Inventory Balances

If you are in the food industry you already know that one of the primary challenges is your inventory level.  You need enough supplies to satisfy customer demand, but not too much due to obvious reasons of expiration dates and potential spoilage. 

Enterprise Resource Planning (ERP) solutions are designed to streamline operations and provide a central repository of information to effectively manage inventory processing.

A case study - VAI S2K Food: Hillcrest Foods, Inc.

Do you walk around and “look” at inventory to guess and gauge usage and need?

Many food distributors do just that.  They have been in business a long time and there is built in knowledge of customer and seasonal demand.  What moves, what does not and what to do with surpluses or not having sufficient supply and cost expense of expediting replacement inventory?

How does your organization handle recalls and FDA requirements (FDA Food Safety Modernization Act - FSMA)?  Do you have the ability to include all lot numbers on products and paperwork?  How much time and effort does it take you to process a recall?  What about the paperwork and certificates of origin?  Where are these documents found and how are they linked to your inventory?

If you are processing food inventory manually, then your ability to meet the FSMA requirements will be limited and expose your business to great risk and regulatory nightmare.

How efficiently do you process your distribution, truck loading and routing?  What tools does your ERP solution provide to ensure your customer needs are met?  How long does it take to train your workforce?  Is the equipment and process intuitive?  How many times during the day do they have to look up information and how much time does it take?

Handling inventory is a primary focus of food distributors as is financial processing.  You need to service your customers, yet also manage their credit usage on the Accounts Receivable (AR) side and expenditures via Accounts Payable (AP) on the vendor/supplier side.  The General Ledger (GL) ties all the various aspects of the financial reporting and forecasting together.

If these topics strike a nerve with your organization and you are curious if you are doing everything reasonably possible to empower your workforce and drive efficiency in your operations, then it is time to contact Dolvin Consulting.  We work with industry experts to help you look at and evaluate your organization from a fresh perspective.

We look forward to serving your needs.

Warehouse Management

There is a difference between inventory control and a Warehouse Management System (WMS).  Inventory systems keep track of product information, locations, and quantities.  WMS systems keep track of the movement of inventory.  An inclusive Enterprise Resource Planning (ERP) solution incorporates both. 

 

ERP is designed to integrate the entire organization.   That is where the drive to efficiency is able to achieve its Return on Investment (ROI).  It is the way the right hand knows what the left hand is doing.  The brain of the system like the brain in your body is right in the middle, top front.  It collects and coordinates the information it receives from its various sources, analyzes that information and provides feedback. 

 

Warehouse management systems help in managing the supply chain and tracking the movement of inventory from receipt, put-away, movement and replenishment, to pick pack and ship operations and cycle and inventory counting.  Technology is the backbone that, when implemented with the right strategy, delivers the efficiency needed to compete and ultimately deliver better customer satisfaction.

 

Monitoring warehouse activity in real-time, minimizing entry errors through automation, collecting data to measure efficiency of operations and labor are important aspects of any WMS system.

 

In order to make intelligent decisions, management needs access to as real-time information as possible.  Too much happens too quickly to have to wait hours, days or weeks to get critical information and decipher that information.  ERP systems when properly implemented are able to furnish this information in a format that makes sense.  Managers need to know what their employees are doing, where there are bottlenecks and how to address those issues.

 

Some of the benefits of WMS systems include (in real-time):

• Verifying receipts against purchase orders at the time of receipt. 
• Verifying picked items and quantities against customer orders before shipment.
• Keeping track of batches, lots and serial numbers. 
• Bar-coded inventory. 
• Tracking inventory by the piece, case or pallet. 
• Measuring employee productivity.
• Optimizing picking for single or multiple orders.
• Integration with common carrier systems to capture box information and tracking numbers.
• Customer returns tracking.
• Work-in-progress tracking.
• Production posting.
• Replenishment activities.
• Count-back verification.

WMS information can be used to properly organize the physical locations and pick order to increase employee productivity and accuracy.

 

More efficiency opportunities. 

 

More accuracy opportunities.

 

At first glance it might seem that implementing a WMS system would be too complicated for your workforce and if it could be implemented, the processing would slow down.  Do not underestimate your workforce when you enable them with the proper tools to get their jobs done.

 

For example, count back systems generate confidence in picking operations, because workers learn that they can trust the system to identify where the inventory is located and that the right quantities exist.  They learn the system recommends the right product placement so the do not have to waste time going back and forth to pick orders.  Compare that with an order that was picked and shipped incorrectly.  What happens to customer confidence in your operations?  How will management look at employee productivity?  What costs are incurred by the customer service and finance department, because they have to take care of upset or disappointed customers?  How much time does it take away from their other tasks? How much time does it take to create the return authorization, process the credit, create a new priority replacement order and absorb the associated and expedited return and replacement shipping costs?

