how do you secure inventory

1. Lock and monitor inventory. This seems obvious, but it’s one of the most low-cost and effective methods to protect inventory.
2. Organize and label inventory. If you can’t find your inventory, you have less chance of controlling it. ...
3. Leave a paper trail. A good control system tracks and documents inventory movement through the production system, from raw material to finished product.
4. Conduct cycle counts on a regular basis. A full inventory can seem like a daunting task, so incorporate smaller cycle counts into your employees’ routines.
5. Spot check the inventory list. Ask your production manager or someone familiar with your stock to look over the inventory records periodically.
Review your bill of materials. Have any inputs to production changed over time? Perhaps an employee has found a way to make production more efficient.
Look for obsolete inventory. Is there anything collecting dust in your production area? Does it hold value to the company? ...
Minimize movement at year-end. Make sure your employees know when movement should stop at year-end and abide by the guidelines you’ve laid out.
Consider an inventory observation. Do this when you take a full physical inventory. ...
Set the tone. When employees see that accuracy and process are important to leadership and can impact how they can add value, chances are it’ll have a positive impact ...

How can I keep track of my inventory?

If you use an electronic inventory system, make sure you set up a secure username and password that only you know. If you use an excel spreadsheet to keep track of inventory, store the spreadsheet on a secure computer that only you have access to. Similarly, if you use a notebook, keep that notebook in a secure place.

How can manufacturers manage and protect inventory?

As a manufacturer, internal controls are essential to safeguard your most valuable asset – inventory. Consider these 10 tips to help manage and protect your inventory. 1. Lock and monitor inventory This seems obvious, but it’s one of the most low-cost and effective methods to protect inventory. 2. Organize and label inventory

How can I prevent my inventory from being stolen?

Establish inventory system controls. Whatever you use to record your inventory levels should be controlled to prevent anyone from wrongfully or accidentally changing your records. If you use an electronic inventory system, make sure you set up a secure username and password that only you know.

How do you control inventory in a business?

Establishing Inventory Controls Determine your inventory control needs. Separate your inventory from business activity. Restrict access to your inventory storage area. Record inventory usage. Perform inventory audits and cycle counts. Establish inventory system controls. Walk the talk.

What are the 5 steps to effective inventory system?

In short, you need a process that removes any constraints from resources, frees up capacity, and leads to accurate inventory levels. The process must include steps to plan, execute, measure, assess, and improve the system.

What are the 4 ways of achieving proper inventory control?

4 Effective Inventory Management TechniquesJust-In-Time. One of the most popular methods for inventory management is known as Just-in-Time (JIT) inventory control. ... Downloading Inventory Software. ... Stock Control. ... Reduce Carrying Costs.

What are the 3 major inventory control techniques?

The three most popular inventory management techniques are the push technique, the pull technique, and the just-in-time technique. These strategies offer businesses different pathways to meeting customer demand.

What are examples of safeguarding inventory?

Security alarms on doors and windows can alert local police authorities in the case of a break-in. Advanced locks on doors protecting storage areas can reduce incidents of internal theft as well as break-ins. Security cameras can record thefts in progress, helping to identify thieves for local authorities.

What are inventory control methods?

Inventory control involves various techniques for monitoring how stocks move in a warehouse. Four popular inventory control methods include ABC analysis; Last In, First Out (LIFO) and First In, First Out (FIFO); batch tracking; and safety stock.

What is the most effective method for controlling inventory?

5 most effective methods of inventory management1) ABC analysis. ABC analysis stands for Always Better Control Analysis. ... 2) Economic order quantity (EOQ) ... 3) FIFO and LIFO. ... 4) Fast, slow and non-moving (FSN) analysis. ... 5) Just in time (JIT) method. ... Conclusion.

What are the 4 types of inventory management?

The 4 Types of Inventory Management The types of inventory management are Raw Materials, Works-In-Process, Maintenance, Repair and Operations or MRO and Finished Goods.

