Inventory accuracy is paramount to an efficient warehouse. Unfortunately, many wholesale distributors fall short of their competition due to disorganized inventory or inaccurate information. Inventory accuracy impacts other key performance indicators, such as:
- Units picked and shipped per hour
- Order cycle time
- On-time shipments
- Warehouse capacity used.
The time and money it would take to get control of your warehouse is miniscule compared to what you could save by setting a higher standard of efficiency. In order to ensure your warehouse’s inventory accuracy, be sure to think about these 5 key points:
- Implement a cycle counting program. Conducting regular cycle counts versus a once a year inventory count allows you to catch and correct errors sooner.
- Keep track of lot information. Not a single warehouse manager wants expired inventory sitting on the floor. Likewise, not a single customer will be happy to get expired product. Failure to correctly track lot information can cost you not only money but customers as well.
- Set accuracy standards. Receive, put-away, pick, and counters should all be held to accuracy standards. Amazon.com for instance, has a 99.75% accuracy target for associates counting inventory.
- People. Having the right people in the right positions who have been properly trained can do wonders for inventory accuracy.
- Invest in technology. Invest in a Warehouse Management System that allows you to track your inventory. Then invest time in being able to maximize the abilities of that software to help you stay on top of inventory discrepancies. Your Warehouse Management Software should take a snapshot of your inventory when you begin the cycle count and then process transactions after counts have been entered. That allows locations to be picked from, even while the location is being counted.
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