Inventory management is a crucial component of a well-functioning warehouse. Proper inventory management helps to optimise warehouse operations, increase productivity, and ultimately drive profitability. This article will discuss some of the best practices for managing inventory in a warehouse.
Use a Warehouse Management System (WMS)
A warehouse management system (WMS) is a software application that helps manage and track inventory, orders, and shipments. Implementing a WMS can significantly improve warehouse operations, as it streamlines and automates many tasks that have previously been done manually. A WMS can help with tasks such as receiving, put-away, picking, packing, and shipping.
Optima WS is a cloud-based WMS solution that provides real-time visibility of inventory and enables warehouse managers to manage inventory levels, allocate space, and streamline workflows. It also helps to improve accuracy and reduce errors by automating data entry, barcode scanning and inventory tracking.
Conduct regular audits
Regular inventory audits, also known as stocktakes, are essential to ensure the accuracy of inventory levels and prevent losses due to theft, damage, or misplacement. Audits should be conducted on a regular basis, and any discrepancies should be investigated immediately. Stocktakes can be conducted manually or using an automated system such as a barcode scanner.
As well as auditing your stock levels, you can audit your KPIs – this helps you monitor performance in specific areas over set time periods. The KPIs used at your warehouse will be unique to your business but may include inventory carrying costs, rate of turnover, fill rate, write-off rate or order cycle time.
Implement effective labelling and tracking systems
Labelling and tracking systems are critical to ensure the accuracy of inventory levels and enable easy location of products in the warehouse. Barcoding, RFID, and GPS are some of the technologies that can be used for labelling and tracking inventory. Effective labelling and tracking systems help to minimize errors and reduce the time required to locate products in the warehouse.
Optimise warehouse layout and storage
The layout of the warehouse and the storage methods used can have a significant impact on inventory management. An optimised layout and storage strategy can help to reduce the time and effort required for put-away, picking, and shipping. Improving the layout and storage of your warehouse helps improve your put-away and picking processes, whether you put-away based on the purchase order, SKU or product type, and pick using discrete order picking, batch picking, wave picking or zone picking.
An effective storage strategy should be based on factors such as product size, weight, and demand. It should also consider the availability of space, accessibility, and safety.
Train staff on proper inventory management procedures
Proper training of warehouse staff on inventory management procedures is critical to ensure the success of inventory management efforts. Staff should be trained on receiving, put-away, picking, packing, and shipping procedures. They should also be trained in the use of inventory management software, labelling, and tracking systems.
Inventory management may take a number of forms, one of which is ABC analysis, a ranking system that groups products. These groups are: A) best-selling, high-priority stock with requires regular reordering and quality control, B) valuable stock that requires frequent reordering and C) low-priority stock that needs minimal reordering.
How can Optima help?
Proper inventory management is essential to optimise warehouse operations and drive profitability. A WMS such as Optima WS is designed to improve inventory management in warehouses in a multitude of ways, increasing the efficiency in warehouses and boosting both profit and customer satisfaction.
Get in touch today to see how Optima can help your business.