Inventory Management System

Inventory Management

Efficiently managing raw materials, work-in-process, and finished goods.

Inventory System Overview

We use a perpetual inventory system:

• Real-time tracking
• Barcode scanning
• Automatic reorder points
• Cycle counting
• FIFO (First In, First Out) rotation

Receiving Materials

When shipments arrive:

1. Dock Receiving:
   • Check packing slip vs shipment
   • Count quantity
   • Inspect for damage
   • Scan receiving barcode
   • Create discrepancy report if issues
2. Quality Inspection:
   • Pull samples per procedure
   • Inspect to specification
   • Approve or reject
   • Tag material with QC status
3. Put Away:
   • Move to designated location
   • Scan into storage location
   • Update system quantity
   • Label with date received

Storage Locations

Organized by type:

• Raw Materials: Warehouse racks, labeled by part number
• Work-in-Process: Production floor carts
• Finished Goods: Shipping area, organized by customer
• Bonded Inventory: Secure cage area
• Quarantine: Hold area for rejected material

Issuing Material

Requesting material for production:

1. Generate pick list from work order
2. Print or send to mobile device
3. Locate material by bin location
4. Verify part number matches
5. Pick required quantity
6. Scan out of inventory
7. Deliver to production area
8. Get operator signature

Material Shortages

If material unavailable:

1. Check system for quantity
2. Search alternate locations
3. Verify not already issued
4. Check incoming shipments
5. Notify production supervisor
6. Contact purchasing if needed
7. Create shortage report

Cycle Counting

Regular inventory accuracy checks:

• Daily counts per schedule
• Count assigned locations
• Enter actual quantity in system
• Investigate variances >5%
• Adjust system if correct
• Document reason for discrepancy
• Goal: 95% accuracy

Physical Inventory

Annual wall-to-wall count:

• Scheduled during shutdown
• All employees participate
• Count every item
• Independent verification
• Reconcile to system
• Update financials
• Typically takes 2-3 days

Stock Levels

Inventory parameters:

• Min: Reorder point triggered
• Max: Maximum stock level
• Safety Stock: Buffer for demand variability
• Reorder Quantity: Economic order quantity

System automatically generates purchase requisitions.

Material Returns

Returning unused material:

1. Ensure material is clean and organized
2. Verify part number
3. Count quantity accurately
4. Scan back into inventory
5. Return to proper location
6. Update work order usage

Scrap Reporting

When material is scrapped:

1. Identify cause (damaged, obsolete, quality)
2. Complete scrap ticket
3. Get supervisor approval
4. Scan out of inventory
5. Move to scrap bin
6. Document reason code
7. Finance reviews monthly

Obsolete Inventory

Slow-moving or obsolete items:

• Identified quarterly
• Engineering evaluates for reuse
• Sales contacts customers
• May be written off
• Scrapped or sold as surplus

Consignment Inventory

Customer-owned material:

• Stored in designated area
• Tracked separately in system
• Not included in our inventory value
• Usage reported to customer
• Periodically reconciled

Tool Crib

Tooling and supplies:

• Check out tools with badge scan
• Return when job complete
• Report damaged tools
• Consumables issued as needed
• Annual tool inventory
• Personal tools must be registered

System Access

Inventory software:

• Web-based portal
• Mobile scanning devices
• Access levels by role
• Training required
• Contact IT for login issues