Push or Pull Fulfillment: Which is best for your company?
To keep costs and overstock inventory down, each company must manage company demands through an effective inventory control system. The two most common of these systems are push and pull system models. Learn how to establish which inventory method works best for your organization, through learning how both methods work.
When implementing a push system of inventory control, the company uses inventory forecasting in order to meet customer product demand. The forecasting process involves predicting how much of and which goods to have in stock for the consumers to purchase. The company then produces these forecasted goods, in order to sell, or push, them to the purchasers. This can be good, when the forecast is accurate, and the company has enough product readily available to handle the supply and demand. When the forecast is not accurate, the company either has to deal with the added expense of storing the extra inventory, or scramble to keep up with the over-anticipated demand.
A pull inventory control system starts with a customer’s order. When using this strategy, companies only produce enough products to fulfill placed orders. This method eliminates the issue with having to store additional inventory, but companies can run into other order-filling issues, such as problems with a supplier delaying a shipment. This can lead to an inability to fulfill orders on time, which contributes to customer dissatisfaction.
In hopes of implementing the best portions of both control systems, some companies use a strategy known as the push-pull inventory control system. The push-pull system, also known as the lean inventory strategy, casts a more accurate forecast of product sales. This method focuses on actual sales of goods, while adjusting inventory levels for long-term and short-term production needs.
Choosing which method is best for your business is not an easy task. It is often difficult to know how much of what to order and when. Here at BilityPrints, we support all inventory control systems, to make sure our customers–and our customer’s customers–are completely satisfied with every order placed. Have questions about your specific-business needs? Contact us today. We are always happy to help!