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Tips for Lowering Inventory Costs for a Landscaping Company

Tips for Lowering Inventory Costs for a Landscaping Company

If you’re a business owner or manager it can sometimes feel overwhelming trying to balance what tools and products your business needs with how much of each thing you should get. The last thing you want to have is your inventory overflowing with materials that you can’t use that you’ve paid for but don’t have a hope to use. You need to take an honest look at your company’s purchasing, spending, and using habits in order to tame inventory chaos and ultimately keep money in your pocket.

Here are some tips for lowering inventory costs so your landscape company can thrive and you can rely on a system that will get your cash flow moving in the right direction.

Start With Spring Cleaning

Landscaping is a business founded on being able to bring the greenery that exists in a client’s head to real life. That often requires using various machines and tools to do so. These can range from the often-used lawnmowers to trenchers you might use a couple of times a year if you’re hopeful. It’s awesome you’ve been able to grow your business and purchase the materials and machines you need to do the job, but sometimes these things can be clogging your inventory and taking up valuable space.

Sometimes saving money means downsizing to a smaller but more well-organized storage facility. To make a move like this you have to also trim the fat and do a little spring cleaning and make tough decisions about which equipment and products to keep and get rid of. Stuff you’re not using is stuff that’s tying up lots of cash in inventory, so a good start to lowering inventory costs is getting rid of the unused materials.

Get An Ordering Process

The accumulation of lots of unused products can be a symptom of a much worse problem – a haphazard ordering system. If your business needs something, consider holding off on sending an employee to a local hardware store to pick it up because that can often start a long chaotic ordering system, and it’s a long road back to order. Missing receipts, people grabbing multiples of the same thing, and product serial numbers not being recorded can all happen as a result and can lead to a cluttered and cash guzzling inventory.

Streamlining your business’s ordering process is a simple way to know exactly what you’re buying and how much you’re spending on it. That way you don’t get two people buying the same leaf blower because one couldn’t find it in storage one day and just assumed you were without.

Develop A Relationship With Trusted Local Vendors

A handy trick to streamlining any ordering process is to talk to the people you’re ordering from. They’re just as invested in the products you’re buying so it makes sense to consult them during the process of purchasing them. By developing a relationship with vendors, your landscaping company could potentially hear about deals and sales unavailable to the public as well as know about products coming out that would be a good fit for your services.

A personal relationship is also helpful with inventory management because a vendor representative may be able to come in and take stock of what products your company needs and order them for you. The more times you repeat this process the easier it gets for them to know what and how much to get, and the more money you’ll save with your inventory.

Do The Math

Part of creating a cost-effective inventory is knowing exactly how much of each product you’re going to use. Stuff like topsoil, mulch, fertilizer, gas, and oil for machines may not seem like things that you should be tracking, but the more accurate you get at tracking them the easier it will be on your company’s finances since you’ll always order the correct amount.

Really look into how many bags of products you go through in a standard week and see if you can devise a way to estimate how much you’ll use depending on the property size, location, and type of job. Once you’ve got it all down to a science there’s no way you won’t be saving costs.

Predict Where The Market Is Heading

Step back from a reactive headspace where if you run out of something you immediately go off and buy a replacement. That’s a good way to make unsustainable purchases and miss out on good deals. Instead, buy in bulk items that you know you use plenty of and try to predict where you see the market going for those items in the future.

If you know from experience that fertilizer prices jump early on in the spring, consider buying in bulk enough to last you through that initial spike to save you a few extra dollars year-round.

Leave It In The Hands Of Capable Software

If all of this is sounding like a lot of record-keeping that would be easily streamlined through inventory keeping software, then no worries because other people have felt the same way. Arborgold has created a supply chain management feature on its software to optimize your inventory and purchasing habits. It tracks products you have in storage and predicts what you’ll need based on upcoming jobs and other purchasing habits.

Another bonus is that this software compares and contrasts vendor prices and keeps a close eye on what price points competitors are selling their products at so you know if you’re getting the best deal possible. With inventory optimizing software you can save valuable time and money while setting your business up for success.

Above all else, the number one tip for lowering inventory costs for a landscaping company is just to learn as you go. Companies change all the time, customer bases grow, and prices change so make sure you’re being flexible with your purchasing decisions and looking out for potential pitfalls and opportunities for more cash flow so you’re not stuck in a potentially unprofitable inventory system. Your business starts with what services you can provide, so making sure your inventory is as cost-effective and as streamlined as possible only further sets up your company for success.

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