Editor’s note: This post was originally published in December 2018 and has been completely revamped and updated in October 2022 for accuracy and comprehensiveness.
When you want to improve your inventory management, you need every process to move like a well-oiled machine. As one of the last and most important steps in the retail pipeline you never want picking to be the step that slows you down. But your machine won’t work if the parts don’t fit together well. This is where effective inventory management and organization come into play. A great layout that makes the most sense for your space can assist everyone in pulling inventory quickly and easily. Improving Inventory management is rarely easy, though. Space and time limitations, the constant in and out flow of product, and the sheer overwhelming feeling. That comes with tackling such a big task, can cause re-organizing your inventory space to fall by the wayside way too often and for far too long. The following steps can resolve these issues.
These are 5 steps to improve your inventory management
1. Stock Optimization Starts With Space Assessment
What’s happening? Where is it happening? And is that the best possible place for it to be happening? There are a few questions you need to ask when deciding on the most efficient layout for your picking space. Of course, keeping things at ground level, whenever possible, will help make picking easier and faster. But without ample room and well-planned paths to navigate. Even the simplest setup will slow down and eventually create bottlenecks and jams. Organize and improve your inventory management so there is a well-defined flow for employees to take on their picking journey. A big difference is being made by retracing their steps especially when space is limited.
2. Visualize Product Movements
Your current setup may seem like it is working. But your current layout is likely masking a huge problem. Wasted motion in warehouses costs billions in productivity every year. In order to help you conduct the space assessment and optimize your warehousing, try literally mapping out the current flow. Which routes are being taken most often? Do they involve lots of long trips or out-of-the-way? Also, keep an eye out and make note of where things are going wrong. Is there a particularly overstuffed corner where people are getting caught up? Is there a reshelve tub that’s constantly parked in the wrong place? Are there areas where too many people are picking at once because of the popularity of the item? Knowing these issues with certainty witnessing them and taking notes. Can help you get to the root of your traffic problems and visualize how to begin fixing them.
3. Storage Cleaning and Upkeep
From a safety, efficiency, and financial standpoint, cleaning, and upkeep are absolutely critical parts of inventory organization. You should also be planning ahead to ensure your inventory space stays well-organized and tidy. Once everything is in place for optimal picking time and function, you must ensure things stay that way. Everything needs to have a designated area. Empty pallets, boxes, and other trash are being removed as soon as they are created. Clean-up and reset at every position and every shift or day have to become second nature. Perhaps use project management tools to ensure this clean-up process happens each day. Enforce a no-mess policy and you’ll be amazed at how big an impact it has on overall energy and flow.
4. Constantly Do Warehouse Audits
Is there any bigger headache than trying to work around inventory you just don’t need? It takes up space, it requires time and energy to try and figure out what to do with, and it ultimately means more work to finally get rid of it. Well, an ounce of prevention is worth a pound of cure, and the best thing to do with unneeded inventory is to avoid having it in the first place. By regularly evaluating low-turn, out-of-season, EOL inventory, you can create more accurate forecasts for what you need, and prevent the buildup in the future. And for any excess, you already have lying around? Have sales/marketing develop strategies to sell through, return, or liquidate.
5. Product Location
It really is everything. According to Supply Chain 24/7, “travel time can easily account for 50% or more of order picking hours” so it is imperative that travel time is reduced and picking strategies are in place so time is never wasted. This depends on location. From the location of the item within your space to the space itself, location plays a vital role in determining the efficiency of your picking. Make sure you understand your location, its drawbacks, and its strengths, and plan accordingly. And while all these tips might help make you make a better plan for achieving inventory organization, the biggest predictor of efficient picking is this: treat inventory process initiatives as mission critical for the company. Sure, many steps come before and after, but in the long run, good business depends on good picking.
This is a guest post by Laura Hudgens, a writer for TechnologyAdvice.com. She is a communications instructor and freelance writer who studies and writes about technology, media, science, and health.
Dimitris Athanasiadis oversees Operations and Customer Relations in Megaventory.
1 thought on “How To Improve Your Inventory Management”
Thanks for sharing such a great piece of information through the article. These tool used for organizing inventory data that before was generally stored in hard-copy. Inventory management software helps to reduce carrying costs and establish a desirable re-order point. This tools is used to track products, parts, and tools as they are transported between vendors, warehouses, customers, and companies internally.