The demand for lightning-quick fulfillment, coupled with a myriad of small-order additions, has led to a complex operating environment. Shipping issues are the second-most widely reported reason for consumer dissatisfaction when shopping online—caused primarily by lost packages and/or late deliveries.
Any one of the various moving supply chain parts can be responsible for shipping delays. For instance, inventory discrepancies at warehouses might be the reason for a slow shipment. If a consumer places an online order for an item that actually isn't in stock (despite what the website says), the warehouse cannot fulfill the order in a timely manner.
By following a few basic warehouse inventory management best practices, you can streamline your order fulfillment process to successfully meet your key performance indicators (KPIs).
1. Use an Ongoing Cycle Count
In some cases, it’s better to keep track of your inventory on a rolling basis than to have a comprehensive system that needs to be regularly updated. A once a year Physical Inventory can be cumbersome from labor planning and execution. Keeping up to date within monthly or weekly cycle counts for specific SKUs will minimize the amount of time you spend tracking and collecting data and can keep your operations on point.
2. Do an ABC Analysis
An ABC analysis is categorizing and prioritizing your inventory based on what is most valuable. This way you can make sure to utilize your time and labor effectively to increase your returns. Without this analysis, you might be spending equal amounts of time and effort on items that are of unequal value.
3. Track Your Inventory
If you don’t know where all your products are at any given time, then you will waste time hunting it down later. An interconnected system will show you where your inventory is, when it needs to be moved, and when it has shipped.
4. Automate Your Data
When you track and move thousands of pieces at a time, there will inevitably be the occasional human error. If your staff is manually entering numbers into a system, one small error can have a huge impact. Even if you are technically automated on the back end, your data collection process needs to be automated as well to drastically decrease the probability for errors.
Using systems like RFID tags and scanners means you never have to worry about someone mis-entering in a product label or number. Plus, it will save you time as your staff will no longer have to do manual data entry.
5. Don't Hold Up The Line
Don't let short shipment holds bog down the entire warehouse. Late-arriving packages are often the result of inventory inaccuracies i.e. when the quantity of an item listed is less than the quantity received. Short-shipped orders can create an inventory freeze and affect the warehouse's ability to fulfill additional orders. Rather than freeze your warehouse's entire inventory, shippers can ensure fulfillment systems unlock held inventory in order to fulfill orders not associated with the SKU in question.
6. Normalize adjustment codes across inventory pools
As companies grow, they tend to use a variety of different warehouses in different geographic locations. As the number of inventory pools increases, managing inventory across those pools often becomes more complex. After a short-shipped order, for instance, if inventory adjustment codes at different warehouses are not all synced, it's difficult to know which held items to unfreeze.
Normalizing inventory codes across all your warehouses seems like an obvious answer, but it is a solution that many companies leave out of their maintenance routines. Normalizing codes provides a better idea of the items that are potentially available and helps forecast when an order can be fulfilled.
Streamlining your warehouse inventory process can have a huge impact on your business. You will not only have a clearer picture of what goes on inside your warehouses, but you’ll also be able to hit those KPIs and keep your customers happy.