 

Greater, more accurate throughput, inventory turns and employee productivity.

 

How is your organization taking advantage of WMS?  What efficiencies did you discover that you did not realize that you would have before implementing your WMS solution?  What solution works for your environment?   Is it a separate system or a fully integrated solution?

 

Contact us today to share your knowledge.  Your fellow readers would like to know.  We are here to help.  Dolvin Consulting works with industry leaders to help you help your organization with knowledge and industry resources.

 

FIFO Inventory and the Need for WMS

There are many people seeking advice lately on how to implement various First-In-First-Out (FIFO) inventory control systems.  FIFO is simply a matter of using the oldest stock first.  If you imagine produce like bananas or lettuce, then the concept is clear.  Use it before it goes bad.  The newest inventory should have the longest shelf life.  Nuts and Bolts, for example, do not typically go bad in time, so there is less pressure to use them in any particular order.

There are numerous strategies about shelving types, flow systems, drop down, gravity feed, pallet systems.  Many people wonder about the paperwork, using colored paper and labels to indentify a product’s month of origin (this would not likely work for the food industry). 

 

There are suggestions about numbering systems, advice on paperwork, missing and reprinting, mapping the physical space, location of items, etc.

Granted warehouse efficiency is very important and physical layout and shelving is important, but the critical thing missing from the discussions was the need for a Warehouse Management System (WMS) that is fully integrated with an Enterprise Resource Planning (ERP) solution.

 

Why are people so anxious to help so quickly that they forget to mention the basics? 

 

A WMS system is to inventory like mortar is to a brick wall.   A good system will generate labels, if needed.  Will automate receiving and put away activities, physical inventory and cycle counting, pick, pack, verify and shipment processing.

 

We will talk more about the details of how a WMS system achieves the goals of efficiency in the future.  For today, we need to agree that there should be a system and that system should be managed by a solution that will let the people running the business to run the business.

 

If your employees are losing paperwork and you are reprinting papers, if you cannot find inventory, if excess inventory is being purchased, if employee labor overtime costs are soaring, if the only time you are sure about your inventory balances is when you are out of stock, then you have problems that can be addressed with a WMS solution. 

 

You cannot buy a software solution that will eliminate obsolescence, the need for training or common sense. 

 

A solution needs to become part of your organization’s culture.  Once people see the system working, their confidence will rise and the efficiency and savings will come.  But, only after the investment is made.  You cannot harvest a crop that you did not plant.

 

Now is the time to contact Dolvin Consulting.  We partner with industry experts to learn, understand, and address your challenges with simple to use, yet powerful systems.  We work with your team to match your challenges with available solutions.  We achieve great Return on Investment (ROI) so the systems implemented end up paying for themselves.  Contact us today to see how we can help your company.

Radio Frequency Identification (RFID) Technology Increases Efficiency

As inventory control technologies continue to evolve, opportunities for distribution and manufacturing companies to streamline warehouse and shipping operations increase.
 

The evolution of Radio Frequency Identification (RFID) technology comprises a prime example.  RFID is a method used to identify, store and remotely retrieve data using RFID tagging devices.  These RFID tags, which can be attached to materials or merchandise and then scanned, transmit information via radio waves to a database.  The RFID tag may contain information such as product type, quantity or suggested retail price.

Mike Moser, Director of IT for Haier, summarized the problem, “To implement the technology successfully, yet remain cost effective, we needed a software solution that we could integrate seamlessly and securely with our existing enterprise resource planning (ERP) package.”

 

Click here to read the full story.

“The knowledge that VAI could design a secure and seamless RFID solution to work as a part of our ERP package—and not function as a mere add-on—was perceived as a tremendous benefit.  The fact that VAI’s ultimate solution had broad applicability, beyond Wal-Mart’s requirements, put us way ahead of the curve in anticipating future demands for RFID tags.”

 

Since its implementation in January 2007, the completely integrated system has provided increased coordination and a higher level of efficiency between Haier’s distribution operations and Wal-Mart’s warehousing facilities.  Haier is now equipped to handle Wal-Mart’s mandated RFID system as well as the anticipated future requirements of other big-box retailers.  Aside from minor visual changes to Haier’s shipping labels, VAI’s solution has made this changeover a seamless, simple process.

The title of this posting should be “Partnership Makes the Solution Work”. 

