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Inventory shrinkage simply refers to a loss of inventory. Shrinkage typically occurs due to theft, damage/spoilage, or errors by administration. Though inventory shrinkage can be a big problem for businesses which carry goods, the issue can be greatly reduced by putting in place proper monitors and controls
1 Preventing Employee Theft 1.1 Educate and train employees properly. 1.2 Secure your storeroom 1.3 Tighten your receiving practices. 1.4 Install surveillance cameras. 1.5 Monitor valuables closely. 1.6 Separate duties among more than one employee.2 Decreasing Customer Theft 2.1 Use security cameras and mirrors. 2.2 Implement store policies that will cut down on theft 2.3 Ensure employees are aware of scams 2.4 Keep your store clean and well-organized 3 Avoiding Administrative Errors 3.1 Be aware of the most common types of administrative errors 3.2 Conduct audits consistently. 3.3 Automate your inventory through a software solution.
3.4 Pay attention to spoiled or broken items.
The effective stock management is a two way affair between sales team and inventory department. There are multiple aspects comes into play while having an productive stock such as.
1.Previous 3-5 sales trend.
2. Sales Forecast report.
3. Product line profit margins
4.Constant reviewing of sales team target acheivment and hot prospects.
5.Healthy work environment among the sales team and inventory planners and effective communication.
Hope this would resolve most of the stock issues offten experience by stock Management team.
The best way to avoid out of stock is
- Performing a good forecast: a good forecast allows your company to make sure that the amount of inventory needed is purchased. It also if well executed allows to pinpoint the items that move faster compared to your procurement planning. Historical record is needed to perform a good projection, although forecast is not an exact science it is a good tools that will give control over your procurement planning.
- Establishing a safety stock at all time: Still in the forecasting idea, the safety stock is required to prevent any logistical issue on the supply side including: supplier production disruption, transportation issues, natural event that can interfere with the seamless flow of raw materials.
Thanks for inviting me here there are few points needs to be maintained in order avoid the negative stock.
1) Keep updating the stock received and stock issue records.
2) Inventory budget should be observed accurately
3) Store keeper should maintain proper record for every "IN"(Material received voucher) and "OUT"(delivery note) both manually and post the same in ERP system so that the finance department will know about the stock received and they can proceed according for further entries.
Thanks for invitation
The best way is to use the planning and budgeting, economic quantity order.
The inventory budget will enhance the performance of the inventory.
1. By using {first in - first out} method
2. Reducing ratio of goods return
3. Implement proper item code
4. regular ERP Posting
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