Traditional inventory audits require physically counting thousands of small components like O-rings, fasteners, gaskets, and other products. The process is tedious, requires massive hours of manpower, and is prone to human error. However, by using the power of RFID technology and a digital vendor managed inventory (VMI) platform, the same audit can be accomplished in about 30 minutes with unparalleled accuracy.
Inventory audits don’t have to be cumbersome and tedious. When using the power of RFID technology combined with a sophisticated digital VMI platform like ShelfAware, the labor is taken off the shoulders of the manufacturer and provided in minutes by the supplier.
An inventory audit is used to cross-check a company’s financial records against its inventory records. It is designed to ensure that the records match the physical inventory count—verifying accuracy and identifying any discrepancies in stock counting or financial records.
Typically, an inventory audit requires shutting down a facility and using many employees to physically count products on the shelf over the course of several days or weeks. By combining a cloud-based, data driven digital VMI platform and RFID technology, that process becomes fully automated with an accurate audit produced in less than an hour.
How to Automate Inventory Audits
Audits are a necessary evil of any inventory management system. Because many supply chains are complex, there are thousands of SKUs. In some cases, there are hundreds of thousands of square feet of actual physical inventory. In some scenarios, the inventory is wide-open with hundreds of users across multiple shifts interacting with the inventory. This can cause discrepancies in the data when managed traditionally.
With RFID smart labels attached to every inventory item, supplier sales representatives can perform accurate inventory audits at any time. Leveraging RFID technology allows for customization and accurate audits of complex supply chains in minutes.
ShelfAware, for example, places the duties of the complicated inventory audit on the shoulders of the suppliers and the sales reps, releasing manufacturers from the tedious task. A supplier or sales representative enters the facility with a handheld scanner that is powered by a simple-to-use mobile digital VMI app. There is no complicated scanner to deal with.
This type of automated inventory audit takes minutes instead of days and is extremely accurate. Because of the simplicity, they can be done more frequently.
Why Manufacturers Perform Regular Inventory Audits
There are many reasons that manufacturers perform regular inventory audits. The most obvious is to ensure an accurate count of all physical components on the shelf. It’s also a good idea for insurance purposes. A quick scan of an entire room of inventory can create detailed reports to determine the dollar amount of inventory on hand. This ensures better insurance reports and rates.
Inventory audits are helpful for calculating profits, creating more accurate budgets, and identifying inefficiencies in manufacturing operations. Often, companies have poor tracking methods and might not actually know their current supply levels. They may be selling products that are already out of stock or planning production runs without enough materials.
The solution to these complicated inventory issues is to carefully track materials and products so that you always have necessary products at hand without being oversupplied. And the first step in managing your warehouses is to perform an accurate inventory audit.
Inventory audits can be tedious and time-consuming, but cutting-edge platforms like ShelfAware can reduce the burden while providing you with the necessary insights to improve manufacturing operations.
To see how fast you can do a physical onsite inventory audit using RFID technology and ShelfAware, watch this video!
It’s Easy for Contractors to Manage Complex Supply Chains
Implementing ShelfAware’s robust platform is often complex but does not need to be slow. It begins with a group conversation involving a mix of finance, operations and IT professionals. A site audit (often multiple sites) is usually required before a proposal can be made.
Final proposals usually involve a formal stocking agreement, installation fee, and a product pricing quote. Onboarding consumers varies widely, but the minimum time required to convert a supply chain in most markets is about three months.
Want to learn more about an affordable way to automate your supply chain? Request your free ShelfAware demo
Too good to be true? ShelfAware is redefining the vendor-managed inventory industry. For this reason, we’re happy to talk to you about how our intelligent inventory platform can benefit your business. Contact us today for more information.