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Inventory Accuracy

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  • #33228

    McNabb
    Participant

    I am working on project in a manufacturing company that is focusing on ensuring proper inventory accuracy. One of the main challenges occurs when items are returned to inventory after a part of the inventory is used to assemble the finished product. Return counts are inaccurate which leads to either buying more of the item unnecessarily, or running out of an item during an assembly run since the system says there is more of the item available than there is.  2 cost savings that could be measured are       1. Reduction in buying items unnecessarily – hard to measure since we’re not sure how often this happens in a very large warehouse. and 2. costs associated with setting up to assemble a product and running out of an item and having to start over.  Does anyone have any suggestions about how to capture hard savings in an inventory accuracy project?

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    #90002

    Stephen O’Toole
    Member

    Mary
    Sounds like one of my issues. I am trying to embark on a similar project where inventory is poor. The only $HARD I would suggest is the cost of capital released through inventory reduction. Say you release $100k, then the saving is only some 5% (or so) of that. There are of course the unnecessary expediting costs, and it many be possible to get this data from purchasing.
    I am new to this BB stuff and don’t have a lot to go on as yet.
    I don’t mind keeping in touch since we are on a similar vein. E-mail me if you want [email protected], in UK
     

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    #90637

    Enzo
    Participant

    Hi Mary , I have just embarked on my Inventory Accuracy Project. I have setup a few meetings next week to discuss how to capture hard dollar savings. If you still need some ideas , email , perhaps we can compare notes.
    Enzo

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    #188504

    Lala
    Member

    Hi Enzo,
    Hard Savings due to Inventory Accuracy
    -> Working Capital Costs (Interest Charges) & Storage Charges saved due to reducing excesses (Positive Variances in Stock Count)
    Hope that helps.
    Warm Regards,
    Sunil
     
     

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