In this article we will talk about:
- Controlling inventory is important and no one doubts, but ...
- How to Create and Maintain a Stock Control Discile
- 6 Tip - Have a tool
At the same time that everyone thinks that inventory control is really important to your companies, it is common to see a lack of general organization in relation to the lack of discipline to do this management on a day to day basis.
We have already talked about this in some posts as in the article by introduction to stock control or in the 3 Methodologies on Stock Control, but today my biggest goal is to show some tips that if followed can prevent you from having great damages related to your control of products or stored items.
The truth is that there is not much mystery to create and maintain a good discipline of inventory control. Let's see some tips that can be the difference between good control and total disorganization:
- 1 Tip - Hire an employee to track inventory
The account you need to make to know if an employee is needed is very simple. See the amount of waste or missed opportunities due to lack of inventory occurring over a month. If this number is higher than the salary (and usually is), it is worth having a person responsible for this function.
This employee will ensure that new orders are made whenever a stock item reaches its minimum stock, will watch for perishable goods (very common in supermarkets and pharmacies) and always have reports with information on the quantity in stock.
Obviously this tip will depend directly on the size of your company and your stock. If your business is very small it is very likely that this activity is your responsibility or that someone accumulates this function with others.
- 2 Tip - Ensure that person is trusted and has goals
It is not uncommon to hear instances of theft or inventory accidents. Usually this is due to the lack of control and incentives (good salary, bonus or recognition) of who is in that position.
To avoid this kind of situation it pays to have people recognized for honesty and involvement with the company. In addition, another very cool tactic is the positive incentive toward stock control goals, which are a good incentive for that person to take extra care of their stock.
By now you already have a person to take care of your inventory and she has goals for that, but you still lack a control routine.
- 3 Tip - Take inventory of your inventory
In order to reach this organization it is important to have a periodic control of the quantity of items in inventory, which have expired or have a safety stock below the desired level. All this will allow you to not lose money because of poor inventory management.
A very cool example of how inventory accounting can help managers, was with a former LUZ customer who owned a machine shop. Basically this workshop had a well organized process, a good amount of customers and a growing revenue. The problem reported by our client was that every end of the month was almost nothing, that is, the company was not profitable.
In a quick analysis we realized that it had more than 1 million in stock of products and equipment that were not even used in the day to day workshop.
- 4 Tip - Have periodic controls
Just doing this accounting once a year is not enough, so set up a periodicity of analysis based on the availability of staff and the size of inventory you have. With our inventory control sheet you can see your stock from month to month and make decisions from this review:
- 5 Tip - Have a way to organize your process
To close the discipline of inventory control with a golden key is very important to have a process of entry and exit of products or materials. It is precisely this organization in a practical and simple way that will allow you or the person in charge of the sector to always perform well and not forget anything.
A common error related to these processes is the entry or exit of products or materials from inventory without updating (lowing) in the system / spreadsheet. With this, it may appear that losses occurred when in fact everything is normalized or the opposite. With a responsible person this process becomes easier, but if it's just yourself, try to keep a good routine of controlling and organizing your inventory.
Everything I've said so far is essential, but if you're going to do that control on paper you'll end up going crazy or missing the records. So I recommend a good stock control sheet to avoid basic errors to the maximum.