Accounting expiration dates in warehouses. Variants of implementations
Currently, in almost every warehouse you can find products that have expiration dates. Of course, this is especially true for pharmaceuticals, food, but in other areas we can also find similar examples. In building materials there are paints, dry mixes, in warehouses storing spare parts these are various oils, sealants, other liquids. How do companies solve the issue of accounting for such goods?
1. Shelf life is not considered at all. This option is the easiest and does not involve automation and accounting for storage locations. At the same time, the storekeepers are given an oral recommendation on the selection of positions that has a residual shelf life as low as possible. The problems caused by such a solution are obvious. After some time, the remnants accumulate expired goods, which have to be written off and disposed of.
However, such a decision may be justified in the case when:
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1.1. The turnover of this nomenclature position is at least 5 times more than its shelf life.
1.2. The goods are not stored in racks and access to the storekeeper is provided access to any storage cell.
2. Accounting for shelf life on paper cards. The information system does not include expiration dates. However, storekeepers record information on the remaining shelf life at each storage location. As a rule, this is marked with a marker on the packages, or a corresponding tag.
This option gives an increase in speed in the selection of goods compared with the first, but it has several disadvantages:
2.1. Labor costs for the placement of goods are increasing.
2.2. An organizational restriction is imposed on the placement of goods with different expiration dates in one cell. It is not possible to optimize the use of storage space.
2.3. In case of violation by the storekeepers of the rules for placing goods, control by the information system is impossible. In this case, all the advantages of taking into account this information are lost, moreover, unreliable information ultimately even slows down the selection work!
3. Selection of the goods having expiration dates on FIFO. The main idea of this option - the selection of goods is carried out in the same sequence as its receipt (FIFO - First In First Out, first came - first left). In this case, the expiration dates for the goods in the system are not maintained, which greatly simplifies the processing of the goods, in contrast to the full account of the expiration dates. Along with this, this option can significantly reduce the likelihood of the stock of residual goods with an expired shelf life.
However, it is worth noting that this option implies a significantly higher level of warehouse automation, namely:
3.1. Storage cells in stock should be marked.
3.2. In the information system, the product must be listed in the context of cells.
3.3. Placement of goods in cells. Either the system should recommend the placement, or according to the results of the placement of goods, in the accounting system should be recorded the address of the placement of products.
In practice, this option is quite feasible for products that have a shelf life of six months.
4. Full accounting of shelf life on stock. Work on FEFO (First end - first out goes first product, which expires before), or BBD (Best before date - shipment, taking into account the shelf life). This option, of course, is one of the most time-consuming in terms of accounting, however, brings the best result. For this option in stock, you need to implement a WMS system.
If the technology of work in the warehouse is observed, the likelihood of overdue balances tends to zero. Of course, we cannot exclude the situation that such a product may simply not be sold, however, the information system will be able to warn in advance about the upcoming problems and the sales department, using its tools for motivating customers (sales, promotions, etc.) will stimulate the need for such nomenclature positions.
It should be noted that this functionality is quite difficult to implement. However, the greatest difficulties in the implementation of such a scheme of work will be associated precisely with the organizational component of the implementation. Such a process requires a complete revision of paradigms in stock. I would also like to note that such implementation in the accounting (or ERP) system significantly complicates the processes of all participants.
In this case, a reasonable compromise is the integration of accounting and WMS systems with the following details:
4.1. Accounting (ERP) system operates with balances and reserves. Sales managers reserve positions based on total balances. If necessary, they can obtain information on the remaining shelf life of the warehouse stocks.
4.2. The WMS system operates with residues in terms of shelf life and storage cells. At the entrance, she receives applications for shipment and ships the positions according to the work technology installed in the warehouse.
This article did not address such an important point as the control of the residual shelf life during acceptance and shipment (Often, contracts with suppliers and customers specify the minimum percentage of residual shelf life at which goods can be taken to stock or shipped to the customer. Often situations when the same customer needs to ship goods with different minimum residual shelf life, depending on the distance of the unit where the goods are sent. This problem will be described in Noah of the following articles.
Brief features of accounting types are given in the following table:
1. Shelf life is not considered at all. This option is the easiest and does not involve automation and accounting for storage locations. At the same time, the storekeepers are given an oral recommendation on the selection of positions that has a residual shelf life as low as possible. The problems caused by such a solution are obvious. After some time, the remnants accumulate expired goods, which have to be written off and disposed of.
However, such a decision may be justified in the case when:
')
1.1. The turnover of this nomenclature position is at least 5 times more than its shelf life.
1.2. The goods are not stored in racks and access to the storekeeper is provided access to any storage cell.
2. Accounting for shelf life on paper cards. The information system does not include expiration dates. However, storekeepers record information on the remaining shelf life at each storage location. As a rule, this is marked with a marker on the packages, or a corresponding tag.
