ERP Pain Point #32: A large portion of our inventory is slow moving, expired and/or obsolete
Jason (Warehouse Foreman): Hey Charlie, I know it’s getting sorta late, but the big boss called and said this order really needs to get out today. Can you jump on it next?
Charlie (Warehouse Operator): Sure, let me see the pick list. Hmmm, I’m going to have to move a lot of that old inventory out of the way if I’m going to pick the exact batches you’ve selected. Can we substitute? There’s a bunch of new batches that are sitting right out front. I could pick those lickety-split.
Jason: Well, they really want us to do First-In, First-Out, but I see what you mean. Moving all those batches will take forever. Dang it. Okay, pick the new ones.
Overage and obsolete inventory is not just a financial burden, it’s an operational burden. It constantly gets in the way of normal warehouse operations, which makes it difficult to adhere to good FIFO practices, which in turn contributes to further aging. It’s a vicious cycle. Break the cycle! Don’t just workaround your aging inventory – deal with it!
You can’t build a world class ERP system on a broken business process foundation.