What are the 4 types of inventory?

The four types of inventory most commonly used are Raw Materials, Work-In-Process (WIP), Finished Goods, and Maintenance, Repair, and Overhaul (MRO). You can practice better inventory control and smarter inventory management when you know the type of inventory you have.

What are 4 stock control methods?

What are the methods of stock control?Just-in-time (JIT)FIFO.Economic Order Quantity.Vendor-managed inventory.Batch control.

How do you safeguard an asset?

How do you protect assets?keep a record of all assets - see different types of business assets.carry out regular asset checks, including stock and inventory checks.carry out a risk assessment for different types of assets.restrict access to assets such as stock, cash or data, where appropriate.More items...

What are the control procedures used for safeguarding materials?

The seven internal control procedures are separation of duties, access controls, physical audits, standardized documentation, trial balances, periodic reconciliations, and approval authority.

Which of the following is a security measure's to safeguard inventory?

Some examples of security measures to safeguard inventory include what? -storing inventory in areas that are restricted to only authorized employees. -locking high-priced inventory in cabinets. -using two-way mirrors, cameras, security tags, and guards.

What is inventory security?

Inventory security is the process of ensuring the safety and optimum management control of stored goods. It is of central importance for optimum warehouse management because the performance of a company stands or falls with the safety and efficiency of a warehouse.

Which cost flow assumption assumes that the first units purchased are the first units sold?

The First-In, First-Out (FIFO) method assumes that the first unit making its way into inventory is sold first. FIFO is generally preferable in times of rising prices as the costs recorded are low, and income is higher.

How to keep track of inventory?

Manually update your inventory. Inventory management software can be a helpful way to keep track of your inventory since it automatically updates your inventory records as new sales and purchases are inputted into the software. It is important, however, to have a system of manually monitoring your inventory so you have a way to cross-check the accuracy of the software (or if you opt not to use any type of software).

How to improve inventory control?

1. Understand the goals of any inventory control system. An inventory control system should accomplish three key goals . Knowing these goals are helpful in letting you know if your current system is effective, if it can be improved, as well as how it can be improved.

What is an inventory control system?

Exactly! An inventory control system should accomplish 3 key goals: it should let you know what is in your inventory at all times, it should detect and update changes in your inventory, and it should let you know how much inventory to order and when to reorder.

What is the first step in inventory control?

The first step to inventory control is being deeply aware of how much inventory you have on hand at any given time, what type of inventory you have available, where the inventory is located, and how it changes over time. Today, there are plenty of software applications that can assist in this process.

What is a barcode tracking system?

If you have extensive amounts of inventory, look into a barcode tracking system. This will allow you to place a barcode on each item, which allows staff to quickly scan, identify, and transfer inventory information into whatever software you are using. This is an alternative to manual labels.

Why do you need a separate financial system?

You need a separate financial system to analyze your revenue and expenditures. Your inventory system should keep an accurate count of your products so that you know when and how much to order. Click on another answer to find the right one... To notify you when you need to reorder products.

How to store weekly checks?

Store the updated documents in an organized manner. Make sure to store your weekly checks (or whatever time period you chose) in neat folders or binders that are organized according to month. This way, if you need inventory data for a particular week, you can readily find it. It is also helpful in case your accountant needs any information.

How to store valuable inventory?

Store valuable inventory or tools in security cages: Lockable security cages are relatively inexpensive and can be built to work in most any space. Rows of shelving or racks can be segmented away into secure areas, where only authorized personnel can travel. You can even designate card reader locks and other measures that help you identify who was in or out of the secure areas .

How to store inventory in modular storage?

Utilize modular storage: If your inventory is typically stored in shelving or racks, you can add lockable modular storage drawers to segment particularly valuable items. Many times, these systems are used to segment smaller, more valuable components from bin storage areas.

What are some examples of valued, concealable, desirable inventory?

