How to Keep an Accurate Inventory in a Distribution Center

Organizing inventory can allow you to keep track of business progress.

The benefits of inventory accuracy include prioritizing purchasing, keeping track of what sells versus what doesn't, balancing financial books at the end of every business quarter and reducing operating costs by avoiding having to recount unorganized inventory. Certain steps can be taken to keep an accurate inventory in your distribution center.

Instructions

1. Log inventory as soon as it arrives at your distribution center. Most product orders usually come with an inventory slip or other list of products included in the shipment. Assign the responsibility of checking the contents of all incoming boxes against the product orders to one of your employees. Any discrepancies between the received products and what was ordered should be noted in a paper inventory journal or in a digital spreadsheet. Once your employee has double-checked the inventory in any incoming boxes, require him to reseal the box and mark the name and style of the product on the side of the package.

2. Organize inventory in your distribution center as soon as it is accurately logged in. Label specific areas and shelves of your distribution center according to how you want to organize your goods. For example, if you are a shoe retailer, categorize different areas of your distribution center floor by shoe type such as athletic, casual and dressy. Within each category, further categorize your shelves by male or female shoes, brand name and size. By organizing inventory in this manner, you can keep better track of which areas need to be restocked soon or which you products you have an overflow of.

3. Document your inventory levels at the end of a specific period of time to update your company's progress. This period of time may depend on your business cycle but could include weekly, monthly or quarterly documentations on inventory levels. Documenting inventory will allow you to accurately see what is selling more and what is selling less, and can indicate to you what the market wants from your company. Walk up and down the aisles of your distribution center to assess your inventory supply and make notes as you go. These notes may include noting products that don't seem to be selling and products that are sold out.

References

• Technology Evaluation Centers: 10 Tips for Perfect (Nearly!) Inventory Accuracy
• Material Handling and Logistics: Improve Inventory Data Accuracy
• Multichannel Merchant: Accurate Inventory Maintenance: Tactics That Work
• The Big Book of Marketing: Anthony G. Bennett