Supply chain manufacturing and logistics warehouse operators with an early-adopter mindset will soon be deploying a new technology that looks set to transform the all-important discipline of inventory management. It allows companies to live-count their stock as a day-to-day process rather than pausing production or order fulfilment for hours (or sometimes, days) to do so. Historically users have run time- and staff-consuming, disruptive and above all costly inventory counts that halt vital warehouse processes to provide a snapshot view of inventory that is then almost immediately out of date.
This less-than-accurate picture of the warehouse is a restricted view of operations and assets and also limits a company’s ability to respond optimally to its customers’ demands. In addition to out of date inventory information, missing or damaged stock is also a common problem.
The need to call a halt to operations simply to count inventory is caused by the limitations of enterprise resource planning (ERP) systems that in effect do not allow operations to continue while stock is being counted.
Now, a new breed of independent cycle count software has been developed that collects inventory information from warehouse data capture devices including scanners and mobile computers and posts it to the ERP, while allowing operations to continue. The software typically runs on an existing browser so is quick to install, either standalone or integrated with an ERP system. It also uses rules that allow it to be customized in line with the user organizations’ own namings and preferred work processes, making it easier to deploy, with minimal training.
Importantly the live-count, real-time view of inventory that new-generation software such as TouchPath’s ‘TouchCount’ system delivers ensures that warehouse managers have an always-accurate view of the stock for which they are responsible. Product damage and loss is minimized and stock levels can be maintained at exactly the level needed for optimal fulfilment.
In short, technology is about to set a new standard in inventory management: a new best practice benchmark.
7 BENEFITS OF DAY-TO-DAY INVENTORY CYCLE COUNTING
New technology now makes it possible to record inventory as part of a company’s ongoing day-to-day, year-round operations. What are the benefits? Here we list the top 7, including ROI.
1. Less interruption to business
Picks, orders and putaways are no longer interrupted by full-scale inventory audits, saving on personnel costs and avoiding warehouse downtime while allowing counts for specific areas of the warehouse.
2. Greater customer satisfaction
Cycle counting maintains ongoing awareness of inventory levels in real time, meaning that low or missing stock can be replenished and customer orders can be shipped more rapidly. Stock is always ready and always in good condition.
3. Better business insights
Inventory counting generates reports on how product flows through the warehouse, enabling better decision making on product re-ordering and reduction.
4. Improved operational efficiency
Maintaining inventory accuracy 24 x 365 means fewer exceptions to handle and less time spent searching for misplaced products. Surprise losses of product through theft, damage or expiration are avoided.
5. Item counting flexibility
Cycle counts can be set up in line with business need, with the freedom to decide what items are counted, and when.
6. The cycle count as an ongoing, day-to-day activity
Thanks to new technology inventory cycle counting no longer disrupts order fulfilment, so it can become part of day-to-day operations, delivering the benefit of consistently accurate inventory counts that annual or semi-annual counts cannot.
7. IMPACT: cycle count technology ROI
TouchPath’s own industry experience suggests that ongoing, year-round inventory counting technology pays for itself within the first year in downtime reduction, slashed overtime costs and low-to-no product losses: savings that continue into Year Two and beyond.