14 February 2023 Discover if your warehouse is making the main errors in counting and monitoring inventory stock. Inventory management is one of the main activities for warehouses of any size and market segment. Although for some companies it may seem a time-consuming, methodical, and tedious task, it is through this practice that effective management and control of the inflow and outflow of stock items are guaranteed, providing the warehouse with greater security, accuracy, confidence, predictability, and better logistical performance for the entire workflow. Good inventory management and monitoring translate into great benefits for the company. With consistency and effectiveness in the process, it is possible to obtain a series of benefits that concern, for example: – Reduction of losses: an efficient warehouse inventory allows for the precise identification of existing items in stock, reducing unnecessary expenses for purchasing new items, avoiding waste, and preventing losses of products that might remain on the shelves for a long time. Additionally, it is possible to resolve bottlenecks such as the discrepancy between inventory and accounting information, making it easier to identify if theft or loss of goods has occurred. – Predictability: it is possible to observe periods of higher demand for certain products and understand the behavior of your company’s customers. Monitoring this event allows you to always stock up according to market needs, facilitating the work of managers who can avoid extra purchases that do not represent the seasonality of the stock. – Better customer service: through the visibility of items in stock and the logistics of inflow and outflow, as well as seasonal periods, it is possible to improve sales, identify growth opportunities in the market, and offer greater confidence to customers. Lack of inventory control can cause problems in customer relations, especially when selling unavailable products. – Compliance with regulations: there are many regulations on stock management carried out in companies, from those working to extract raw materials to retailers. Therefore, keeping the inventory in order also ensures that the warehouse avoids accounting inconsistencies and inspection issues. There are many positive consequences that inventory control offers to warehouses. However, there are also several challenges to performing this activity efficiently and optimally. We have observed, over years of experience, that many companies face enormous problems in terms of stock accuracy, i.e., errors in the quality and truthfulness of the information contained in control systems compared to the physical existence of items. In general, this stock discrepancy, which corresponds to poor accuracy, can occur due to a series of errors during the inventory control flow, such as in reception, registration, and/or some physical movement that was not correctly executed in the system. By understanding where such conflicts occur, we will indicate the main errors that may occur in your warehouse today. Let’s find out if your company is prone to errors in warehouse stock? Check out the topic below! Common Errors During Inventory Error 1: Failure to Perform Cycle Counting If your company still needs to periodically stop operations to conduct inventory, know that this is not always the best logistics for a warehouse. After all, dedicating hours – or even days – to performing this activity can cause financial losses to your business. In this scenario, the cycle inventory methodology was developed to ensure periodic counting of product groups, instead of conducting a single annual inventory and without interrupting your company’s operating hours. Cycle inventory counting is one of the main methods to ensure accuracy, especially for retailers. Conducted daily or weekly, it presents a series of advantages that optimize your internal processes, such as: – Accurate stock recording: since the counting is done more frequently, it is possible to identify items in stock and quickly recognize any errors. When using an inventory management system, like WMS, this counting can be monitored in real-time. Additionally, the software offers a great advantage, which is automatic notification in case of discrepancies. This way, they can be corrected promptly. – Organization of item counting: since it is done based on categories, it is possible to determine an order of counting, such as a turnover index (A, B, C), addresses, among other criteria. – Quick error identification: was a product missing? Were there losses or damages? All this is easily detectable when counting is done cyclically. Once a problem is detected in the warehouse, it is quicker to resolve it and seek solutions efficiently. – Maintaining productivity: with this methodology, there is no need to interrupt the company’s activities, so no business opportunities are lost. – Making assertive decisions: since the inventory activity is closely monitored, managers have greater security in processes and logistical strategies, such as purchasing new items, storage, and order preparation. Error 2: Not Training Your Team Conducting a stock count may seem like an easy task, but it is essential to have the right people to perform the function. Inventory is the “heart” of your warehouse, so ensuring your team is skilled and capable of providing insights for improvements and identifying opportunities is key to success. The more specialized and experienced your employees are