Inventory Management in Practice : Illuminate has best-practice Inventory Management built-in. It uses the ‘Safety and Review’ stock level model to ensure that you carry appropriate levels of stock – not too much (ties up too much of your hard-earned capital and warehouse space), not too little (customers will get annoyed if they can’t get their products quickly).
The safety and review levels are calculated by the system using statistical methods for demand-forecasting, and vary according to the sell-rate of the product, the supplier lead-time and the customer service % factor (i.e. the percentage of orders that will always be able to be fulfilled immediately from stock – usually 90% or higher is recommended).
Review Stock Level – When stock reaches this level, a decision should be made as whether to purchase the stock. Current demand and supplier lead times will dictate on whether to order at this point.
Safety Stock Level – The absolute minimum amount that you should hold, so that the customer service factor % can be maintained.
Safety and Review levels are re-calculated continuously and are built into Illuminate’s Purchase Order (PO) module. S&R levels can also be reviewed on a system wide basis from the Safety and Review module.
We recommend integrating Safety and Review into your daily routine, and reviewing it as appropriate throughout the day so that your supplier orders are never out of date. Exception and management reports are also available so that you can review performance on a daily, weekly or monthly basis.
Further reports on goods inwards, pick, pack and ship rates, stock loss are all available from within the reports module.