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The latest trend in all industries has been to outsource inventory management functions to Third Party Service providers. Companies outsource both Raw Material Inventory as well as Finished Goods to the Service Provider.
In case of finished goods inventory, depending upon the supply chain design, there may be multiple stocking points at national, regional and state levels. In such an event each of the warehouse a different service provider may manage operations, as one may not be able to find a supplier having operations all over the country.
Therefore the inventory in such a situation will be managed in the Company’s system as well as in the Service provider’s system. Inventory management and control becomes a critical function especially in such situations where multi locations and multiple service providers are involved.
To ensure Inventory control is maintained across all locations, following critical points if focused upon will help:
Especially in a 3rd Party Service Provider’s facility, it is important to have process adherence as well as defined management, authorization and escalation structure for operations failing which inventory operations will not be under control.
Daily stock count should be able to reflect location accuracy, stock accuracy as well as transaction summary for the day.
Inventory is nothing but money to the company. If 3PL vendor is managing the inventory, needless to say you should have your processes in place to be able to control and maintain inventory health.
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