Inventory accuracy is a common concern among my clients. Here are some tips to help improve the accuracy of the inventory within your facility:
1) Training training training. One of the single biggest causes of errors in inventory is the use of resources who aren’t properly trained, or folks not following proper procedures when performing actions that affect stock quantities. Of all the training areas, unit of measure is one of the most important. Many errors related to inventory occur due to counting or selecting the wrong number of units. The best way to avoid this is to make sure your people are able to distinguish a case, an inner pack, and various other units and know which one they should be working with.
2) Don’t overfill locations. Product can spill out of a location or get mixed up with inventory in an adjacent location. The best way to avoid this is to make sure that you don’t overfill your primary locations, and use containers or totes to keep inventory from getting mixed up. Proper labeling and the marking of slots with tape can also help.
3) Deploy a cycle counting program. If you want your inventory to be accurate for more than one month out of the year, consider a cycle counting program that “cycles” through your inventory in a predetermined sequence. You can select how often to cycle through selected areas based on your desired accuracy level.
4) Research recurring errors to determine the causes. If the same errors are occurring again and again, take some time to research why they are happening, and then fix a physical cause or provide training for human errors.
5) Count problem areas more often. Keep track of where errors occur. If a particular area or group of items causes most of your errors, try to count and review these areas with greater frequency than areas that have low error rates.
6) Improve paperwork and location labels. Make sure that your paperwork and location labels are easy to read. Replace worn or damaged labels. Make the locations and quantities on your paperwork stand out with large bold characters.
7) Have suppliers or internal staff bag large-quantity small items in groups. By grouping items into appropriately sized “packs” you can speed picking and also counting of a location. Packs can be split open, but this idea works best if customers choose a full=pack quantity most of the time.
8) Use barcode or voice verification of moves. Barcode or voice systems can confirm moves with a very high degree of accuracy and prevent a worker from placing an item into (or picking from) the wrong location. Such systems are often provided as part of location management systems and warehouse management systems.
9) Require high levels of performance. Track the performance of your staff, and require minimum performance standards. Keeping track of errors will encourage your staff to operate at a higher level of performance.
Sam Flanders is president of Durham, NH-based Warehouse Management Consultants (www.2wmc.com).