In recent conversations with various companies, a recurring issue has emerged: stock loss. This challenge spans multiple industries, from automotive OEMs and Tier 1 suppliers to packaging companies serving the CPG sector. Stock loss affects items of all sizes, from small parts in boxes to massive reels of paper weighing tons.
Stock loss can stem from various causes:
- Incorrect part movement
- Scrap from damaged or dropped parts
- Shipping inaccuracies
- Manual process errors
- Supplier performance issues
- Forecasting inaccuracies
- Split shipments causing reconciliation problems
The repercussions for businesses are severe, including delayed production runs and disrupted customer service. These delays often lead to expedited freight costs and increased cost of goods sold, directly impacting operating margins. Companies frequently recognize that many of these issues are avoidable.
Process monitoring can help address these issues. Many stock loss problems arise from process inefficiencies, like inaccurate purchasing and poor shipping procedures. For example, one company discovered that their ideal process was adhered to only 80% of the time, with over 140 different process variations identified. Process Intelligence offers a data-driven approach to uncover these inefficiencies, enabling companies to address root causes rather than just symptoms. To explore how Process Intelligence can help reduce stock loss and enhance supply chain value, contact QAD.
Read Complete Article Here
