THE INTRICACIES OF INVENTORY CONTROL
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
Managing inventory is complex, with items flowing in and out daily across various
locations like warehouses and production floors. There may even be obsolete or scrap
items mixed in. With potentially thousands of different parts numbered in various ways
and valued differently, control systems are needed to ensure accuracy of inventory
units and costs.
A good inventory control system should minimize the risk of losing inventory to issues
like theft or disasters. It should also ensure costs are applied fairly and consistently,
and that shipment of goods triggers appropriate customer billing. However, the system
should focus on mitigating the greatest risks without getting bogged down in lots of
non-value-added activities.
Overseeing Inventory on the Move
In-transit inventory, where ownership shifts between sender and receiver, requires
careful attention. Failing to properly record intercompany transfers on both sides can
cause unit and cost errors. Periodically auditing both sides of such transfers helps
detect issues later. Requiring customer signatures on bill-and-hold documents reduces
potential for revenue recognition abuse when goods aren't shipped but ownership
transfers.
Reviewing shipment terms ensures inventory gets recorded properly by sender or
receiver as required. The easiest approach is preventing in-transit ownership
altogether through company policy. If ownership does transfer during shipping,
insurance coverage should be verified to mitigate risks from damage. Enforcing rapid
monthly financial reporting curtails pressures for extended period-end cutoff that could
exclude in-transit items.
Strategic Stocking for Lean Inventories
Many inventory problems originate from initial decisions about safety stocks, product
options, and new component designs. Safety stock levels of seasonal items should be
revisited quarterly to avoid obsolete stock from demand drops. Reducing total
products and options cuts associated parts needing storage. Standardizing
components across products limits proliferation of similar but separately tracked items.
Engineering change orders should check remaining stock of obsolete parts to maximize
usage. Reorder flags for canceled components must get turned off so unneeded items
don't get replenished. Purchase orders should get checked against current needs to
cancel unneeded orders before items arrive. Even rewarding managers for reducing
working capital investment provides an incentive to control inventories.
