A business without an inventory management system often experiences losses. Effective inventory management ensures that you have the right amount of stock when you need it. So, alongside inventory management software, companies tend to adopt a certain inventory management technique. Here are three popular ones that companies use: 1. JIT delivery: JIT delivery stands for just-in-time. This means that the company only orders and ships new inventory as and when it’s needed. The core aims are to reduce waste, save warehouse space, and improve efficiency. It’s a popular system among many big businesses—especially those with large and expensive inventory, such as Toyota. 2. Dropshipping: Dropshipping is a form of inventory management that allows businesses to sell products without stocking or sending the items themselves. Often, these merchants won't have physical stores at all. The vendor acts as a go-between for the customer and the supplier. The core aim of dropshipping is for the retailer to focus on other elements of the business, such as sales and marketing, while another company handles the inventory. Amazon uses dropshipping. 3. ABC analysis: ABC analysis approaches classifying inventory based on its consumption value. The approach comes from the Pareto principle – the idea that we get 80% of our results from 20% of our action. The ABC analysis uses A, B, and C to rank the consumption values of the inventory: A are the goods where annual consumption is highest B are the goods in the middle C are the goods that have the lowest consumption value As such, inventory is ordered and stocked accordingly. H&M uses the ABC analysis approach, making 80% of its retail inventory in advance and introducing the remaining 20% based on the most current market trends.