Inventory management refers to the set of practices that enable an organisation to differentiate between enough and excess inventory and implement the same to improve its operational efficiency. Here are some 12 rules which will be of assistance in effective inventory management.
SKU (pronounced as skew) is the abbreviation of Stock Keeping Unit. SKU helps us to uniquely identify a product. Each organisation have their own SKU nomenclature policy, which refers to the methodology of numbering SKUs, governance and control. A given SKU number provides the same understanding to all the stakeholders not only inside your organisation, but also to your suppliers, customers and other stakeholders.
Cycle counting is the better alternative to periodic inventory counting. In cycle counting few SKUs are counted everyday by the Cycle Counters, who are trained in cycle counting. The accuracy of the logical inventory is much better compared to periodic inventory auditing as the inventory is counted continuously and more frequently based on the ABC Classification Criteria. Here I would like to recommend few best practices in cycle counting.
The primary purpose is to standardise, document and communicate the 6Qs or 6 Questions of all the activities or tasks involved in a process. The 6Qs are what, why and how of doing an activity and by whom, when and where.
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One of the biggest values delivered by the eCommerce companies is the last-mile connectivity. The term last-mile connectivity refers to the movement of products from a fulfilment centre or delivery hub to the end consumer. Last-mile connectivity established by the eCommerce companies introduced a lot of convenience to the customer, but at the same time posed many challenges.
Not very long ago, in the early 90’s, I was working for a large engineering firm in Chennai. I played multiple hats such as Layout Designer, Coordination with PPC and Inventory Management. Once in a year, that is during the first week of April the whole factory comes to a halt for couple of days. It is not that we didn’t had orders, but it was for inventory counting.
Predictive shipment refers to shipping products to your customers even before they have placed the order to you. I would say even the customers have not realised the need for the product or made any purchase decision. This is made possible with the advancement in the business analytics.
IISCM has launched a program titled “Leaders Talk” to help dissemination of supply chain knowledge and expertise within the the community. You can share your professional experience, industry insights, career guidance, trends, standards, challenges, lessons learned and understanding of a concept pertaining to supply chain and allied fields in the form of an article.
Enterprise Inventory Policy (EIP) defines both the aggregate-level and the item-level inventory management. Each and every organisation that deals with inventory must have EIP and it shall be reviewed on an annual basis. EIP is a policy document that shall be agreed upon mainly between the CFO and COO as well as by leaders of New Product Development, Marketing, Sales, Procurement etc. This provides a framework within which all the above leaders are expected to operate and ensure best
Inventory auditing is the process of reconciliation between the quantities of physical inventory and the quantities of logical inventory. Here physical inventory refers to the inventory we have on-hand, hence also known as on-hand inventory. And logical inventory refers to the inventory we have on the books or in your ERP or in your system.
Certified Supply Chain Certification Program popularly known as CSCP from APICS, USA aids an individual to prepare and showcase ones knowledge and skills in the supply chain operations of an organization.
Register for Complimentary Demo SessionCertified in Logistics, Transportation and Distribution (CLTD) certifications aims at providing in depth know-how to become a recognized authority in the fields of logistics management, transportation & distribution.
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Certified in Production and Inventory Management (CPIM) credential from APICS, USA is considered to be the gold standard in the area of production & inventory management and control.
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