Wireless Warehouse Benefits
Updated: September 24, 2004
If a physical inventory count is right up alongside having teeth pulled on your list of least favorite things to do, then read on. The following article discusses how wireless communication can help improve the speed and accuracy of your inventory counts and cut costs.
Inventory counts are not only time-consuming, they are unreliable and expensive. Mistakes are made when counting quantities, and then more mistakes are made when keying in the information.
Replacing pen and paper with bar codes and scanners can bring a more efficient warehouse. And if the scanners update your system live without needing to be put in a docking station, then you're well on your way toward high levels of accuracy and efficiency.
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How Wireless Communication Works
As your personnel scan item and location bar codes with a hand-held device, a radio antenna transmits the information to your inventory system. You can scan each individual item, or scan one and then punch in the quantity on the scanners keypad. Wireless scanning has the following advantages:
| • | Much faster than a manual count |
| • | Reduces safety-stock levels because you have a better picture of stock on-hand |
| • | Eliminates the errors that occur when people type data into a system |
As one Microsoft Dynamics customer explained it, "We used to use pen and paper for our quarterly stock check and it would take 20 people two whole days. With barcodes and scanners, it now takes five people a couple of hours. That alone saves us around one employee a year."
Moving Toward the Continuous Count
The efficiency of bar coding and wireless communication means you can also count inventory more frequently, so it's possible to keep closer track on valuable or critical items. In fact, you can make inventory-counting part of the daily work of warehouse personnel. Whenever they add, pick, or move an item, they scan its bar code plus the bar code of the shelf or bin it is stored in. There's no need to employ casual labor for periodical counts and you get an accurate inventory count in real-time.
Why Wireless Increases Efficiency
Once you've implemented bar coding and wireless communication and you're confident that your system is accurate, you can give vendors and customers direct access to real-time inventory information.
Even if you're not ready for a sophisticated form of supply chain collaboration, wireless communications can have a positive effect on your entire organization. Lets look at an example where a shipping clerk picks the last items in a bin, first in a company without wireless communication and bar coding and then in a company with them.
Without wireless devices and bar coding, the clerk finds the items on a pick list and eventually enters them in the system (correctly, you hope). In the meantime, other clerks waste time making trips to the empty bin, the purchaser makes an order without taking into account that these items need to be replenished, and your phone staff can't give customers accurate information about the progress of orders involving these items. Inaccurate data is like a virus that spreads inefficient processes and acts as a base for poor decisions.
Armed with a wireless device, on the other hand, the system directs the clerk to the nearest items that need to be picked. The clerk scans the bar code on the item, gets immediate verification that it corresponds to the sales order, and the process is instantaneously recorded in the system. There are no trips to the empty bin. The purchaser knows which items need to be reordered, and customers get accurate delivery information. Wireless communication triggers a wave of efficiency.
Success Is Not Automatic
Like any other tool, wireless technology is only as effective as the people using it. It will not tell you how often and in what order to count your inventory. Nor will it organize your warehouse for you. On the contrary, your warehouse must first be organized in order to take advantage of it.
As inventory management expert Jon Schreibfeder puts it, "The savings realized from just the reduced labor cost often make physical inventory bar code implementations a worthwhile investment. But a word of caution, because bar codes are assigned to bins, all of your products must be located in their proper locations. Don't attempt a bar code physical inventory unless your warehouse is in order!"
