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How Can Lean Inventory Management Help A Business to Grow?

Managing a company is no easy task. Inventory management is one area of business that can keep even small business owners up at night. Take, for example, the management of hospital inventory. If you don’t keep track of all your inventory, you run the risk of your institution being poorly managed. Fortunately, thanks to technological advances, inventory management, and control software have evolved greatly. Today, you find that effective Medical Inventory Management Software has the ability to help hospitals keep track of their inventory. For one thing, the hospital administration has all the information about its inventory. Nothing can be more fulfilling than knowing where all your inventory is.

Inventory management software can also enable you to account for where each item of inventory is located, how much inventory you have in your warehouse, and even who uses certain items in your organization. In addition, inventory management provides the company with many other benefits.

But now that you have the best inventory software for your business, how do you use it? Well, in this case, the bottom line is that you’re only as good as your tools mean something. Inventory management software and systems help your business reduce losses. And here’s how you can do it.

What is Lean Inventory Management (LIM)?

lean inventory management techniques

As already mentioned, inventory management serves to make your warehouse work easier and more efficient. Lean inventory management also does exactly what it sounds like it does. Lean inventory management reduces excess stock and limits itself to the essentials. In this way, you are basically trying to eliminate everything in your warehouse that you do not need. At the same time, the system works in such a way that only the essential products and other items are present in your inventory.

By reducing the amount of your stock at any time, you also save space and labor costs. You will also sufficiently reduce the time and effort you spend managing your inventory.

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Lean Inventory Management Techniques

Most lean inventory management systems are based on several principles. These principles can then be divided into 4 different areas. Mainly:

  1. Process
  2. Philosophy
  3. Problem-solving
  4. People and partner

1. The Process

  • The pull system approach

Lean inventory management uses a pull system. In this lean inventory management system, the stock is only moved when a customer places an order. The just-in-time (JIT) technique is an excellent example of the pull system approach.

JIT serves to reduce the total safety stock of your company to a minimum. If possible, JIT even works to eliminate your safety stock completely. In this way, JIT aims to order just enough stock to meet your customers’ requirements. This approach involves many risks. On the other hand, it dramatically reduces the cost of maintaining and caring for a stock that you do not really need.

  • Your staff workload level

Lean inventory management also helps to reduce the excessive workload on staff. You also want to ensure that all your employees are equally involved in inventory and business workload. If this is done, your employees will work more efficiently and also reduce the risk of human error.

  • Using accurate inventory control software
lean inventory management techniques

Modern inventory management software works to make the work of your employees more efficient without necessarily having to replace them completely. In this case, you want to choose an inventory system that also offers mobile inventory and sales forecasting app capabilities.

2. The Philosophy

It is important that you also respect the long-term philosophy of your company. You can achieve this by ensuring that every decision you make reflects the long-term vision of your company. Never abandon the long-term vision of your company, even if this means that you will have to accept some short-term losses and blows along the way. Medical inventory management software, for example, works perfectly to ensure that this becomes a reality when properly implemented.

Never lose the vision of your business for a few short-term losses. This will only prevent you from successfully implementing all your principles.

Identify activities that add value to your business.

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Excess and useless inventory is one of the factors that you need to identify and deal with early on. So make sure that you evaluate all your business activities and deal only with the activities that add value. Then you can eliminate the non-value-adding activities. Recognizing that there is a problem with your inventory or the way it is managed is the first step in changing your approach.

3. Problem Solving

Here you need to work on identifying the problems yourself and how they are damaging your business. The moment you realize that your company’s existence has a serious problem, it is up to you to take matters into your own hands and investigate the cause of the problem. Once you have found it, you can then work out the best way to solve the problem. As a business owner, you also want to constantly strive to improve your business.

Lean Inventory Management works to provide you with the best and most up-to-date inventory management software that makes inventory management a breeze. Always work towards building the processes of your business. Slowly but surely you will see some improvements in the way your business works.

4. People and partners

Last but not least, you also want to strive for good relationships with your suppliers. This is an incredibly important step, regardless of whether you intend to introduce lean inventory management or not. But it also depends more on the pull system, because your suppliers’ orders are more dependent on sales orders. So you will always depend on deliveries arriving quickly, reliably and consistently.

Final thoughts

Achieving lean inventory management in your business is not as difficult as some business owners believe. You don’t even have to have a brilliant mind to make it happen. As long as you have a great team working in the background to make sure everything runs smoothly, you’re ready to go. Always make sure you’re ahead of any inventory management information so that you have things under control if something goes wrong.

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