The greatest single asset any business can have regarding its inventory management is nothing more technical than an human being dedicated to the tasks required by inventory. Many businesses rely on machines from data collectors to security cameras but somewhere in the system must be an individual whose thorough understanding and adherence to sound inventory management standards. Armed with the most complete and easy-to-use tools — SIMMS Inventory Management software, for one — this devoted employee can make all the difference to a company’s stock accuracy and customer satisfaction. Someone must thoroughly understand the importance of supply chain science as well as be the versatile and reliable coordinator of physical ins and outs of the business. Inventory Lead Hands are a saving grace and few others have more knowledge of specifics of what you need.
Contact KCSI today to learn more about how a set person can use SIMMS to keep you on top of your stock requirements.
Posts Tagged ‘economic replenishment optimization’
A Technology of One
Tuesday, July 13th, 2010Safety Stock
Thursday, July 8th, 2010One of the factors of finding the Order Point for an item is Safety Stock, which serves as an insurance against stock outs and which helps counteract fluctuations in lead times or demands, as well as increasing your level of service.
A rough formula for calculating Safety Stock is to take half of the sum of your lead time (in days) multiplied by your daily demand (the number of units sold per day). Thus, if you sell twenty widgets per day and your lead time is eight days, your Safety Stock for the item would be 80.
Once you have your Safety Stock number, your Order Point can be calculated using the following formula: Safety Stock + (lead time X daily demand), or in the case of the above example, 80 + 160 = 240.