Some Considerations For Inventory Management

In general, we accept the established processes of inventory management as something natural and, even more, to consider as valid the set of activities that have always been part of the company.

Although, who defined it? What is the benefit? We cannot define it, but we use it and hardly question it. In planning inventories, several factors must be taken into account to minimize the probability of errors. Learn some keys provided by the top inventory management firms to have a more successful process.

The accuracy of inventories comes from worn out models that hierarchically subordinate the warehouse to the accounting area, which maximize the need to develop general inventories that allow them to have more accurate information.

All this effects the annual result of the tax return, thus inheriting assumptions about effective management to increase inventory accuracy, but how necessary is a general inventory at the end of the year? Is there any work to replace it?

A general inventory requires planning that minimizes the probability of counting errors, taking into account the following considerations we could achieve the expected results of this work:

Establish the process. It is advisable to consider types of counts, starting with a 100% scan and taking the information from our records as a reference point.

Then focusing your efforts on the second count to correct or validate the differences that were shown in the first and a last count is done by the between the warehouse manager and the inventory manager.

It is necessary that the last count serve to ensure the difference found and that it be accepted by the warehouse manager, having exhausted all probability of sustenance of the differences, avoiding suspicions in the subsequent sustenance.

Support differences by observing possible crossings. Where to start? Operational errors are more frequent and have greater access to information in articles with similar characteristics in which it must be identified if the difference is justified between them.

A third party must make the difference adjustments. To maintain transparency in the process, a person from outside the warehouse must update the actual and found quantities in the system.

Inventories carried out by management companies. Outsourcing work with a company that provides this service can help a lot, when articles have a high degree of complexity for recognition. It is preferable to carry out the task with inventory management companies.

Cyclical inventories. The key is not to wait until the end of the year to take control, a policy of continuous monitoring through cyclical inventories will favor the reduction of error margins, operating processes and the accuracy of the information.

The association of these considerations are the most solid arguments to disrupt those premises that establish the general inventory taking as the only accepted methodology at the end of the year.

According to the best inventory management companies, this planning contributes to the continuous improvement plans working on the causes of the process and of operation that affect the accuracy of the inventory, so we could determine that it should be implemented or improved regarding visual aid tools, standardize processes or review the information in the material catalog.

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