This option gives an increase in speed in the selection of goods compared with the first, but it has several disadvantages:
2.1. Labor costs for the placement of goods are increasing.
2.2. An organizational restriction is imposed on the placement of goods with different expiration dates in one cell. It is not possible to optimize the use of storage space.
2.3. In case of violation by the storekeepers of the rules for placing goods, control by the information system is impossible. In this case, all the advantages of taking into account this information are lost, moreover, unreliable information ultimately even slows down the selection work!
3. Selection of the goods having expiration dates on FIFO. The main idea of this option - the selection of goods is carried out in the same sequence as its receipt (FIFO - First In First Out, first came - first left). In this case, the expiration dates for the goods in the system are not maintained, which greatly simplifies the processing of the goods, in contrast to the full account of the expiration dates. Along with this, this option can significantly reduce the likelihood of the stock of residual goods with an expired shelf life.
However, it is worth noting that this option implies a significantly higher level of warehouse automation, namely:
3.1. Storage cells in stock should be marked.
3.2. In the information system, the product must be listed in the context of cells.
3.3. Placement of goods in cells. Either the system should recommend the placement, or according to the results of the placement of goods, in the accounting system should be recorded the address of the placement of products.
In practice, this option is quite feasible for products that have a shelf life of six months.
4. Full accounting of shelf life on stock. Work on FEFO (First end - first out goes first product, which expires before), or BBD (Best before date - shipment, taking into account the shelf life). This option, of course, is one of the most time-consuming in terms of accounting, however, brings the best result. For this option in stock, you need to implement a WMS system.
If the technology of work in the warehouse is observed, the likelihood of overdue balances tends to zero. Of course, we cannot exclude the situation that such a product may simply not be sold, however, the information system will be able to warn in advance about the upcoming problems and the sales department, using its tools for motivating customers (sales, promotions, etc.) will stimulate the need for such nomenclature positions.
It should be noted that this functionality is quite difficult to implement. However, the greatest difficulties in the implementation of such a scheme of work will be associated precisely with the organizational component of the implementation. Such a process requires a complete revision of paradigms in stock. I would also like to note that such implementation in the accounting (or ERP) system significantly complicates the processes of all participants.
In this case, a reasonable compromise is the integration of accounting and WMS systems with the following details:
4.1. Accounting (ERP) system operates with balances and reserves. Sales managers reserve positions based on total balances. If necessary, they can obtain information on the remaining shelf life of the warehouse stocks.
4.2. The WMS system operates with residues in terms of shelf life and storage cells. At the entrance, she receives applications for shipment and ships the positions according to the work technology installed in the warehouse.
This article did not address such an important point as the control of the residual shelf life during acceptance and shipment (Often, contracts with suppliers and customers specify the minimum percentage of residual shelf life at which goods can be taken to stock or shipped to the customer. Often situations when the same customer needs to ship goods with different minimum residual shelf life, depending on the distance of the unit where the goods are sent. This problem will be described in Noah of the following articles.
Brief features of accounting types are given in the following table:
| Accounting type | Type of information system | Advantages of the solution | Solution minuses | Conditions under which the option is most optimal |
|---|---|---|---|---|
| Shelf life is not recorded | Missing | Ease of use | High probability of overdue balances in warehouses. There is no data on residues in terms of shelf life. | The shelf life of a position is more than 5 times turnover. Floor storage. Stuffed racks Storekeepers have very low qualifications. The accounting system in the company is missing, or provides a minimum of business processes of the company. IT department of the company is absent, or, if necessary, an employee is outsourced. |
| Accounting for expiry dates on paper cards | Accounting system | Ease of use. Ability to prevent expiration dates. | The complication of processes in stock. The need for frequent inventories. There is no possibility to optimize the routes of selection of positions. Finding a position with the required expiration date may delay the selection process. | The shelf life of a position is more than 3-5 times the turnover. Much of the position is stored outdoor. There are no printed racks. Storekeepers have an average qualification and above. The accounting system in the company is missing, or provides a minimum of business processes of the company. IT department of the company is absent, or, if necessary, an employee is outsourced. |
| FIFO Product Control | Perhaps in the accounting system, however, a WMS based solution is recommended. | There is no need to make an expiration date for acceptance of the goods. Minimum overdue balances. Work with the goods having expiration dates does not differ from work with other goods. There is an opportunity to build optimal product selection routes. | There is no data on the real shelf life in the system. There may be situations where later batches that have arrived at the warehouse have a shorter shelf life. Such situations are not handled. | The variant is used, as a rule, for working with dry mixes used in construction. Their shelf life is from 0.5 year, which practically excludes the situation with overdue balances. |
| FEFO Leakage Control | Expiration dates are maintained in the WMS system. | Maximum control over expiry dates. | More complex way of accounting in stock. Tough discipline storekeepers when working with the goods. Installing a WMS and providing the infrastructure to support the system requires financial investments. | Food (especially dairy products). Pharmaceuticals. Other areas that have a short shelf life of goods, comparable to the turnover of data item positions |
Source: https://habr.com/ru/post/215395/
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