A good example of valued, concealable, desirable inventory is tobacco products in a grocery distribution center. Cigarettes are small, easy to hide, and easy to move. They are a high-priority target, so they should be secured differently than, say, bags of dog food or cases of paper towels — things that aren’t that expensive, not as desirable, and not as easy to hide, transport or sell.

What are the most valuable items in grocery distribution?

High-value foods – in grocery distribution, tobacco tends to be the top target, but other valuable or desirable foods are always a target. Jewelry – compact, easy to conceal and typically very valuable. Firearms or ammunition – prices on guns and ammunition are always high, and many times inventories are low.

How to restrict access to storage zones?

Lay out storage zones for access control: You can restrict zones by laying them out so they aren’t in main traffic ways and have limited egress points. If you have a higher value area, don’t place it in the center of your warehouse where everyone has access.

Is security impossible in warehouses?

In fact, security is impossible when people who should not be in an area have easy access to it. In a warehouse environment, that’s sometimes difficult due to the fact that so many order pickers, forklift drivers, management personnel, visitors and others need access at various times. But you can control it at least to some degree.

Can a 100 pound component be stolen?

First, let’s talk about what gets pilfered. While a 100-pound component can be stolen, it’s usually smaller items . We lay that out in our warehouse security white paper:

How to keep inventory accurate?

1. Choose an inventory monitoring method. The key to maintaining accurate inventory is having an established method of inventory tracking, and sticking to the method faithfully. There are generally two options for inventory tracking — system or manual.

How to maintain accurate inventory records?

To maintain accurate inventory records, you'll need to add new inventory when you make purchases and reduce inventory when you make sales. If you are using an electronic inventory system, you will likely have the option of connecting your system to your cash register, and using continuous inventory recording.

Why are inventory controls less stringent?

If your inventory is food, beverage, or other low-cost items , your controls can be less stringent because your inventory isn't as risky. Remember that it is possible to over-control your inventory — the more complex your controls are, the higher the cost of labor associated with performing them will be.

Why is it important to store inventory in a separate place?

By storing your inventory in a separate place from where you do business, you ensure that it isn't readily available or visible at all times. For example, you may have a large fridge and freezer in the back part of your coffee shop, and employees may bring milk from that fridge to the bar when they need to.

What is it called when you lose inventory due to theft?

Loss of inventory due to theft, damage, defect, etc. is called shrinkage, and you should aim to minimize shrinkage while still allowing for reasonable error.

How to create an inventory group?

Create inventory groups and tags. Make a list of all the products or types of products you have in your inventory, and choose a name for each one. You can be as detailed as you would like, but each item in your inventory should fit into one (and only one) of these inventory groups. Include any inventory items you will need in the future or simply don't have on hand on inventory day, and create groups for those items as well.

Why do you count inventory twice?

If your inventory is especially valuable, complex, or dangerous, you might count it twice to ensure accuracy. You may need to involve your employees if you have a large business and a lot of inventory. Physical inventory counts should be performed regularly to validate automated inventory counts.

Why is inventory shrinking?

It can be tough to know if inventory “shrink” is because of waste, breakage or theft. The first thing you should do is make sure your staff are required ...

What to do if you have a physical store?

1. If you have a physical store, your inventory management efforts will need to include efforts to prevent shoplifting. If you notice that shoplifting is a problem, you may want to install security cameras and educate your employees about loss prevention and in-store inventory control.

How to prevent employee theft?

2. Make sure your employees know that you are carefully keeping track of your inventory with highly efficient inventory management techniques. Employee theft is far less likely if inventory systems are well-run and organized. 3. Only allow trained and trusted employees to edit data in your inventory management software.

Can you change the number in inventory software?

It’s easy to change a few numbers in the inventory software so no one realizes products are gone. Many software systems require a unique logon and therefore updates to inventory can be tracked by user. Make sure employees do not share user ID or passwords.

Do you have to worry about inventory theft?

If you are using the right inventory management techniques, there’s no need to worry about inventory theft. Just arm yourself with a highly organized inventory management system!