Managing stock is a crucial aspect of running a supply chain. All vertical industries have their specific problems and challenges when it comes to doing so. Rina Redelinghuys, customer services executive at Cquential, examines various sectors, including retail, fast-moving consumer goods, food and dairy, automotive, apparel, industrial, accessories, paint and chemicals, and pharmaceuticals, providing a high-level summary of the top three challenges in each sector, and potential solutions.
Retail
Challenges: Omni-channel stock management, managing returns and seasonal demand.
Solution: Implementing an omni-channel enabled warehouse management system, with a robust returns feature, will allow retailers to streamline inventory processes and reduce losses from a returns perspective. Data analytics can assist in estimating demand more accurately.
FMCG
Challenges: Stock rotation, product freshness and supply chain optimisation, which includes streamlining processes and ensuring efficient and effective delivery.
Solution: Similar solution to retail: implement a warehouse management system, which optimises processes, tracks product shelf life, a good route planning feature and last mile delivery tracking, as well as a strong returns feature and omni-channel enabled.
Food and dairy
Challenges: Shelf life management, temperature control, and food safety regulations.
Solution: Implementing the right warehouse management system optimises stock levels, controls shelf life and expiration dates, and provides valuable data for better analysis. Installing a temperature control system, whether standalone or integrated with the Warehouse Management System (WMS), will also increase control. Also, ensure that necessary controls are in place, adhering to food and safety standards, and, if feasible, accommodate them within the WMS.
Automotive
Challenges: Just-in-time stock management (JIT), fluctuating demand vs. forecasting, and complex supply chains.
Solution: Implementing a warehouse management system, tracking and monitoring stock levels in real time, and maintaining strategic buffer stock levels, mitigating any disruptions within the supply chain. The WMS will also assist with supplier management, from a lead time, quality and reliability perspective. The real-time data can be analysed to identify any changes in demand patterns. It is also worthwhile to consider sourcing or production closer to the end market, reducing complexity.
Apparel
Challenges: Seasonal and accuracy, over-/under-stocking, SKU (product) variety and returns.
Solution: The deployment of a WMS will track stock levels and movements in real time, providing visibility, accuracy, and overall improvements in efficiencies. Again, it is essential to utilise real-time data to analyse demand patterns and value. Implement and integrate a forecasting tool to reduce overstocking and understocking. Use the WMS to manage supplier performance and improve visibility.
Industrial
Challenges: Changing demand, complex supply chain, and warehouse efficiencies.
Solution: Implement a WMS in conjunction with a demand forecasting tool that will assist with predicting demand and adjusting stock levels accordingly. The WMS will also, through automation, enable real-time tracking of stock levels and simultaneously set and utilise performance metrics to identify areas that need improvement. Unpredictable and complex supply chains make inventory management and planning difficult, but by integrating a WMS into supply chain systems, real-time visibility, improved communication and management are made possible, resulting in reduced errors, while providing valuable insights for informed decision-making.
Accessories
Challenges: Variety, obsolete inventory (also known as dead stock), and supply chain disruptions.
Solution: Keeping track of a variety of products with different styles, designs, and materials can be difficult. Products become outdated, leading to slow-moving or dead stock. Then, delays or stockouts impact stock levels and customer satisfaction. This is where a WMS is a game changer.
Tracking stock levels, locations and movements in real time, by utilising historical and real-time data, seasonal patterns, trends, and demands can be identified and stock levels adjusted accordingly from a forecasting point of view. It can assist in calculating the optimal level of safety stock to maintain, taking into account lead times and fluctuating demand, thereby minimising overstocking, obsolete stock, and stockouts. Ultimately improving overall efficiencies.
Paint and chemicals
Challenges: Restrictions related to sustainability and increasing demand for product performance and efficiency.
Solution: Utilise a warehouse management system to automate workflows and optimise material planning, reduce waste and improve efficiencies. Tracking stock levels and movements of raw materials, work in progress (WIP), and finished goods, making sure the right materials and quantities are available for production. Tracking batches of products, enabling traceability and quality assurance, is crucial for products with specific performance characteristics. Also, ensure that products are handled and stored correctly under the right conditions, enabling operations to respond quickly to changes or demand.
Pharmaceuticals
Challenges: Compliance and traceability, recalls and expiry dates, temperature and environmental monitoring.
Solution: Automated stock levels, tracking in real time is possible with a WMS. Tracking, labelling, and monitoring of expiry dates, as well as managing expiry dates and recalls, to reduce risk to patients. Make use of temperature and environmental management tools for monitoring and managing ideal conditions for ‘sensitive’ products, providing automated alerts and notifications.
For more information contact Cquential,
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