Tire Business Should Manage Inventory Like This

Tire Business Should Manage Inventory Like This

As the tire market gradually recovers, distributors and wholesale tire companies find their previously dormant warehouses becoming active again. However, some inventory-related problems still plague dealers and stores; though business has improved, having high inventory levels for almost a year has made many tire industry professionals hesitant about stockpiling.

Stockpiling is the biggest challenge for quality tire salespeople

As inventory levels increase, the amount of capital tied up also increases, which decreases risk resistance. However, stockpiling too little means missing out on opportunities to make money when the market improves in the future. Therefore, whether to stockpile or not has become the most frustrating problem for many tire salespeople. Inventory is like a shock absorber for demand fluctuations, and having the "just right" inventory level and the most suitable market commodities at the right time is the key to successful tire sales. After decades of development in the tire business, the tire supply chain system has become very mature, and distributors and stores could have been very intimate allies. Unfortunately, we found that many stores have deep grievances against distributors.

As the most important link in the supply chain, distributors connect the upstream and downstream markets. They not only know the demands of downstream stores but also understand the sales policies and price trends of upstream manufacturers. By analyzing changes in market trends or operating trends, they can predict the inventory levels of their retail branches and adjust their total inventory changes in the region. Therefore, establishing a stable relationship with distributors can ensure that the wholesale tire company can control their inventory and have over 70% of their tire inventory tailored to customer needs. After all, distributors make reasonable predictions based on sales conditions throughout the region. Only the best-selling products can make tire stores profitable in a not-so-good market.

Good-value tyres salespeople should avoid a one-size-fits-all approach

For wholesale tire companies, especially new tire dealers, categorizing inventory by region is essential, and a one-size-fits-all approach must be avoided. Because brand and tread preferences vary by region, dealers must face the challenge of inventory classification. Because the scope of activities differs, the actual demand for tires in different regions also varies. Therefore, as a critical link in the supply chain, distributors need to thoroughly understand changes in local commercial activities and provide accurate feedback on the upstream tire factories. By driving data, they can adjust regional sales strategies and product layouts to better meet customer needs and maximize investment interests.

As sales-driven key data, real inventory counts and inventory circulation in different regions are crucial, including the inventory changes for high-quality tires sold locally in terms of size, quantity, and brand. By recording inventory and sales conditions daily, determining which brands are "trending upwards" can help improve store product layouts and increase inventory flow, providing the basis for the next investment cycle.

Top-quality tyres inventory turnover is essential

Now, we have come to the most critical stage of inventory turnover- the shorter the turnover time, the better the market conditions, and of course, the more tires available for sale. However, due to different sizes and sales of different stores, wholesale tire companies' inventory turnover rates vary. Therefore, finding and maintaining their own inventory circulation rhythm is the most important aspect. If the entire region has circulation that exceeds the normal cycle days, clean up the inventory as soon as possible to keep your capital steady. However, if the situation is the opposite, adjust the inventory brands and product combinations as soon as possible to reduce "sunk costs".

AULICE TYRE is a renowned Chinese tire company providing a wide range of reliable tires to customers worldwide. We specialize in producing superior quality tires for passenger cars, light trucks, SUVs, and commercial vehicles. All of our tires are made with advanced production technology, high-grade materials and strict quality control. Our products are designed to provide customers with reliable performance, superior comfort, and excellent safety. We are committed to delivering the highest quality tires at competitive prices to ensure the best customer experience. Please feel free to contact us for more information.

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