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Keeping a good account of where inventory items are located and how many are in stock is one of the most basic components of running a successful manufacturing/distribution business and it also proves to be the most challenging. No matter how good your  software is at tracking inventory, it can’t and won’t help you if you don’t have a thorough foundation outside of the software. That means that every item is accurately accounted for, labeled, and organized in its proper location.

In this article we will be addressing the foundations of effective inventory control. If these items sound repetitive, it’s only because they can’t be stressed enough and many businesses still struggle to maintain them.

Inventory Control

A lot of things go into effectively tracking inventory, but we will be focusing on these key areas:

  • Well organized warehouse/storage system
  • Detailed labels, with rememberable codes
  • An up-to-date inventory count
  • Training that supports and facilitates productivity

An up-to-date inventory count

Before doing anything else, it is vital that an accurate, up-to-date count of all of inventory be kept. It's necessary to do this first because it will prove to be impossible to track items that haven't been accounted for. When keeping these records it's also a good idea to include the unit of measure along with the numeric amount. For example, you'll want it to be formatted something like: "TT=2000 batteries, 200 boxes of 10". This helps workers put the quantity of the available materials into perspective.  So if, for instance, you want to use 50 of the 2000 batteries they'll know right off the bat that they just need to grab 5 boxes.


Well-organized warehouse/inventory storages

“A place for everything and everything in its place” is not just a saying for manufacturers, it’s the way they must operate their business. Keeping inventory organized is probably the hardest to maintain and yet it's the most critical. It’s significant because its success depends on how well everything else on this list is executed. Having a well-organized inventory space starts with naming all potential storage areas and deciding where each part or material will go in those areas. It is important that each item is put into locations that make sense. For example, don't store electrical pieces next to water-based materials. You will also want to put all the items that make up each product in a close proximity of each other.


Detailed labels with rememberable codes

It's important that labels on storage locations and products are as clear and detailed as possible. That way it's harder to get confused about what goes where, so time isn't wasted on trying to differentiate between items or aisles. You'll also want the assigned codes on the labels to be rememberable, not for the purpose of actually being remembered, but rather as a guideline to ensure they are short and not completely mystifying. Labels should always be easy to read and unmistakable.


Training that supports and facilitates productivity

The people who work with your stock and use your inventory system are the most critical element in establishing a pretty good inventory management system. You must make sure that these people know what to do with items that are received, taken from stock, reserved for future use, and required for production. They should also know who is responsible for making certain transactions, etc. In some cases, this may be only one or two people, but there’s nothing wrong with writing down your policies and making sure they get followed. If you or the people you work with aren’t consistent about the way inventory is handled, it won’t matter what software you use; you will only experience frustration and failure.

The next step to effectively tracking inventory is having the right software. Clients First provides customers with Acumatica and Dynamics AX, which are all-in-one solutions that can handle inventory control and much more. Give us a call at 800-331-8382 or email to learn more.

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