Inventory Control is not only about making sure that the physical count matches what the WMS or ERP software shows, It is about having the right mix of products to sell, about not having too little inventory or too much inventory, it is about controlling the flow of inventory from the manufacturers.
This article is about the right practices to make sure you have what you think you have in stock.
These principles apply equally to manufacturers, distributors and Even 3PL Companies who handle inventory for other companies.
Whether a shipment is being delivered via Ocean Freight or Air Freight

Necessary Inventory Control Practices

1- Before the product is shipping to the warehouse make sure it is labeled properly. Bar codes are essential. Make sure the vendor or shipper send an SKU list with the complete description.

2- As you receive a shipment, make sure you have a packing list to receive against.

3- As the Inventory is received at the warehouse, verify that the BOL quantity matches what the packing list states in pallets or master cases. Record any discrepancies.

4- Record Damages to the BOL and the Warehouse receipt.

5-Advise shipper of any Discrepancies.

6-Receive product in WMS system and send to Shipper ( Customer ) to verify

7- If the inventory exists in stock, count what you have in stock and indicate on the receiving report

8-Label all boxes or pallets received with Warehouse receipt number. Record the location of the Cargo.

Inventory Control and Shipping

1- The warehouse gets a pick ticket, the items are picked accordingly.

2- pack the products in a way where you know what is being shipped. Avoid Mixing of products as much as you can.

3- Report Insufficient inventory to office immediately. This means a discrepancy. It could be a shipping mistake or you just can’t locate the product. This needs to be taken seriously.

4- As you pick the product from inventory and you notice low levels of inventory, report back to the office using a low inventory level form.

5- As you pick orders, make sure you do a random verification of the quantity available in stock and annotate on the pick ticket.

6- If possible, have one person pick, another pack and another ship. This will cut down on the mistakes.

7- the last step is for a random check: take the packing list and verify that what you have on the doc is what is on the packing list.

8- Make sure order entry department, closes order to deduct from Inventory.

9- Perform random inventory counts on regular basis. That will save hours of doing a total count. Technically within a period of 2 months of doing the random inventory count, you would have counted the whole inventory.

If the above steps are followed, you should not have any issues with inventory discrepancies. Most of the mistakes happen during shipping or receiving.

In many organizations the opportunities to reduce inventory costs are often not addressed at all or are not completely exploited. If your organization needs help taking money out of inventory there are strategies you can employ today that will provide payoff.

Some of these strategies address having less active inventory, others how you acquire active inventory, and still others require transferring inventory or relying on vendors for better inventory management. Regardless of which you choose to explore, proactive inventory management policies will make a difference in your operations.

Here are Some Strategies:

1. Base Cycle Stock on Economics: For purchased products, getting a handle on your acquisition transaction costs will either reduce average inventory or allow for reducing purchasing and receiving labor. For manufactured products, if production equipment changeover costs are in a similar state, getting them in place will either reduce average inventory through shorter runs or allow for reducing changeover and receiving labor through longer runs.
2. Reduce Order Transaction Costs: In the office, use the computer to generate purchase orders (POs), EDI for PO transmission, advance shipping notices (ASNs) to reduce expediting, and historical vendor performance to prioritize expediting to lower purchasing costs. In the manufacturing plant, pre-planning; pre-staging of needed parts or materials; use of special tools or equipment; changeover initiation prior to completion of the previous run; teamwork and work-division; maintaining equipment temperatures; and minimizing QA / QC work all reduce cycle stock inventory. In the distribution center (DC), pallet manifest-based receiving processes, counting scales, statistics-based inspection and checking, bar code scanners for data entry, certifying key vendors to eliminate receiving functions, and stocking forward storage locations first and reserve locations second can all reduce purchase transaction costs and cycle stock accordingly. Purchase transaction costs are not normally SKU-specific. However, reflecting any extraordinarily low receiving costs associated with specific SKUs will serve to reduce inventory for them. The opposite, of course, is also true.
3. Lower Inventory Holding Costs: Improve space utilization in leased, contract, or public warehouses (or to minimize or delay expansion of owned facilities) through narrow aisle handling equipment, mezzanines, layout, or more appropriate storage modes.

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With the General Ledger module, you get complete, and timely financial information crucial to managing a successful business operation.

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If you are in the Wholesale Distribution Business, Protrac is your software.

ProTrac is a Serious Distribution Software

ProTrac distribution software has been specifically designed to meet the demands of the wholesale distribution industry with fast order entry, fast and powerful searching, with accurate and reliable forecasting!

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SWOT Inventory and Customer Analysis

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Professional Data Systems, Inc.
664 SE Bayberry Lane, Suite 105
Lee’s Summit, MO 64063

Call Toll-Free: 800-711-7374
Or Email: melc@pdsi.com

An Enterprise Resource Planning System, commonly known as an ERP system, is a set of business software tools designed to facilitate the flow of information between all departments or functions within a business.  The ERP system integrates information seamlessly throughout the rest of the company.  When the first ERP systems were designed over 25 years ago companies both large and small, used function-driven software for each area of their business.  For example, the accounting, purchasing, inventory, and sales departments each used a different software package which frequently didn’t talk or integrate with any of the other systems.  Reporting and tracking of even the most basic business activities across these different ‘data silos’ was tedious, error prone, and unreliable.  A well designed ERP solution has the ability to process information from every part of the organization, and any type of transaction, within a single, integrated-solution which can track–in real-time–business operations and provide timely, accurate information to business managers. No more need to export data from multiple systems do extra computations and arrive at the results from last month’s sales or production run. With a modern ERP system each person within the company has the information they need to do their job and it is available now – or as the technology folks like to say it “in real-time”.