Inventory management is important when it comes to perishable goods. From providing a quick overview of the location of stock to throwing up warnings for impending critical distribution and sell or use-by dates, an effectively managed inventory is often a must for businesses that deal with products that have a finite lifespan. For businesses that are looking to improve their inventory management systems, or even set a new one from scratch, it can be difficult when it comes to deciding on the type of management system to go for. The following solutions should help organisations to manage their perishable goods in a way that both promotes efficiency and saves money.
Deploy a FIFO Strategy
First In, First Out, or FIFO, is a simple technique that focuses on stock rotation. By ensuring that the older stock (first in) is sold or distributed first (first out), the stock is naturally sorted by date, thus preventing waste and spoilage. Managing FIFO can be as simple as a date management table on a piece of paper next to the storage area, or as advanced as an electronic data management system that indicates which stock is next in line to leave storage.
Set par levels
Knowing how much stock you need at any one time can be like trying to predict lottery numbers, but good forecasting is the key to minimising waste. Setting a par level can be a method that helps with forecasting; it refers to the amount of perishable stock required on hand at any one time based on sales records. If you are close to being out of stock, then you only need to order back to the set par level, and if you have plenty of stock left, then a light order or no order at all will help prevent overstocking.
Tying in with forecasting, contingency planning refers to the practice of expecting the worst (and best) case scenarios. For example, meat product sales tend to spike on sunny weekends thanks to the increase in people who would have a barbecue when the sun is out. By having a robust strategy in place, it will enable you to react faster and draw up or offload stock quicker to prevent making a loss.
Whether you are working with raw ingredients and perishable goods with a short or long lifespan, having regular inventory audits will only help track expiry dates. Audits can be laborious, time-consuming and expensive if you do not have the right tools and strategies in place. But done correctly using a system such as ERP, it can provide the most accurate picture of perishable stock items, the expiry dates and a snapshot of how effective your current stock strategies really are.
Use an Enterprise Resource Planning system
ERP systems are an efficient and cost-effective way of managing perishable inventory because it helps you catalogue, arranges and tracks stock. Modern ERP solution often has a range of functionality and can be configured to meet specific process requirements. By choosing to have a multi-purpose business system and not just a stock management system, it will help consolidate existing systems and improve productivity and efficiency throughout.
WinMan ERP Software is feature-rich and integrated, making it extremely handy for businesses that deal with perishable goods thanks to its scalability, streamlined interface and installation. Contact us today for more information.