How to calculate safety stock – with formulas and examples
To calculate safety stock, work out your average daily use for a product and multiply it by its average lead time – how long it takes, in days, to arrive once you place an order. Then subtract this number from your maximum daily use times your maximum lead time. The result is the safety stock […] ... Read More
November 27, 2020 accurate inventory, excess inventory, inventory management, inventory metrics, inventory reporting, safety stockUnderstanding What Is Inventory Management
As a component of supply chain management, inventory management oversees the flow of goods or components from manufacturing to warehouse, and ensuring goods are tracked and well stocked. This includes determining when to order products, in what quantities and from which supplier. Efficient inventory management ensures that your business will always ... Read More
November 23, 2017 accurate inventory, business growth, inventory management, supplier relationshipAccurate Inventory Costing: Why It’s Critical for Success
For most stock-based businesses, inventory is likely to be the business’ biggest asset. Even if a business has some other, high value, assets such as factory plant, inventory is likely to be essential to the business’ ability to trade profitably. Because inventory is so critical to a business’ success, it is useful for business owners [&helli ... Read More
July 4, 2017 accurate costs, accurate inventory, inventory accounting, inventory cost, production costConducting a Successful Stocktake
A stocktake is a record of the inventory a business has on hand, which is commonly done at the end of the year. However, some businesses may perform stocktakes more regularly. An accurate stocktake is essential for making informed business decisions relating to inventory management and control. A successful stocktake gives you valuable insight into ... Read More
July 1, 2017 accurate inventory, accurate stock counts, inventory management, inventory tips, stock take, stocktakeThe Benefits of the Just-In-Time Approach
In inventory management, the Just-In-Time or JIT system reduces wastage, improves efficiency and productivity, and contributes to smoother production flows. A shorter production cycle can decrease financial costs, inventory costs and labour costs. Below, we summarise the key features of the JIT approach. But first, check out our quick explainer on ... Read More
June 29, 2017 accurate inventory, inventory methodology, JIT, just-in-time, just-in-time methodology, manufacturing, production cost, supplier relationshipWhy Accurate Inventory Levels are Essential
Inventory is vital for any goods sector business; retailers and wholesalers rely on inventory for sales, while manufacturers need inventory to keep the production process running. Being able to accurately determine inventory levels is important – too little and your business can’t function; too much and your business risks being swamped ... Read More
June 28, 2017 accurate inventory, inventory cost, inventory levels, overstock, overstocking, sales performance, under stock, understockingAccurate Inventory Records are Crucial for Success
Without keeping an accurate record of your company’s inventory, you risk dissatisfying your customers and ultimately, losing profit. Below, we summarize precisely why keeping accurate inventory records is crucial for the success of your business. Be Prepared An accurate inventory record first and foremost means that you are more likely to be able ... Read More
June 5, 2017 accurate inventory, business forecasting, customer satisfaction, employee satisfaction, inventory records, overstock, under stock4 Reasons Why Accurate Inventory Is Critical For Success
Knowing your inventory is critical. Here are four reasons why access to up-to-date, accurate inventory will keep you trading and protect your bottom line. ... Read More
May 5, 2017 accurate data, accurate inventory, overstock, stock shrinkage, understockThe Benefits of Correct Inventory Levels
Maintaining accurate inventory levels is a crucial part of a business. Here are five benefits of having correct inventory levels. ... Read More
March 9, 2017 accurate inventory, customer service retention, inventory as capital, stock count, stock reorder