Nothing can bring the sense of fear in your typical fabricator like the word inventory. As manufacturers expand their color lines, our "scrap" racks continue to grow into ever taller stacks of inventory that more valuable. When we discover errors in our inventory counts, it is usually too late to go back and find the reason for the discrepancy. There are several schools of thought on managing and counting material, yet none seam to fully address this problem.
We currently use a simple Excel spread sheet program in which we have programmed the value of material in various sizes. Whole sheets are valued at purchase price, smaller pieces usually at some lesser price, depending on demand. We use both a working and master Excel file so that at the end of the month we can check our count by deducting usage from our master and comparing it to the working file. This additional step might seem like extra work, however, it provides control in an important area.
There are some obvious answers and techniques that can be used, but none work for all the materials all the time. Bar coding is probably the best solution (some fabricators are currently using this method), yet manufacturers are still lagging in their efforts to make sheets and bowls both uniform in bar code labeling and providing enough label locations on sheets to easily read the information.
Even with many labels, once the sheet has been cut the value and usefulness of the remaining material changes. Depending on what your primary brand use is, offcuts of different brands become far less useful and, therefore, less valuable than whole sheets. Even if you are using just one brand of material, some remaining pieces become far less valuable than when purchased, due to the lack of demand for that "oddball" color. We have pieces in our scrap rack that could qualify as antiques, yet we still hold on to them because of their size and perceived value. The ability to re-label pieces is critical for re-inventorying and accurately keeping track of the value of material.
The perfect inventory system would have most of the following features:
• Bar code based.
• Automated ordering system or alert for stock colors
• Manufacturers to provide many readable locations (ends and along entire edge of sheet)
• Long distance readability for tall racks of sheets and bowls
• Readability on dark colors
• Continuity of labeling between sheets and bowls
• Ability to print new labels at the point of cutting to re-label pieces.
• Instantaneous updating of inventory changes
• Price change feature to discount seldom used colors when cut
• Automatic tagging of material when job is sold
• Integration into existing project management and accounting software
• Spot check inventory measuring control system
• FIFO control (first in first out management)
• Ability to use existing PDA's (Tractivity or Palm Pilot) for data collection
This issue becomes especially important every month when we look at our P&L. As everyone knows, you can only manage what you can measure. With inventory representing between 40 to 45 percent of our cost of goods, an inaccurate count represents an error with the single biggest item impacting the accuracy of our financial statements.
Many software companies claim to have the solution in place, yet when pushed to produce a working demonstration the software turns into "vaporware" - either the product is not yet complete or it doesn't perform up to the claims that have been made. Completely solving this problem will also require the cooperation of all material manufacturers by standardizing label location and bar code information. Perhaps you have the perfect solution that meets most of the features listed above and are willing to sell it at a price fabricators can afford. If so, then stop reading, and start marketing your process because we need it now.
About the author: Jon Lancto is president of Solid Surface Products in Cornelius, N.C., and has extensive experience in solid surface fabrication. He is a founding member of ISSFA, and served for four years as the fabricator association's first president.