While seemingly a simple procedure, the way you receive your orders into your warehouse can have significant impacts on your warehouse staff, your inventory tracking and your finances. By looking at receiving as a step in your procurement process rather than as a process onto itself, you will set yourself up for success. A good operations management software will allow you to create an efficient workflow by having the right information flow to the right stakeholder at the right time, instead of treating each process as a separate entity.
Using a good operations management software, your purchasing department will generate a Purchase Order, which results in the automatic creation of a receiving document. This lets your warehouse know what inventory to expect to receive. If the vendor ships incorrect items or incorrect quantities of items, your warehouse staff will be immediately aware of this and will have the opportunity to reject the inappropriate products. Once receiving your order, a vendor bill is automatically generated based on what was actually received, NOT based on what the vendor says you were supposed to receive. Let’s take a closer look at some of the benefits that come out of this work flow.
- Schedule Your Warehouse Staff
By initiating every purchase order using your software system, you can easily set your warehouse staff’s expectations for which orders they should expect to receive each day. If you know in advance that you have a higher than normal volume of orders arriving, you can make sure to allocate the right resources to handle the volume. Knowing that you have a large volume of orders arriving can also help you plan for any additional receiving space required for that days orders. On slow days, you can redeploy some of your staff to other tasks instead of having them sit idle.
- Receive Only What You Order
Vendors do make mistakes sometimes, so it’s important to catch those mistakes as quickly as possible. By receiving against your purchase order, you can verify that you are receiving what you actually ordered, instead of receiving what the vendor sent you. If you are short shipped or over shipped, you will know right away.
- Pay Only For what You Receive
Once you have accurately received your order, your software should generate a vendor bill for you. You can then pay your vendor according to your vendor bill which is based off of inventory actually received, instead of paying for what the vendor says you received. The end result is accurate inventory, and only paying for what you have actually received.
By using a software system that keeps the big picture of your organization in mind, you will set yourself up for success. If you would like to learn more about business operations management contact us at email@example.com or call 1-800-970-9071 and ask for Darryl.