How do you track inventory in manufacturing?

1 What is inventory tracking?

Inventory tracking is the process of monitoring and recording the quantity, location, and status of your raw materials, work-in-progress, and finished goods. By doing so, you can gain a better understanding of what you have, where it is, and how much it is worth at any given time. This can help you improve your efficiency, quality, and profitability by reducing waste and excess inventory, preventing stockouts and overstocking, enhancing customer service and satisfaction, streamlining purchasing and replenishment, improving forecasting and planning, and complying with regulations and standards.

2 How to choose an inventory tracking method?

When tracking inventory in manufacturing, there are a variety of methods and systems to choose from based on your needs, budget, and preferences. Manual tracking is the most common option as it is low-cost and easy to implement. However, it is prone to human errors, delays, and inaccuracies. Barcode scanning is another popular choice as it is fast, accurate, and reliable. However, it requires some upfront investment in hardware and software. Finally, RFID tagging is the most advanced option as it allows for wireless tracking in real time. It is also more flexible and secure than barcode scanning; however, it is more expensive and complex to set up and maintain.

3 How to implement inventory tracking in manufacturing?

Once you have chosen an inventory tracking method, you need to implement it in your manufacturing operations. To do this, you need to define your inventory categories and units, label your inventory items and locations, set up your inventory system and software, and train your staff and test your system. Specifically, you must classify your inventory into raw materials, work-in-progress, and finished goods, assign them appropriate units of measurement, attach barcode or RFID labels to them with unique identifiers such as serial numbers or SKUs, label your inventory locations, map them in your system, configure your inventory system and software according to business rules such as reorder points or safety stock levels, integrate it with other systems like accounting or production, train staff on how to use it and follow procedures and policies, and test it for functionality, accuracy, and reliability.

4 How to optimize inventory tracking in manufacturing?

After implementing inventory tracking in manufacturing, you need to optimize it to ensure that it meets your goals and expectations. To do this, you should monitor and analyze your inventory data regularly, such as inventory levels, turnover, accuracy, or shrinkage. Compare the data with your key performance indicators (KPIs) and evaluate your performance. Adjust and improve your inventory processes based on the data and performance, including revising inventory policies or implementing inventory techniques like just-in-time (JIT), lean, or kanban. Additionally, update and upgrade your inventory system and software to keep up with the changes and demands of your business and industry. This may involve adding new features or functions, or switching to a more advanced or customized solution.

5 How to overcome inventory tracking challenges in manufacturing?

Despite the benefits of inventory tracking in manufacturing, you may also face some challenges, such as data entry errors, inventory theft or damage, and inventory obsolescence. To overcome these challenges, you need to implement some best practices, such as quality control and verification procedures to ensure that your inventory data is accurate and consistent, security and protection measures to prevent or minimize inventory theft or damage, and inventory management and optimization techniques to avoid or reduce inventory obsolescence. You can use methods such as physical counts, audits, locks, alarms, cameras, insurance, demand forecasting, product life cycle analysis, or inventory turnover analysis to check and correct your inventory data, secure and protect your inventory items and locations, and manage and optimize your inventory levels and mix.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?