On-topic, here are some common inventory issues we’ve uncovered:
No matter how great your software or how well-automated your system, there is always that critical human element to managing inventory. Poorly or inadequately trained employees who do not fully grasp your inventory process or are not motivated to master your rotation regime are liabilities.
We’ve seen companies handle this issue successfully. First, designate at least one person who is well acquainted with your inventory system and can train new employees, oversee the warehouse and all the shipping operations. This person should be experienced in handling inventory problems as they arise and be an expert in training and motivating others to do the same. They should be able to identify shortages or the probability of running out of stock before it happens by conducting regular stock audits with detailed reports on inventory levels. They will become experts at calculating how much stock to order and use inventory management tools to optimize their procurement. And lastly, and most importantly, this person can accurately forecast how much inventory you may need at that particular facility in the following order cycle.
Properly trained employees will shorten your lead time and save you money downstream while building you a brand known for reliability and appreciated for efficiency.
These days there’s a much “muddier” international trading scenario. To some extent, we are all being forced to adapt by accommodating the global “quirks” in the supply chain. It’s common to run into an increased number of partners, less reliable lead times and increased tracking issues. As businesses expand their product offerings, they put additional pressure on warehouse space and inventory processes. Meanwhile, stock levels need to be optimal to ensure availability and, at the same time, not risk investing more working capital than is wise.
The best way to address these issues lies in some combination of the following:
Under-forecasting is something we see all the time – people getting sucked up into day-to-day operations and losing track of the big picture. This may seem like a no-brainer, but it is a very common issue.
And while none of us can accurately predict every possible thing that could happen in the future, it is prudent to set aside valuable time to study leading indicators. This way, you are always as prepared as possible to handle every upcoming surprise.
Explore systems that can automate your processes and help you alleviate inventory issues.