Steps to Control Inventory Flow & Boost Warehouse Efficiency


In Brief

Control of inventory flow.  Application of various technologies and work systems to manage and boost visibility.  Intensified checking on all activities to ensure accuracy and suitability.  These factors should ultimately lead to a boost in warehouse management efficiency.


Control of inventory flow is among the most important issues with regard to warehouse management.  This is because controlling inventory flow is crucial for warehouse management efficiency.   The following guideline for warehouse management could be just a preliminary step toward enhanced inventory management and control resulting in the reduction of unnecessary business expense and, in turn, appropriate business capital and better competitiveness.

1.Starting Out By getting rid of the Least Needed Products

Warehouses tend to easily become the storage for old stock of goods.  The first step for efficient inventory control is to get rid of unnecessary goods including devices and equipment that are either hardly used or irrelevant to warehouse operations  (with the exception of special equipment for moving large-sized goods).

2.Wave Picking

Wave picking has for several years been a standard process of warehouse management as well as of picking up goods in a warehouse.   However, given the ever increasing diversity as well as conditions inherent in the availability of goods nowadays, certain existing services that used to be successful in the past may no longer be relevant or effective, especially with the growing e-Commerce, which means customer demand for swiftness, convenience and increased product diversity.  Locating and picking goods in warehouses prove time consuming and not conducive to the growth of e-Commerce.  Thus, to enhance inventory control and boost warehouse efficiency, we have to resort to a waveless picking strategy which allows for better flexibility due to the fact that purchase orders are not grouped together but processed by an assessment system to ensure more swift and efficient picking via order streaming (the software in use at warehouses or distribution centers to solve complication problems pertaining to the order of picking – the system that decides for us what, where and when to pick for optimized efficiency).

3.Use the system to help review products before the next lot is ordered

Before ordering the next lot of goods, we must first take into consideration the flow of such goods to find out whether or not they are still in market demand and to which direction the trend points.  This will help prevent the purchase of slow-moving goods while contributing to the suitable size of inventory.  More importantly, a review of goods that concurs with the consideration for storage space means a boost in efficiency as regards utilization of warehouse space and, last but not least, our ability to respond to customer demand during high season.

4.Application of Automation Technology

While automation technologies such as the Radio Frequency Identification (RFID) designed to help enhance warehouse visibility and transport and the Automatic Storage and Retrieval System (ASRS), the technology focusing on automatic storage and picking, can just as well boost warehouse management efficiency, initially, they are cost- and maintenance-cost-intensive.  Thus, their application feasibility and relevance to our own business over the long run must also be taken into consideration.

5.Efficient Return Management

Handling returned products is part of inventory management. Even the best order processing programs will not prevent returned products. It does, however, minimize returned items. Efficient returned products management can help to streamline the process. For example, the cause and value of goods returned, selling possibility/impossibility of goods returned and possibility/impossibility to accept goods returned on the part of other sellers.   (Each seller has his own conditions, for instance, one scratch on the same item might be considered justified for the cause of customer’s returning goods for one seller but the condition worthy of acceptance  for another.)   If the process is strictly and accurately adhered to, cost and operating costs should considerably and successfully be reduced.

6.Utilization of the System and Third Party Service Provision

At certain periods of time such as during high season, warehouse management today is unable to keep abreast of customer demand and e-Commerce growth.  Perhaps it’s high time for us to consider third party’s service provision to boost warehouse efficiency via system links or freight transport fulfillments.  A third-party logistics service provider, in particular, has an active role to play in the enhancement of inventory management efficiency by enabling the company’s access to advanced supply chain system operated by professionals throughout the entire process.

7.Audit, Audit and Audit

Auditing is a key process to the reduction of problems and enhancement of inventory efficiency.    Every purchase and sale should be audited to ensure accuracy and problem feasibility.   More and more companies have nowadays resorted to avail themselves of third-party auditing altogether to reduce unnecessary internal work processes.

At any rate, for such inventory management to bear fruit requires appropriate human resource management on the part of the business or suitable authorization and control on the part of personnel in charge of inventory.  Thus, providing staff with progressive inventory related education, skill development and updated knowledge is crucial and must be concurrent with not only on-the-job training but also the company’s commitment to its staff’s happiness at work as a turnover reduction measurement.   Of equal importance, meanwhile, is operational business circulation.  With an absence of technological infrastructure required to replace manpower-tasks effectively, businesses are compelled to take a second look at their ‘in-house’ affairs.

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