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Inventory Management

Inventory Management – A Smart Solution to Supply Change Worries

Some OEM manufacturers follow a more traditional approach, by maintaining a hugeinventory of parts and assemblies. One advantage of doing so is that supply chain riskscan be minimized or eliminated, but this advantage is more often than not offset by highoverhead costs.

Other manufacturers rely on just-in-time shipments of parts to support the leaner in-house business or management practices and processes they have put in place. Thisis especially true of OEM manufacturers who focus more on assemblies and no longermanufacture their own parts.

While a just-in-time approach may reduce or eliminate the need for in-house partsinventories, inventory management systems still need to be in place. The problemis, these systems are often distributed among different suppliers, and maintaining overallinventory status in real-time can range from being a difficult task to an impossible one.

Outsourcing Inventory Management as a Solution

It only makes sense for parts suppliers to stock those parts and maintain andmanage their own inventories. This still leaves the ultimate customer with a need toeither find a way to integrate and manage multiple inventory systems or to consideroutsourcing the task.

When parts are being produced by a single outside supplier, there are many benefits tobe gained by outsourcing the inventory management task, especially when that supplierspecializes in inventory maintenance and management in addition to manufacturing.

Having inventories managed remotely yields savings in money, space, and manpower.This is particularly true for small businesses; since a company specializing in partsinventory management can be counted on to perform the task more effectively,efficiently, and often at a much lower cost than is possible in-house.

Like anything else, outsourcing can have its disadvantages; but by choosing the rightpartner, they can be minimalized to the point of becoming nonexistent.

How Inventory Management Works

Inventory management is a process by which parts are accounted for from the time theyare stored, until the time they are delivered or installed. The movement of parts must betracked, preferably in real-time, and the status of the number of parts remaining in stockmust also be tracked, in real-time or periodically, depending upon the need.

Tracking the movement of parts, or the status of parts in stock, can be prohibitivelyexpensive if done manually, and large numbers of parts and part types areinvolved. In addition, manual inventory management techniques usually fall far short inperformancewhen supporting just-in-time delivery processes.

Consequently, today’s inventory management systems are automated, software-based,and capable of operating without human intervention. These systems can be used tomanage the inventory of a single-source supplier, or multiple suppliers.

A typical example: Parts are stored in bins. Sensors are used to measure the weight ofeach bin (which is then converted to the number of its contents). The sensors can bemonitored on a weekly, daily, or even an hourly basis.

The sensors are hardwired (wireless is a much less expensive option) to a computer,which can be a PC or even a laptop. The PC, which contains proprietary inventorymanagement software and acts as a server, can then transmit real-time inventory statusto stakeholders, manufacturers, or suppliers.

The Advantages of Outsourcing Inventory Management

  • An automated inventory management system can highly supportive of JIT deliveries, even from a remote location.
  • In-house administrative costs associated with inventory management can be eliminated or substantially reduced.
  • Small businesses, in particular, can at times find it difficult to handle all aspects of their business processes internally; or find doing so to be too costly or inefficient.
  • A supplier that specializes in inventory management can perform the task at a lower cost; without compromising the quality of service.
  • 通过外包库存管理,支持process, a business can place a greater focus and emphasis on its core processes.
  • The inventory manager can take on some of the risks associated with keeping a supply chain fully functioning and intact, and those risks can be significantly lessened since the vendor has the background and expertise, and the management system software has the necessary functionality, to keep the part delivery process running smoothly; especially for just-in-time applications.

The bottom line: by outsourcing the inventory management process to where theexpertise and wherewithal lies, risk can be mitigated, productivity can be improved, andcosts can be lowered.


For further information about our inventory management services, contact us directly via the convenientwebsite formor request a formhere. We welcome your inquiries.

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From a contract manufacturing firm, BuntyLLC evolved into a full service custom machined, forged and cast metal parts fabrication enterprise. We supply global solutions from our headquarters in Greenville, South Carolina.

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