Monthly Physical Inventory Counts are the First Step to Controlling Swings in Inventory
Companies that achieve a more accurate perpetual inventory through monthly or quarterly physical inventory counts receive several positive business benefits:
- Reduced financial write-offs
- Reduced stock outs by ensuring there is adequate material on hand to support the business needs
- Better business decisions (i.e. investment in resources or equipment) and the ability to set more realistic performance goals (i.e. incentives) based on productivity or cost-per-ton metrics
- Meet and exceed audit requirements
Accelerate the Speed, and Reduce the Cost of Physical Inventory Counts Through New Technologies
Technological advances are now shrinking the time needed to perform company-wide physical inventory counts from 3-5 weeks down to 3-5 days. The costs to perform multiple quarterly, or monthly counts are now comparable to the historical price of one annual count. Significant advances in image processing, Software as a Service, drones, and phones make this possible.
Manual photogrammetric processes of the past are now fully automated thanks to advances in image processing and computer vision. High quality cameras embedded in drones, attached to planes, and built into cell phones are more highly available and easier to use than traditionally higher cost GPS and Laser based measurement technologies. The combination of high-quality low cost cameras, combined with advanced image processing enable rapid low-cost 3D modeling from imagery. Volumetric measurements generated from imagery are now an accepted form of aerial survey.
Software as a Service (or SaaS) is a way of delivering applications over the Internet, as a service. Instead of installing and maintaining software, companies simply access it via the Internet, freeing themselves from complex software and hardware management. SaaS companies leverage cloud computing to cost effectively scale operations to meet customer demand.
Leveraging SaaS, image processing, airplanes, drones, and phones makes it possible to accelerate the speed, and reduce the cost of physical inventory counts. The time to perform an inventory count is now only limited by how fast the imagery of stockpiles can be collected. Airplanes can be used to quickly take aerial imagery of hundreds of sites across geographically dispersed operations. Drones utilized by trained professionals – internal staff or external service providers – can be used to obtain aerial imagery at localized sites. And now even your phone can be used.
Using a combination of SaaS and image capture methods makes it possible to complete a company wide inventory in 3-5 days. Thousands of stockpile measurements can be generated from millions of images in just 24 hours. Finance and operations employees quickly review and approve data via a common website, with no need to manual enter or transfer data.
Visit us next week for the final post of this series about Inventory Management for companies with stockpiles: Putting it All Together.
(This blog is a continuation of last week’s post. Read: The Case for More Frequent Physical inventory Counts )