Your Inventory Process

Almost every business has warehousing. Not all warehousing is what we typically think of; an actual warehouse with industrial shelving and a robust system and software to back it. It’s common for small and medium sized businesses to operate out of sheds, garages, self-storage facilities, shared workspace, and so on.

It is also common for those same businesses to keep these setups as they grow. This is one of the leading pain points that I have seen while working with multimillion-dollar companies. They’re losing on inventory and cannot figure out where it has gone missing or how it went missing. Where is their inventory going?

I bring this up because the problem is often simpler than we make it out to be. Like bridges, inventory systems can only support so much. That’s why we regularly, although annoying, experience bridges being updated or even decommissioned in favor of newer and better bridges. Those updates support more traffic, and so too should inventory systems as a business grows.

So, what do we do? How do we know when it truly is time to upgrade or replace an inventory system? There are a few signs you can look for, if your shrink reports are not already screaming at you of course.

Signs to Look For

• Picking time is way up
• Selling stuff that you do not have or cannot find
• Looking up an item is flipping through a notebook
• You don’t know how much inventory you actually need
• Much of the system isn’t documented and lives in one person’s noggin
• Long lead times ( minor chance this is outside of your control )

There are more signs, I’m sure of that. You can almost certainly think of some on your own, and if you can’t don’t worry you’ll know. Nothing hurts more than stalling the growth of your business because you can’t fulfill orders quick enough.

All of the signs, at least the ones listed, can stem from a handful of underlying problems. Not having a set location for specific items to be warehoused at will create a world of problems: picking times creeping up, longer lead times ( part of the problem ). Some businesses may already have modern software in place, but that doesn’t mean their inventory processes are modern.

And when inventory accuracy relies on notebook entries making it into a point-of-sale system we’re going to have major problems, eventually if not now. Then Jimmy leaves out of frustration over never getting promoted because he’s “too valuable to production.” Now you’ve got another problem. Write this down and give Jimmy that promotion he deserves!

So, let’s solve it. Let’s solve the problem. If only it were that easy, right? The solution must start by observation and acknowledgement. We must spend time in the shoes of those we aim to help. To truly craft a durable solution, you must understand the problem. The problem at a very high level is simply: “Numbers don’t match.” What happens at the lowest level? We must find out.

The answer is not always better software or more bespoke software. Software only works when it’s used as intended, in conjunction with a durable process. If you’re the owner of a business you may have become blind to the process or familiar with the smell. Bring someone fresh in to observe, or take some time away ( if you can ). Come back with fresh eyes, you’ll see the chipped flooring and sins you were committing. Only then can you start working on a solution that works for your business, even if it is bringing someone in to help develop a system and choose a better software solution.

Need a fresh set of eyes on something? Don’t hesitate to reach out.