Cost optimization is the eternal theme of enterprise management. Good logistics cost management can save enterprise costs by improving inventory turnover, speeding up capital turnover, reducing operating costs and improving customer service level, thus ultimately increasing enterprise profits.
Contents of inventory cost control
The first problem of successfully managing inventory and reasonably controlling its cost is to have a correct and comprehensive understanding of inventory and its cost composition. Because of the concealment of inventory cost, managers generally have a one-sided understanding of it and often ignore some important aspects. If we do not consider the cost of inventory materials in the warehouse, we will not consider the impact of inventory materials on the company's capital turnover.
The composition of inventory cost can generally be divided into the following three main parts: inventory holding cost; Inventory purchase cost; Inventory shortage cost.
Corresponding to the composition of inventory cost, inventory control strategy can be divided into the following three levels.
Inventory decision: control inventory holding cost. Managers decide what products need to be stocked and what products don't need to be stocked through quantitative analysis of materials; And the scale, turnover rate and distribution of all kinds of product inventory, so as to finally control the inventory holding cost.
Determine the ordering method of inventory: control the purchase cost of inventory. Managers can finally control the inventory holding cost by determining the reorder point, ordering cycle and quantity of each order. If the purchasing point is in Italy, the purchasing batch can be controlled once a month.
Demand forecast: control the cost of inventory shortage. An important content of inventory management is to obtain relatively accurate demand forecast, including production plan and sales plan.
In the actual management work, besides determining the correct inventory management mode according to the product characteristics of enterprises, it is more important to treat the identified inventory products differently, treat them differently and classify them, which is usually called ABC classification.
ABC classification is to classify inventory materials according to the size of occupied funds and the proportion of sales. Materials with a larger proportion of sales are classified as Class A, materials with a lower proportion are classified as Class B, and materials with the lowest proportion are classified as Class C ... The purpose of this classification method is mainly to
In order to strictly control key materials, reduce the inventory level of enterprises on the basis of improving the overall delivery level of enterprises, and take proper care of general materials.
In the setting of safety inventory, it is necessary to distinguish which materials can be purchased and ordered in time, which materials have a long procurement and ordering cycle, and even can achieve zero inventory; For purchasing items with long ordering time, the safety stock can be set higher. In addition, the setting of safety stock,
It is also related to customer needs and their changes. As for the inventory control strategy, it also needs to be selected according to the type, quantity, scale and supply-demand relationship of materials. For example, the market is well supplied and can be ordered at any time, with many varieties and great value.
Low-priced goods generally choose quantitative ordering. For less variety and more serious materials, regular ordering is generally adopted. The above ordering strategy is aimed at items with independent demand. If it is an associated demand, MRP procurement needs to be realized.
Specific measures of inventory cost control
Reduce useless inventory. Although inventory must exist in many cases, not all inventory can play its role to meet the needs of production or delivery, or these inventories can not be used for a certain period of time. Therefore, an important aspect of reducing inventory cost is to reduce the number of these unusable inventories as much as possible.
For enterprises, in-transit inventory, sluggish inventory, reserve inventory (deliverable orders cannot be delivered for other reasons), work in process or goods to be inspected are all unavailable inventory. One of the goals of inventory management is to improve the ratio of available inventory to total inventory.
For customers, the order of batch delivery can greatly reduce their inventory level, but for suppliers, this is a great pressure, so enterprises must strictly control such orders. Only when it is really necessary can we provide customers with the service of bulk delivery. Moreover, it is necessary to regularly check the reserved inventory, strengthen communication with the sales department, finance department and customers, and eliminate the reserved inventory caused by payment, customer project delay and other reasons as soon as possible.
Choosing a good supplier is very important for enterprises. If the dull inventory can be reprocessed to improve sales opportunities, cooperation with suppliers is also a better means to reprocess the dull inventory. However, if the supplier's materials always have similar quality problems, so that Company A can't predict the available inventory and normal production, it should consider changing suppliers.
It is also very important to adopt an appropriate accounting method for inventory lending for inventory control. Among them, PMC (Production Material Control System) plays a connecting role in the whole production. We should not only keep track of materials at any time, but also clearly judge which materials are about to be out of stock and respond to them immediately. The positive and effective measures taken by PMC will greatly improve the management efficiency of enterprises. Generally speaking, the means of PMC control usually include the following three points: controlling quantity to meet the demand of production; Control progress to meet the demand of production cycle: control variance compensation to meet the demand of write-off and closure.
According to the inventory ordering system, PMC first needs to solve the problems of when to replenish and how much to replenish at a time. The correct inventory replenishment method can greatly reduce the safety inventory, which is very important for the control of the overall inventory level. There are usually two ways to consider when to replenish different materials: the first is to replenish when the inventory of a certain material reaches a preset level; The second dynamic replenishment method has higher requirements for managers. By balancing the existing inventory and the demand forecast quantity in a certain period in the future, it is decided whether to generate a purchase order for replenishment at present.
Enterprises can decide different replenishment methods according to the importance of inventory materials: usually, Class C inventory materials adopt quantitative replenishment methods; Class A materials are supplemented dynamically. This management mode enables enterprises to devote most of their time and energy to the management of important materials, which has played a significant role in improving the delivery rate of orders and reducing inventory. In addition, controlling the purchase quantity is an important means to reduce inventory.
Several aspects that should be paid attention to in the process of inventory cost control
Although the control of inventory cost has a vital impact on the overall operation of enterprises. However, simply and blindly emphasizing the control and reduction of inventory cost can not only bring positive effects to enterprises, but even have negative effects. Therefore, in specific work, we need to pay attention to two preconditions of inventory cost control: service level and total logistics cost.
Cost and service are relative restrictive factors: the better the service, the higher the cost; Or vice versa, at any time from Dallas to the auditorium, cost management can not be separated from the requirements of service level, and cost reduction is pursued alone.
The current market is a buyer's market, and the competition in various industries is very fierce. For enterprises, the first thing to consider is the sales volume and market share of products. Among the four elements (product quality, product price, delivery, service and marketing) as the core competitiveness of enterprises, with the progress of science and technology and the transparent and rapid dissemination of information, the difference between product quality and price of different enterprises in the same industry is getting smaller and smaller, and customers increasingly take the delivery time and service level of enterprises as reference factors for measurement and selection. As soft management content, the delivery and service of enterprises are difficult to be imitated by other competitors in a short time.
Therefore, the primary task of an enterprise is to formulate a reasonable service level. This service level should not only meet the overall situation of the industry and customer expectations, but also control the cost of enterprises; It should be slightly higher than the main competitors of enterprises in order to maintain the competitiveness of enterprises and expand market share; Under the premise of meeting this service level, enterprises need to optimize internal management, especially cost control, to reduce their operating costs, improve their profit margins and create conditions for enterprises to improve their service level in the next step.
Inventory cost is only one aspect of total logistics cost, and total logistics cost refers to the overall cost of logistics from input to output. The purpose of logistics total cost optimization is to eliminate unilateral optimization, such as simply reducing storage costs, reducing inventory costs and optimizing transportation costs. Therefore, the control of inventory cost should balance the management of various logistics operation functions on the premise of pursuing the lowest total logistics cost.