 

There are many RFID solutions available today, more so than back in 2007.  Five years is a long time in technology circles, but the core notes here transcend current buzz words.

 

·         One- Haier has a partner and that cares about their success and not just in profits.

·         Two- The partner, VAI, took the time to listen and find the right-size fit solution. 

·         Three- Haier did not just implement a slap-on solution.  Their solution lays the foundation to future growth.

·         Four- Increased efficiency. 

Because of their size Walmart is able to trend industry objectives to greater efficiency.  For some organizations the changes can be painful.  The changes never seem to be timed right or easy to implement.  But that is just the point.  Whether you like Walmart or not, they are streamlining an entire industry.  What lessons can be learned by their initiatives? 

 

A lot of operations would be inefficient when done one at a time. 

 

How costly would a piece of plywood be if you only made one?  When you scale up to make thousands, the costs are distributed over a greater number of products and what was not feasible becomes possible.

 

VAI has helped Haier take a step forward in compliance and hence has made their own operations more efficient.

 

More efficiency generally reduces costs and leads to increased profits.  Dolvin Consulting helps Manufacturers, Distributors and Specialty Retailers streamline their operations so they remain competitive.  Contact us today to see how we can help you achieve your goals.

Warehouse operations run more efficiently when processes are fully automated and integrated

Cheryl Nylund remarked, “VAI’s S2K suite has delivered on its promise to streamline our operations and provide maximum visibility of key business operations.  For Randa, S2K’s automation capabilities have provided the foundation on which to fuel our continued growth and success.”

Simplifying the picking and inventory management process was the chief motivation. 

 

Enterprise Resource Planning (ERP) solutions play an integral role in integrating and streamlining computer operations.  The melding of workflow, labor and physical resources.

 

Read the full story by clicking this link.

Randa Luggage wanted to work with a local software developer who had the experience to help them implement a total WMS solution.

 

Their chief concerns are fairly typical of wholesale distributors, they wanted:

·         The ability to view the real-time product availability.
·         Improve order accuracy.
·         Streamline operations.
·         Reduce labor costs.
·         Increase shipping speeds.
·         Expedite billing procedures.

Results: The company now has total, multi-dimensional inventory visibility.

 

Randa was confident that VAI understood the company’s concerns.  This is easily one of the most important points and is critical for any successful ERP selection and implementation.  You need the right partner.  The word "partner" is correct.  You are not buying a boxed copy of software off the shelf.  Enterprise Solutions require good matching of challenge and solution, careful planning, training, implementation, and testing. 

 

A quick sale customer – vendor relationship will not work.

 

In utilizing VAI’s WMS and ERP solutions, Randa has unlocked the inventory information it needed to service its client base effectively.

 

Customer service. 

 

On the part of the ERP solution provider and on the part of this organization ability to service their customers.  A chain is only as strong as its weakest link.  The relationship between this organization and VAI provides a backbone of support that allows Randa to concentrate on their customer’s needs by utilizing their new ERP solution.

 

Dolvin Consulting has partnered with VAI and IBM to deliver good fit ERP solutions to Manufacturers, Distributors, and Specialty Retailers who primarily struggle with warehouse and inventory control issues and are frustrated by the constant flux of technology.  We are your partner guide to helping you understanding your challenges and available solutions.  Start today by contacting us for an initial consultation.  There is no-charge for the call and nothing to lose.

Most Mid Size Companies Already Have an ERP System

To remain competitive organizations of all sizes, but in particular, midsize companies must integrate their operations across their enterprise.  This integration should include as many department or function roles as possible.  The tighter and more completely your company communicates, the greater the potential Return on Investment (ROI). 

Separate systems or systems loosely connected with manual procedures are obvious candidates for updates.  What may not be obvious is the effect of Mergers and Acquisitions has on the industry or having an older system.  Older is relative, but if your system is more than five years old, your team should at least be talking with your advisor to learn what is available.  You do not necessarily have to make changes, but you should be aware they exist.

Has your organization created its own application extensions to meet your needs?  Custom solutions are great, because they are built to your specifications and needs.  Bad, in the sense that now you have something that must be re-integrated, re-engineered, or thrown away with an upgrade or new system.  A new system that already has those functions built-in is insurance against obsolescence.

What you may find is that your current software vendor already has upgraded your software and it is the most logical solution for your growth.  Same equipment and familiar interface methods reduce the impact of the learning curve and speed adoption of new features to enhance productivity.

