Storing excess inventory can have a negative effect on your business or company. To get a better understanding of why that is, continue reading this guide for how excessive inventory affects distribution.
Your Profits Decrease
Most businesses want to get rid of excess products as quickly as possible. They may do this by putting their product on sale or clearance to entice clients and customers to buy the product. Unfortunately, many times, these excess products are purchased at a value that is lower than what the product is worth. This is why profits decrease when a business has excess inventory.
The Relationship Between Storage Space and Cost
Not only does a company need to find a way to store excess inventory, but they must also find the money to store it correctly. This excess inventory takes away space from other inventory items that could sell at a faster, more productive rate. In addition to taking space away from better-selling items, it also costs the company to move and manage the products. The company must consider the utilities and expenses to do so as well. No business leader wants their employees to waste time moving and organizing excess products when they could be doing other tasks that are more beneficial to the company’s success.
Products Are Wasted
An even greater downfall to having excess inventory is that some products simply go bad. Many products that have expiration dates must be thrown away because they are no good and can no longer be sold for a profit. Companies that sell produce or other food items should never keep excess inventory in storage for too long, as they will likely go bad.
While most companies keep excess inventory as an accident, businesses should do everything in their power to ensure this doesn’t happen. Here at 18 Wheels, make sure that our centers for warehousing and distribution in Vancouver won’t lead to negative situations with excess inventory.
When looking at how excessive inventory affects distribution, you can easily see how negative the practice can be for your business or company. Be proactive and take the necessary steps to avoid such scenarios.
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18 Wheels Warehousing & Trucking Limited
Burnaby Terminal, BC T1
7185 11th Avenue, Burnaby, BC V3N 2M5
Tilbury Terminal, BC T2
7708 80th Street, Delta, BC V1B 6A9
Annacis Island Terminal, BC T3
780 Derwent Way, Annacis Island, BC V3M 5P8
Richmond Terminal, BC T4
9920 River Drive, Richmond, BC V6X 3S3
Burnaby Terminal, BC T5
2864 Norland Avenue, Burnaby, BC V5B 3A6
Vancouver, BC T6
525 North Skeena Avenue, Vancouver, BC V5K 3P5
Vancouver, BC T7
3438 Lougheed Highway, Vancouver, BC V5M 2A4
Nanaimo Terminal, BC T8
1890 E. Wellington Rd., Nanaimo, BC, V9S 5L0
Kelowna Terminal, BC T9
720 Evans Ct, Kelowna, BC V1X 6G4
Calgary Terminal, Alberta T10
4990 68th Ave SE, Calgary, AB, T2C 4N8
Toronto Terminal, ON T11-A
8460 Mount Pleasant Way, Milton, ON, L9T 8W7
Columbus, Ohio T12-A
433 London Groveport Rd, Lockbourne, OH 43137 USA
Washington, USA T13
3025 S. Geiger Blvd, Washington, 99224 USA
13046 Racetrack Rd. Ste. 190, Tampa, FL 33626 USA