00:44
Faizan
So you are operating a wholesale business and you want to know best practices for effective stock control and stock management. Everyday people are starting new businesses, often they begin by selling through eBay and then due to sales growth open up a large warehouse. What people then realise is that success is not just about sales it is about effective stock control, margin management, order dispatch and customer management.
So what are some of the keys?
Stock control at its most basic levels requires the management of what stock you have and what stock you need. Now this sounds easy when you say it like that, however when you bring in lots of stock items/products, lots of orders, customers and staff, this simple task can become overwhelming. So what you need is an inventory system which involves both software and physical processes.
Let's start with stock ordering. Stock costs you money and while it sits on the shelf there is a finance cost, so you only want to hold what you need to match your sales volume, this is a key goal of effective stock management. To do this you need access to your current stock levels and also your sales history from previous months and your current sales orders. You use this information to predict sales volume for each stock item and then order stock levels to support this plus a percentage buffer. The level of this buffer needs to take in to account the time it takes from the placement of your purchase order to the receiving of your stock. If you can get stock quickly this buffer can be much small, if stock comes from overseas with a 6 week plus delivery you need bigger buffers. A good software system will provide reports and tools to assist you to make these decisions. Like any prediction based on historical data you will never get it absolutely perfect but it will ensure you minimise the cost of holding too much stock.
Stock control and the receiving of inventory. When the truck arrives it is important that you have systems to process the goods. The best practice is to receive your items in to a bulk location. In many warehouses they will paint lines to clearly show this area. Then you and your staff process the stock and check that what you ordered has been received and then move the stock to the bin or shelve location. Again this is where you need a system as in an inventory system that supports tracking the bin location for stock. Bin and shelf numbering is very simple to implement. Basically cut up your warehouse in to areas or eile and label them A, B C, D etc. Then in each area create and label shelf areas with a number so you have bin locations such as A1, A2, A3, C1, C2, C3.
So what are some of the keys?
Stock control at its most basic levels requires the management of what stock you have and what stock you need. Now this sounds easy when you say it like that, however when you bring in lots of stock items/products, lots of orders, customers and staff, this simple task can become overwhelming. So what you need is an inventory system which involves both software and physical processes.
Let's start with stock ordering. Stock costs you money and while it sits on the shelf there is a finance cost, so you only want to hold what you need to match your sales volume, this is a key goal of effective stock management. To do this you need access to your current stock levels and also your sales history from previous months and your current sales orders. You use this information to predict sales volume for each stock item and then order stock levels to support this plus a percentage buffer. The level of this buffer needs to take in to account the time it takes from the placement of your purchase order to the receiving of your stock. If you can get stock quickly this buffer can be much small, if stock comes from overseas with a 6 week plus delivery you need bigger buffers. A good software system will provide reports and tools to assist you to make these decisions. Like any prediction based on historical data you will never get it absolutely perfect but it will ensure you minimise the cost of holding too much stock.
Stock control and the receiving of inventory. When the truck arrives it is important that you have systems to process the goods. The best practice is to receive your items in to a bulk location. In many warehouses they will paint lines to clearly show this area. Then you and your staff process the stock and check that what you ordered has been received and then move the stock to the bin or shelve location. Again this is where you need a system as in an inventory system that supports tracking the bin location for stock. Bin and shelf numbering is very simple to implement. Basically cut up your warehouse in to areas or eile and label them A, B C, D etc. Then in each area create and label shelf areas with a number so you have bin locations such as A1, A2, A3, C1, C2, C3.
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