Standardization of systems, reduction of power usage, simplification of management and maintenance are also components to consider when calculating your Total Cost of Ownership (TCO).  Of course there are upfront costs associated with anything new, but these can often be offset by savings and increased efficiency.  Why else would you consider making such an impactful change?

Your advisor is a critical component.  There is just too much information to sort through on the Internet.  Your advisor knows you best and can help narrow the field of interest.  This narrowed field is more easily researched, because you now know what you are looking for.  Let your advisor pick the weeds out of your garden.  That is why you invest in one. 

Are you looking for better ways to service your customers?  Better ways of communicating with your suppliers?  Implementing EDI, Barcodes, Wireless technologies, RFID, Voice picking?  Does your purchasing team need a better way to calculate suggested purchases?  Perhaps your system works, but you need a better way to schedule routine tasks or receive notifications of critical events. 

Maybe you need the same output in a more user friendly format such as PDF’s or Spread sheets.  How fast does it take to check someone out at your Retail/POS stations?  After checkout does your Ecommerce site know the inventory is gone or do you have to manually update availability? 

Do you need integration with shipping companies or truck routing?  Perhaps knowing and tracking your Landed costs and rolling them up in your product costs is a factor worth investigating.  Do you know how much your product costs and therefore your profit margins?  Does management have the tools to determine trends in your sales?

If you want specifics, then we need to talk.  No one knows your business better than you do.  It takes time to build a relationship of trust and understanding. Time to know what the impact of change will be to your organization.

No short or long article online will replace a face-to-face meeting.  There is no commitment other than to look, ask questions, and see what alternatives you have.  Contact Dolvin Consultingtoday.  You have challenges, we havesolutions.  Let us determine if there is a match.

Problem: Picked/Shipped Wrong Product. Result: Charge-Backs.

Wholesalers move toward intelligent warehouses.  Automation increases inefficiencies.  No matter how modern a warehouse, if it includes overhead costs, paper processing or manual processes, there is room for improvements.  Evidence would be workers sent to the wrong bin slots, picking the wrong products, or shipping the wrong products.

Click here for the Video.

Click here for a PDF file.

More accurate shipping means less returns and more customer satisfaction.

Intelligent, instrumented and interconnected warehouses enable the ability to respond to supply and demand from market fluctuations.  Purchasing can be done at a more accurate level, which results in not holding on to inventory for extended periods of time.  Something food processors are keenly aware of. 

Monitoring customer needs, having inventory on hand and available, knowing what is happening in real-time.  These are key concerns for any distribution operation.  Automation through bar codes and Radio Frequency Identification (RFID) tags enable automated tracking and inventory processing much faster and accurately than manual paper processing.

Other automations include portable printing systems, such as belt printers, which save time and increase accuracy.  Voice response units enable hands-free picking increasing safety, saving time and energy, and increases accuracy of orders.

How much nicer would it be if your orders were accurately picked and shipped?  Easier on the workers in your operations, easier for customer service, happier customers who receive what they ordered on time. 

The alternative is not attractive:

·         First you get the call from an unhappy customer, resulting in time taken away from production.  Hopefully your customer service people are in a good mood that day and can reassure your customers this is not typical of your business. 

·         Then add the time and effort of the computer entry of the return and replacement orders and resulting paperwork. 

·         Do not forget to add in any time for investigation of what went wrong and supervisor or manager approval of the credit.  Your finance team probably has lots of free time anyway. 

·         Then you end up paying for the return and expedited replacement shipment.  Was this one box or a pallet or entire truckload?

·         Add in the time someone takes to pick the replacement order.

·         Add in the time for someone to receive the original incorrect order, inspection, and restocking efforts. 

Your team has spare time, right?  Your business has grown in this economy and you have extra time and personnel to deal with these issues.  You did not have any overtime situations, because of the extra overhead of incorrect shipments, did you? 

Are you saying that this is just a part of doing business?  This does not happen often enough to worry about.  Nothing can be done about it. 

Would adding automation really help?

Warehouse Management Systems (WMS) that are fully integrated with an Enterprise Resource Planning (ERP) system solve these issues.  Especially if it is the right solution.

Too soon to tell, but is it not worth an investment of some time to know you are doing the best you can?   Maybe you do not solve all your issues today, but you put a plan in place to tackle your challenges so that over time you become more efficient. 

Maybe today is the day you pick up the phone and call Dolvin Consulting to confirm you are already doing everything possible in the area of warehouse automation.  Contacting us is the first step.  It is only a phone call.  Hang up if you like.  Stay on the line to move forward.  No promises, just conversation.  We are not out to sell you anything.  We are here to see if there is a match between your challenges and our solutions.