in this role, the faster the activity will be performed, allowing you to optimize time and resources, reduce errors, and prevent important details from being overlooked. Does your company lack experienced employees? Invest in team training and empower them. Another possibility to promote greater efficiency in monitoring warehouse stock is to use management software or hire outsourced warehouse counters. Error 3: Not Planning the Counting in Advance Planning is the action word that makes the difference in a company’s success. From the smallest details to the largest activities within your warehouse, the ideal is for everything to be strategically thought out and planned in advance. Do you have questions about how to execute good inventory planning? Start with these steps: – Plan the process structure: define the time needed to conduct the stock count, determine the team and employees who will perform the activity, identify the counting frequency: daily? weekly? monthly? Remember that the shorter the time between counts, the greater the stock accuracy. – Communicate with your team: after planning, ensure that all parties involved in the process are informed in advance. Share dates, times, execution periods, desirable goals for each count, and ways to optimize the process. Error 4: Not Mapping Your Warehouse It may seem simple, but mapping your warehouse is one of the fundamental methodologies to ensure good inventory management. This is because it facilitates the visibility of locations where products are stored, addresses, aisles, shelves, sizes, and every particularity of each place. A well-structured map helps organize the counting, allowing you to trace the best route to perform the work, reducing physical effort, optimizing time, and the energy of your team. In addition to mapping the physical space, it is essential to clearly identify products and addresses, allowing for quick identification. Error 5: Counting Manually and with Paper The days when companies used manual methods, paper, and pen to record all processes and flows existing in a warehouse are over. Times have changed, but despite the wide variety of mechanical tools, machines, and systems capable of optimizing activities, some companies insist on maintaining stock counts and inventory control manually. This is a serious error, requiring double the work hours, not to mention the increased error rate and the possibilities of a low level of accuracy. In this case, the ideal is to invest in an inventory management system, like WMS, which has the capability not only to automate inventory counts but also to offer real-time updates. With highly capable and customized software based on your needs and requirements, it is possible to monitor what arrives and leaves your warehouse, conduct cycle counts assertively, track products, record information, monitor orders and purchase flows, as well as provide macro visibility and identify problems during the process, all without interrupting the operation of activities. When you use a WMS integrated with data collectors, you gain agility and accuracy, and your employees have powerful allies to achieve the expected productivity. Keep Your Warehouse Inventory Under Control in Real-Time It is a common opinion in the market that leading companies today use cutting-edge technologies to their advantage, aiming to increase their performance, gain more space among competitors, and constantly optimize the customer experience with their products and services. In addition to investing in innovations, these companies also evaluate and reevaluate daily the internal processes that directly affect their market positioning. Therefore, to become a model company and have a warehouse capable of meeting high demands and achieving greater profitability, it is necessary to look at the small errors made today in inventory. One way to implement a series of improvements in your warehouse is to invest in a good management system, a tool capable of helping optimize processes and improve management, providing gains in productivity, security, as well as reducing errors and costs. This is exactly what WMS does for your warehouse. With Visual Management, the WMS coordinates activities and allows managers to have real-time access to information from the entire operational process, enabling timely identification of failures to prevent them, as well as making the right decisions for business growth. In accordance with its objectives, the system presents features that guarantee gains in all warehouse processes, from receipt to shipment and even during inventory execution, ensuring maximum accuracy. Therefore, if you want to transform your current scenario, consider implementing a WMS in your business. Results of Efficient Inventory Management By conducting proper inventory management in your warehouse, performing cycle counts, ensuring planning, guidance, and training for your team, automating processes, and optimizing time, your company will increase accuracy rates and have the direct result of reducing financial losses, reducing items parked in the warehouse, reducing costs caused by the interruption of activities during product counting, ensuring punctuality in deliveries and products for consumers, reducing safety stock and extra purchases. Therefore, do not leave corrections and adjustments for tomorrow. Start today! The results will surely repay all your efforts! Inventory: Where You Might Go Wrong Deagor WMS per ecommerce può aiutarti!