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How to Improve Inventory Tracking?Simple Guidance for You in Inventory Management

With the rapid development of third-party logistics, 3PL‘s advanced inventory management system can save you time and money.

However, for companies with relatively small business volume, in-house management is still required. Choosing the right inventory tracking method can help improve inventory accuracy.

What Are the Types of Inventory?

Before you can improve warehouse management, you need to understand the inventory types accurately. The following are the different types of inventory:

How-to-Improve-Inventory-Tracking?丨Lynda.com丨ChinaDivision
How-to-Improve-Inventory-Tracking?丨Lynda.com丨ChinaDivision
  1. Raw Materials, materials used to manufacture products
  2. Work-in-Progress, unfinished product being produced
  3. Finished Goods, finished goods stored in the warehouse, waiting to be sold or shipped
  4. Overhaul/MRO, maintenance, repair, and operation supplies, items used to support and maintain the production process and its infrastructure. These items are usually consumed due to the production process’s needs but are not directly part of the finished product. MRO inventory includes lubricants, cleaning supplies, gloves, packaging materials, and other supplies. It also consists of some office supplies, such as staples, pencils, copy paper, etc.
  5. Transit Inventory, the items have been loaded and are in transit.
  6. Anticipation Inventory, to meet the expected surge in sales inventory
  7. Decoupling Inventory, supplies, or products reserved in anticipation of stagnation in some production links
  8. Cycle Inventory, products shipped from a manufacturer or supplier to a company, and then sold to customers immediately
  9. Theoretical Inventory, the inventory rate in and outreaches a balanced ideal state, and inventory products can pass through the manufacturing system’s minimum stock without waiting. But in reality, the warehouse will always have some inventory (such as MRO inventory, decoupling inventory, etc.)

What inventory tracking method is the optimal solution?

Manual tracking

You must complete the inventory count for the outbound and inbound warehouse inventory in the manual tracking system. Besides, any updates to inventory records require manual operations. You can manually copy the item number and any other relevant details, but this inventory tracking method can be time-consuming and has a higher error rate. But one advantage is that you don’t have to pay for barcode scanners and other expensive equipment.

Barcode and QR code tracking

Bar codes or QR codes are commonly used in inventory tracking. The inventory system automatically extracts detailed information by scanning the product barcode or QR. The administrator can quickly and easily change the information in the system. This inventory tracking method can achieve efficient inventory management, so 3PL service providers usually recommend this method.

RFID tracking

As with barcode and QR code tracking, you can use RFID tracking to scan products and automatically extract their detailed information. The main difference between RFID and other scannable codes is the technology behind them. RFID tags scan more comprehensively, so they are very useful for inventory systems that move many products. However, only a few inventory management software supports RFID tracking because it requires specialized (expensive) tags and scanning equipment.

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