In this episode, we discuss how to improve inventory record accuracy, which can have a massively positive impact on the speed of the close. However, the improving inventory record accuracy is a prolonged process that will undoubtedly take months, and consume the time of the best warehouse workers. Key points discussed are:
Install inventory tracking software that records inventory locations.
Create unique rack locations in the warehouse.
Number the racks, as well as the bins within the racks.
Lock down the warehouse with fencing.
Consolidate parts into a single location, or as few locations as possible.
Assign part numbers to all inventory items.
Verify the unit of measure for every inventory item.
Part the parts into boxes or bags, and record the amount on each box or bag (facilitates counting).
Count everything and enter it into the tracking software, including inventory locations.
Conduct an ongoing series of cycle counts and review the reasons for any errors found.
Do spot counts, calculate inventory accuracy, and post the results in the warehouse.
Pay cash bonuses to the warehouse staff for high levels of inventory accuracy.