Inventory turnover is the ability to sell all the stock that a company has stored in its warehouse. If a company wants to improve its turnover rate, it is usually seen as a job for marketing and sales. Products must be in high demand and bought up quickly.
There are ways a warehouse can assist in turnover planning. The data generated by daily inventory operations is crucial to all product distribution strategies.
Does the company need a faster inventory turnover?
Company leaders have to decide why they want a faster turnover rate. Industrial Supply indicated there could be reasons a business likes to buy its stock on a yearly basis instead of small orders that are sold quickly. For example, suppliers may offer discounts when companies buy in bulk.
The cost of storing items for long periods may be the factor that determines faster inventory turnover is necessary. If the manpower, real estate, equipment and assets required to keep up emergency product supplies or old stock is too cost-prohibitive, then a company will want a strategy that emphasizes fast turnaround.
What warehouse insights are necessary?
Warehouses should provide accurate inventory levels. If a company is planning a product distribution procedure based solely on sales figures, it might miss items that were returned, damaged or stolen. Physical inventory counts are essential for creating a full picture of current operations for when businesses contemplate changes.
Mobile warehouse inventory management solutions offer employees the tools they need to create accurate reports of stockroom performance. Physical counts are much easier to perform on a routine basis when workers audit items using equipment like NAV barcoding devices that instantly send information to a centralized source. Dynamics NAV time collection modules provide ERP system users with insight into how much time and resources actually went into picking, storing and shipping.
Once managers calculate the number of hours and employees needed for long term storage, they can create new strategies for continued success.
How can a warehouse facilitate faster turnover?
The information provided by mobile solutions is essential in answering another question: Is the warehouse capable of handling faster turnover?
Efinance Management said companies that practice high turnover rates don't keep old inventory or safety stocks. The business will want a lean product level ready for instant customer demand. This means the entire supply and distribution chain should go faster. Employees can capture project performance on Dynamics NAV time collection devices. Information from old operations can show if there are any redundancies in the current system and if there are ways to increase the speed and efficiency of daily practices.
In a fast turnover system, warehouse workers operate without a net. Employees should put away products, pick orders and ship goods without making any mistakes. If workers send an order to the wrong location or damage merchandise, there is no safety stock to replace it. Warehouse managers need tools that can improve accuracy and facilitate optimum performance.
Companies weighing the possibility of increasing inventory turnover rates can download the Time Collection Dynamics Data Sheet to see how mobile tools can help with new strategies.