How to Manage Inventory in Multiple Locations

For manufacturers with multiple locations, managing inventory can be frustrating. Problems like ordering materials on time, utilizing first-in-first-out principles, and storing items efficiently are compounded when you have to coordinate efforts for multiple facilities. When each facility has their own inventory system, it is impossible to maximize efficiency and costs. In this blog, we will cover how to manage inventory at multiple locations effectively.

Create Consistency

Companies that have multiple locations tend to operate differently from one another. Especially in the case of a merger, a newly added facility will have completely separate business processes and software for handling operations. There will always be some unique aspects to each location you work from, but it is essential to unify your organization’s methodology as much as possible. Consistent business processes make hiring and transfers easier, reduce inconsistencies and simplify production. To keep business processes uniform and give all of your teams access to inventory data, manufacturers need to work out of the same ERP or software system.

Having separate ERP and other software for each facility causes data to be inconsistent and disconnected. An ERP designed to handle more than one location will allow each of your production teams to input data into the same place, allowing you to compare performance and identify inventory needs at each location. When ordering materials, you can work from an inventory database for the entire company. This database will include factors like item facility and location, lot control, serial number capture, date code tracking, catch weights, inventory aging, and expiration dates. Having this full picture view allows you to coordinate inventory ordering and shipping based on where jobs are being completed and the cheapest transportation strategy. Although necessary, it can be complicated to set up an ERP to function for multiple facilities. As ERP experts that have offered thousands of software solutions, Datix can help. We are a one-stop shop, meaning our team is knowledgeable about all the major ERP applications and can give you nonbiased advice about what ERP is best for you. If you already have an ERP, Datix can assess your system to increase your competitive advantage and align it with your businesses processes. Learn what Datix can do for your business.

An ERP isn’t the only piece of software that may run out of each of your facilities. Manufacturers may use CRM, BI, IoT or eCommerce software in addition to an ERP. If you have disconnected software, use an integration to get the most out of your system and support inventory management. An integration provides a single source of truth for companies, allowing you to close more deals. For instance, when ERP data is accessible in your CRM platform for Sales, then your associates have the data they need to impress prospective customers. When sales increase, it becomes more important than ever to have a strong inventory management system based on all of your company’s data to predict demand moving forward. To operate your entire business out of one system, look to an application like Unity: Integration by Datix. Unity was built for manufacturers to gain a single source of truth for their data. Learn how Unity can save you money and increase profits.

Maximize Layouts

To access inventory easily, you must maximize your facility layouts. Since the pandemic, many manufacturers are moving away from a just-in-time inventory storage philosophy to a just-in-case one (or they are at least expanding their safety stock in case of emergencies). In this environment, utilizing space efficiently is critical. Frequently used items should be findable in set locations near the workstations that need them. The most popular finished products should be close to your shipping area for fast delivery. In addition, it is necessary to use first-in, first-out principles for inventory so that you avoid allowing items to expire. To execute first-in, first-out, it is necessary to carefully choose which locations should store what items and their quantity. You don’t want to continuously waste time and resources shipping items from one location to another unnecessarily. To maximize your storage use, it is important set up your storage plan carefully while having the flexibility to change it over time. With Datix as your ERP partner, you will receive assistance throughout every phase of your implementation journey. From planning and setting up your new system to maximizing outcomes, our team is here to support you.

Demand Planning

Demand planning is critical for managing one’s inventory. The danger of a just-in-case methodology is that manufacturers will pay extra carrying costs and require more storage for their inventory. The solution to this is to have accurate demand planning through an ERP so that you do not over or underorder the items you need. Forecasting demand also frees up capital, allowing you to take advantage of unexpected opportunities in the market. Using a modern ERP system, you can utilize statistical demand forecasting principles by:

• Considering product-specific factors
• Identifying seasonal demand patterns
• Refining forecasting parameters to reflect volatility in the market
• Allowing for qualitative demand insights

Forecasting is an important but challenging requirement of manufacturers (read more about How Forecasting Impacts Inventory Turnover). If you need support with demand planning, look to an ERP consultant like Datix. We take a business-first approach with our clients by understanding every aspect of their organization so that we can offer them the best software solutions possible. Because we understand your business, we promise to maximize your competitive advantage by giving you the software strategy you need to succeed. Learn more about what Datix can do for you.

Wrap Up

Inventory management is complicated, but the right software and support can make it simple. To get the most out of your ERP’s inventory management capability, work with a nonbiased consultant like Datix.

Discover How to Prioritize Your Inventory

About Datix

With over two decades in the industry, Datix is the ERP consultant of choice for manufacturers and distributors. We believe in “being the best with the best” and look for partners who match our commitment to solving real issues and doing what it takes. Our in-depth analysis of our clients and their business needs allows us to maximize their software investments to the fullest.

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