In an industrial warehouse setup, inventory shrinkage is quite common and needs prudent measures to address this challenge. Inventory shrinkage refers to the loss of products between the point of manufacture to the point of sale. This could be due to various factors like theft, administrative discrepancies, supplier fraud, and damage. According to a National Retail Federation report, inventory shrinkage costs U.S. retailers about $61.7 billion annually. To combat this issue effectively, many businesses are exploring mobile warehouse management solutions (WMS) that is integrated with their Enterprise Resource Planning (ERP) systems. This blog will explore how Oracle’s mobile ERP WMS can specifically address and reduce inventory shrinkage.

Overview:

Understanding Inventory Shrinkage

As mentioned above, inventory shrinkage is primarily due to the following factors:

Theft: This is the most common concern of warehouses, which needs to be curbed at the earliest. This can again be of two types: External (shoplifting) and internal (employee theft).
Errors: Errors occur due to adoption of mostly manual, paper-based processes by an organization’s warehouse personnel. Errors can be of different types: administrative, scanning or misplacement.
Supplier Fraud: This can happen inadvertently in most of the cases when vendors deliver fewer items than invoiced.
Damage: In certain circumstances, when warehouse personnel or dispatch clerks handle the material carelessly, the products may get damaged. Apart from that, material damage could also happen when products are stored or transported from one place to another.

Warehouses that already have a good ERP system in place can mitigate few of these challenges, though a centralized ERP system may not completely solve the purpose. This is due to the fact that warehouse personnel who are mostly located in far-flung places with limited internet connectivity cannot access the ERP data that an organization’s backend personnel and managers have access to. This leads to poor visibility into the real-time inventory status, and a complete disconnect between the frontline workforce and backend personnel. To successfully bridge this gap, a mobile WMS application that integrates with an organization’s ERP system like Oracle can be a perfect solution for successfully managing inventory shrinkage challenges.

Propel Apps’ Mobile Warehouse Management Solution

Propel Apps, a leading digital transformation company has developed a mobile WMS solution that streamlines complex supply chain processes for Oracle EBS and Oracle Cloud, while successfully mitigating the challenges related to the inventory shrinkage. This solution offers real-time visibility and control over inventory, from receiving goods to their final dispatch. Here’s how the Propel Apps’ Oracle’s WMS solution helps mitigate inventory shrinkage:

1. Real-Time Inventory Tracking

One of the significant advantages of Propel Apps’ WMS solution is real-time inventory tracking. By leveraging the power of barcode and RFID scanning, warehouse personnel can easily scan the inventory, and update the records instantly. This minimizes administrative errors and ensures accurate inventory counts, reducing the chances of shrinkage due to miscounting or misplaced items.

2. Enhanced Visibility and Transparency

Propel Apps’ WMS solution provide end-to-end visibility of inventory levels and movements. Using this app, warehouse workers can track products from the moment they enter the warehouse until they leave. This visibility helps in identifying shrinkage sources promptly. Any discrepancies between the recorded and actual inventory can be quickly addressed, and patterns of loss can be detected and rectified.

3. Accurate Stock Audits

Regular audits are crucial for detecting and preventing inventory shrinkage. With Propel Apps’ WMS solution, an organization can simplify the audit process. Instead of manual counts, which are prone to errors, this solution can quickly scan inventory, compare it against the recorded data, and highlight discrepancies. Another good feature is cycle counting, ensuring that stock audits are accurate and less time-consuming.

5. Efficient Handling of Returns and Damages

Managing returns and damaged goods effectively can significantly reduce shrinkage. With this solution, a warehouse can streamline the returns process, ensuring that returned items are correctly logged and restocked or discarded. Furthermore, this solution also has a feature for handling returns efficiently, ensuring that damaged goods are accounted for and do not contribute to inventory shrinkage.

6. Vendor Management

Supplier fraud can be a hidden source of inventory shrinkage. By scanning and verifying each shipment against purchase orders in real-time, discrepancies can be caught immediately. With inbound processing capability incorporated in this solution, warehouse personnel can easily verify the accuracy of incoming shipments, ensuring suppliers deliver as per the contract.

Apart from the above benefits, this solution also ensures high level data confidentiality and security, flexibility to customization and offline support. To know more about this solution, schedule a call with us and we will be ready to help you.