delivering to the market you are targeting.
How much inventory should you keep on hand?
The prospect of determining the right inventory levels without having any sales history to consult can be very tricky. You’ll simply have to make your best guess. This is why getting the best deal possible from your suppliers can make or break your business, unless you decide to go with a drop shipper.
How will you manage your inventory?
Once things get off the ground, you’ll need a solid ongoing method of determining how much stock you currently have, how much is on its way, and how much you are going to need moving forward. Many startups find the best course of action is a simple spreadsheet with an agreed process that can be adjusted and recalculated as needed. This solution is affordable, adaptable, and easy to access and use.
This blog post was based off an article from Paul Trudgian Consulting. View the original here.