Inventory management with a barcode reader

[Iccanui]

Greetings,

I am trying to create/find a cheap and simple inventory system for a very small business. We create frozen raw catfood and package them in tubs. We have a UPC code for each item. What I would like to do is when we create a product, scan it into a inventory system so that we can look and see how much we have on hand and also scan as we ship our product so we can track the stock depleting, as well as alert us if possible when stock reaches a certain level for a item. Ive been looking for quite a long time at things like skyware and salesbinder and inflow and so forth. But it seems im not finding something that can just perform the simple task of reading a bardcode and adding or subtracting it from inventory.

Anyone have more experience in this and willing to share your knowledge?

Thank you for your time.

[Fulcrum]

I've found that many times these systems are usually custom built. Yes, there are generic systems available, but when you want it do do a very specific task, custom is generally the way to go.

[nealrm]

You're looking for software to handle an inventory situation where there is a simpler, better and much cheaper solution. I suggest you look into a kanban system. (Not a computerized kanban system, but a true kanban system). They are extremely simple and easy to implement. Manufacturing attaches a card to each unit of production, when the unit sells (or shipped) the card is returned to production. The card returning is the trigger for manufacturing to create another unit. For systems that batch produce, the cards are collected after the sale until the batch point is reached. In those case, the kanban are normally displayed in a prominent location. If possible that actual container that holds the item can be used as a kanban card. Kanbans are unique to the product. (example: if you produce 3 products, you will have 3 sets of kanban cards) Either way the number of kanban in the system control the amount of production. You will not produce more units than the number of cards in the system. If you continually run out of inventory, increase the number of cards.

[Iccanui]

Ok great.


Thanks a lot for your time guys, its very appreciated.

[Calcul8or]

Hi,

We are Supply Chain and Operations Management Automation Specialists, and would like to assist you with your needs.

We've developed a system that tracks Inventory and Stock requirements by creating a forecast based on historical sales that can be reviewed, altered and re-imported into the system to create recommended orders per sku based on demand, lead times, minimum order quantities, preferred order frequency and safety stock requirements.

It also creates a 12 month outlook which projects your future stock situation. It is also possible to generate reports by sku by supplier or by customer.

We can also customise any part of it to suit your specific needs.

I hope we can be of assistance to you, or anyone else seeking a customised solution to any business problem.

Kind regards,
Shail

[Calcul8or]

You're looking for software to handle an inventory situation where there is a simpler, better and much cheaper solution. I suggest you look into a kanban system. (Not a computerized kanban system, but a true kanban system). They are extremely simple and easy to implement. Manufacturing attaches a card to each unit of production, when the unit sells (or shipped) the card is returned to production. The card returning is the trigger for manufacturing to create another unit. For systems that batch produce, the cards are collected after the sale until the batch point is reached. In those case, the kanban are normally displayed in a prominent location. If possible that actual container that holds the item can be used as a kanban card. Kanbans are unique to the product. (example: if you produce 3 products, you will have 3 sets of kanban cards) Either way the number of kanban in the system control the amount of production. You will not produce more units than the number of cards in the system. If you continually run out of inventory, increase the number of cards.

Kanban is without doubt one of the most effective ways to manage inventory, and was pioneered by Toyota. However, one of the greatest setbacks when applying this system to smaller operations is that Toyota were able to ensure their systems were transparent and secure enough to allow their suppliers to be kept informed of the depletion of teh components they supplied. This meant that rather than Toyota having to carry large quantities of stock, as you would if you have factors such as supplier lead times and MOQs to deal with, their suppliers were required to carry that stock themselves, thereby dramatically reducing the cost of carrying inventory to Toyota.

I doubt very much if a smaller organisation would have the same clout and negotiating power as Toyota to make Kanban a system that works for them, while ignoring all the other factors that must be kept in mind to manage inventory successfully.

[nealrm]

Kanban is without doubt one of the most effective ways to manage inventory, and was pioneered by Toyota. However, one of the greatest setbacks when applying this system to smaller operations is that Toyota were able to ensure their systems were transparent and secure enough to allow their suppliers to be kept informed of the depletion of teh components they supplied. This meant that rather than Toyota having to carry large quantities of stock, as you would if you have factors such as supplier lead times and MOQs to deal with, their suppliers were required to carry that stock themselves, thereby dramatically reducing the cost of carrying inventory to Toyota.

