Keys to Guarantee Stock Rotation in the Warehouse

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One of the key aspects that companies must ensure is warehouse management. For a business to function properly, it must be able to locate products quickly and efficiently. Products do not (or should not) remain in the warehouse forever, as they are a current asset that you need to sell to generate profitability. That is, there must be a good stock rotation ; Otherwise, you are wasting your warehouse with stored stock that is never sold and loses value over time. In this post we are going to give you the keys to ensure stock rotation , so that you can start to obtain benefits from the investment you have made in stock for your business. What is warehouse stock rotation? Stock rotation tells us the number of times it is necessary to replenish the inventory with new stock. If the inventory is not replenished with new stock, there is no good logistics management and what is known as a stockout would occur, that is, you do not have the products that have been purchased from you or that customers are demanding from you.

The rotation of merchandise in a warehouse can be measured through an indicator known as IR (Rotation Index), which shows us the number of times the stock has been replenished. When there is a good flow of goods and the products are sold, the company generates profits, but if the stock remains in the warehouse, that means space that you are wasting, in addition to a maintenance cost and an opportunity cost. How warehouse stock USA Phone Number List turnover is calculated Calculating stock turnover can be done very simply. First of all, you need to choose the time period for which the inventory turnover rate is going to be calculated, which is often one year, although it can also be calculated quarterly or monthly. Next, we must calculate the cost of all the products that have been sold during that year. Finally, we must divide the total cost by the average inventory, that is, the average number of products that have been in the warehouse during that period of time. This information is very easy to calculate, since you only have to add the initial and final inventory of said period and divide it by two.



Depending on the data you give us, we divide the total inventory costs by the average inventory and what is obtained is the inventory turnover rate. This data will give us a detailed view of our business's ability to rotate inventory, and we will be able to see that over a period of time, there have been times of higher or lower turnover rates, since there are times of the year when the one where there are more sales than others. To make these calculations, it is very important that your company has specialized ERP software. If you work in the furniture, rest or upholstery sector, you can use the SimGEST solution to plan your company's resources and carry out warehouse management efficiently.