As technology has advanced, so have inventory systems used for stocking, processing, and other functions. In this article, we will discuss some major advances in inventory systems and the industries that serve as the driving force for this progress.
Advances in Data Systems
Advances in computer systems have allowed us to use perpetual inventory systems, with changes to inventory and cost-of-sale (COS) calculations. Even stocking is being handled in real-time by computers.
Perpetual inventory systems are far superior to periodic inventory systems, which rely upon an occasional, physical account of inventory. Perpetual inventory systems continually update the ledger or inventory journal as transactions occur, keeping up with the sales in real-time. Because there are thousands of transactions, perpetual inventory systems are all done using advanced computer technology, and it is easier to conduct transaction investigations because the data is so thorough.
Perpetual inventory systems change the way in which we make inventory and cost-of-sale (COS) calculations. There are continual updates to the amount of goods sold when a perpetual inventory system is used, and cycle counting, an auditing procedure in which a small subset of inventory is counted at a specific time, is made possible through the use of this system. Inventory purchases are recorded, depending on the type of good, in the raw materials inventory count or in the merchandise count, and there is also a unit-count entry that used for each inventory item, allowing for a full accounting of all materials that move in and out of inventory.
Advances in Robotics
With the advanced speed we use now to track and record our sales and inventory, there needs to be a counterpart to that and, through advances in robotics, that counterpart has been created. Robots have given us the degree of physical automation we need in order to move at the same speed as our sale-tracking moves. Using advances in robotics, warehousing has been modernized. Major retailers such as Target, Coca-Cola, and Walmart are using autonomous robots to warehouse their products. The robots move through the warehouse, coordinating with other robots that are performing similar tasks. This is an upgrade from prior robots that worked in warehouses under a less autonomous route. Other warehouse automation systems fix down their robots and have them move on track; with this upgrade, autonomous robots are showing a more sophisticated, streamlined side to warehouse robotics.
Fulfillment Models: Just-In-Time
Just-in-time inventory (JIT) is a strategy used to prevent waste and increase efficiency. This inventory system receives goods only when they are needed during the production process (AKA arriving “Just in Time” to be used), and no sooner. This way, there are no extra piles of unused materials that become waste. Manufacturers and companies who use JIT keep low inventory levels with a lightning-speed supply chain that provides the materials needed when the demand calls for them. This inventory control comes with an advance in technology, as systems become more intuitive and able to calculate the inventory needed to fulfill the orders. JIT is a fulfillment model that manages inventory in relation to demand, but does so in such a precise way as to reduce waste and increase efficiency.
Storage Models and Carousels
Storage models are becoming more computer-controlled and, in the case of larger companies, more robot-controlled. Automated storage and retrieval systems (ASRS) automatically place and retrieve items from a warehouse. ASRS systems benefit warehouses where there is a high quantity of inventory, as well as a high density warehouse. ASRS is computer-controlled, and in the case of companies such as Amazon, uses robots to retrieve the inventory necessary, minimizing damage to the product by removing “human error” from the equation.
Advancements in computers and robotics have greatly impacted the way warehouses are constructed, as well as the way inventory is calculated. As robotics and computer science continues to make great leaps, as will storage and warehousing.