I doubt very much if a smaller organisation would have the same clout and negotiating power as Toyota to make Kanban a system that works for them, while ignoring all the other factors that must be kept in mind to manage inventory successfully.

Your statements about kanban systems are incorrect. I have seen them work well in smaller companies and without sharing inventory levels with suppliers. A simple increase in the number of kanban will allow for ordering lead time and if necessary bulk orders. It is also possible to use a kanban system on the finished good side while maintaining a bulk inventory system on the raw material side.

[Calcul8or]

Your statements about kanban systems are incorrect. I have seen them work well in smaller companies and without sharing inventory levels with suppliers. A simple increase in the number of kanban will allow for ordering lead time and if necessary bulk orders. It is also possible to use a kanban system on the finished good side while maintaining a bulk inventory system on the raw material side.

You might be aware that Kanban is one component of the "Lean" system of manufacturing. This essentially is the art of passing the responsibility for holding stock and inventory as far down the Supply Chain as possible. Toyota's aim was to drastically reduce the amount of components it had to carry and store as a means of reducing cost. A very effective way of doing this was to make suppliers deliver smaller quantities more often. The alternative to this is having to place larger and less frequent orders because of factors such as Economic Order Quantities and Minimum Order Quantities imposed by suppliers, which is what smaller organisations are faced with. Situations where the latter is true are subject to waste and obsolescence because demand is more often than not imperfectly forecasted, and so there is always a tendency to overstock rather than understock.

Toyota recognized that the success of such a system would rely very heavily on collaboration with suppliers, and Toyota's Supply Chain even today is one where a Kanban notification on their production line is communicated almost immediately back to the farthest reaches of their supplier network. I have seen this in practice, and witnessed the amazing level of automation on their production lines here in Melbourne.

I think the system more suitable for smaller organisations that you might be referring to that is also part of Lean Manufacturing and the principle of Kanban is the "two bin" system, whereby a production node on a production line will have two bins of components at all times. When one is emptied, it becomes the trigger for replenishment.

Iccanui above stated that the business he works for is a very small one. As such, I doubt very much whether they would have as sophisticated and specialized production lines as Toyota. They would also lack the economies of scale to allow them to organize their suppliers in a way that helped them to reduce their inventory holding costs. In fact, I'm sure in situations such as this the opposite is probably true, where small businesses are at the mercy of suppliers. In these situations, I wouldn't even recommend using an EOQ method of stock replenishment. I'll be very happy to explain why if you like, but that is it's own separate story.

In these smaller arenas, planning becomes vital, and collaboration is very often limited to departments within the organisation rather than with anyone outside of it. Therefore, a Sales and Operations Planning (S&OP) process will be far more useful, because it looks at what the most likely demand will be based on historical sales, but then requires buy-in from multiple departments in the organisation via a "sanity-check" process. The most common procedure is to produce a forecast based on organic historical sales, and then adjust that based on promotional activities the Marketing Dept might be planning, and other factors such as seasonality. Ultimately, smaller organisations will have to carry their stock whether they like it or not. The only way to minimize cost in this respect is to forecast more accurately. If you were absolutely determined to implement a Kanban ticket system no matter what, then it would have to be one between the warehouse and the production line, which may involve creating a whole new process when none is required.

I guess what I'm trying to say here is not that a Kanban ticketing system is absolutely wrong for Iccanui, but that Inventory Management necessarily involves much more than just what happens on the production line. True Supply Chain Management looks at the entire process from Raw Materials to the delivery of Finished Goods to end users. The crucial thing for any business is to be very clear on just how extensive their Supply Chain is, what it includes and what it does not. Then you need to take as many factors as you can into consideration to manage the organization's Inventory, which is essentially an enterprise wide responsibility, not just limited to the Production Line.

[FlyPizzaGuy]

I must say I learned something today. Thanks a million guys.