Have you ever wondered why your growth strategies are struggling, or worse, never come to fruition? It’s likely you and your employees are spending too much time on other areas of business like inventory management. Don’t get us wrong, your warehouse is a vital function in your business operations. It should be working
for you, not against you. If you are one of the 46% of businesses that currently
track their stock manually, using pen and paper, spreadsheets, or don’t track it at all, then you are wasting precious time each day. Too many man hours are used for sifting through piles of printed spreadsheets or handwriting inventory records. What’s worse is that you can’t make informed business decisions because your reports are not accurate nor in real-time. Before you know it, years go by and your business remains stagnant.
While revenue growth is the number one challenge for nearly half of
small businesses (which employ 11 to 50 people), only 9% report that they plan to implement an inventory management system. If you are still manually tracking inventory, then you are missing opportunities for lowering your costs, increasing profits, and realizing heightened productivity.
Here are five ways inventory management increases productivity
- Paper records will become a thing of the past
It’s time to ditch pen and paper in all facets of your
warehouse operations. With barcode scanners and a tailored inventory management system, you exchange piles of printed spreadsheets for accurate, real-time digital data that can be pulled up any time. Not only does it take just seconds to scan pertinent product information up front, you can later
pull up important records on your computer, rather than wait to print reports in Excel, which won’t be accurate to begin with.
- Less touch points mean decreased error
Even the most skilled typist will make an error every 300 keystrokes. Over time, those mistakes add up, and a number of those mistakes won’t be caught, especially with typing numbers. Using a barcode inventory management solution to automate the data entry process reduces or even
eliminates the errors that inevitably occur with a manual process. The ability to scan barcodes rather than manually entering SKU numbers character-by-character can also make a huge difference in time spent. When data is consistent and precise, it will positively impact quality control in the pick, pack, and shipping process as well. Specifically, front-end employees won’t have to spend time tracking where an error occurred and warehouse workers won’t end up sending the wrong orders, thus cutting down time spent processing returns.
- KPIs are closely tracked so employees can work toward your goals
In today’s marketplace, businesses need to have
a grip on key performance indicators (KPIs). KPIs are the “golden tickets” for your business, giving you measurable goals you and your employees can work toward each day. These goals can be anything deemed most important in your corporate culture, including high inventory turnover, lower carrying costs, order accuracy, product quality, customer behavior and satisfaction, and future plans for your business. Whatever you choose, be sure KPIs reflect your business mission statement and plan, so you will have measurable information going forward. This enables you to identify areas that need improvement and be able to continue to make progress towards your goals. Make sure employees across your organization adopt these KPIs. There will be a shared accountability throughout your organization, resulting in a higher-functioning operation. Using your KPIs to analyze and track performance and productivity will empower you to make strategic and reliable business decisions, going forward.
- Distribution will work more efficiently
It’s never a good sign when people are scribbling numbers onto a pad of paper or keying them on a keyboard. This frantic scrawling on a pad adds insult to injury, and certainly appears less professional to have operators hold a piece of paper, read its contents, then go to a picking location.
Yet organizations that harbor as much as 30 to 40 thousand item numbers across multiple facilities often seem convinced they're
better off without technology, according to
Inbound Logistics. If facilities have proper inventory management technology in place, operations will run more smoothly, employee performance will be enhanced, and the “hands-free picking” will be provide greater productivity and efficiency for your workers.
For instance, Bryan Bibeau, quality instrument specialist for the Ambient Monitoring, said the company
relied on a Microsoft Excel spreadsheet to list all of the parts housed in a central supply room and across multiple monitoring stations. With no automated inventory management process in place, the company struggled to keep accurate records of parts. In fact, parts stored in the field were only tracked on a clip- board at each monitoring station. Since implementing an inventory control system, the company is able to make better use of inventory dollars and they are able to store a broader, more accurate variety of items.
- More work will be done in less time
It used to take employees hours to accomplish certain warehouse tasks, which now can be achieved in minutes with
barcode inventory management. Scanning a barcode significantly reduces time spent on manually entering the information. Also, with the increased mobility, it allows workers to minimize “back-and-forth” time between their desk and the warehouse. It allows employees to significantly reduce labor-intensive, manual processes by instantaneously identifying items and automatically storing item information in your central inventory management system.
Bryan Bibeau shared that any time one of his technicians needed a replacement part, he would spend between two and three hours calling around to the various field technicians looking for it.
“Since we replace between four and five parts a week, as a group we were wasting between 500 and 750 hours a year just tracking down parts,” Bibeau recalled.
After investing in an
inventory management system, he relocated all parts to two central control supply rooms, neatly organizing all shelves and bins so all barcodes are easily scanned.
“Technicians avoid the frustration associated with hunting for parts. Plus, they can spend more time on high-value tasks.”
“What used to take hours now requires less than five minutes,” he said. “Technicians avoid the frustration associated with hunting for parts. Plus, they can spend more time on high-value tasks.”
Each second, minute, or hour you are able to shave off of each process means more time to accomplish other needs or allows you the luxury of moving on to the next project - increasing productivity and reducing labor costs. Any labor related to paperwork can be eliminated completely, as all information can be readily scanned, entering the information and storing it digitally.
The time saving reduction in operating procedures that your new system gives you will provide an easily measurable way to track your progress and success as you bring your business up to date and grow your company into the future.
How would implementing a dedicated inventory management system allow your business to be more productive?
