There are many challenges in the current world, and even sustaining proper packaging especially with disruptions, it’s been quite the challenge. Plus, managing the materials and packaging has only grown harder than ever.
The supply Chain issues
There were already issues with your supply chain before all of this, and with continuous conflicts, it’s something that you definitely will want to look at, and it’s going to only get worse before it gets better.
Planning this does require an approach to this, and the supply chains will only get worse as more and more unintended incidents and consequences happen as a result of the war, pandemic, and also the ongoing disruptions of the petroleum industry.
Most current vendors have certain clients that support them, and when supply chain issues happen, getting it from the vendors is a challenge, and many times, they either don’t have enough, or they have to charge more, and it’s a challenge for plenty of people, in order to serve the clients that are there.
Many vendors are turning to different vendors as well to help with this, and even inventory is different from what it was even a couple of years back. So how do you calculate all of this, especially with the current climate.
How to calculate current inventory
The best thing to do, is to do a little bit of calculating, and math problems to help with this.
The formula is something that you should keep on hand, in order to keep your business running as you should.
The formula is as follows:
The demand daily +the safety Stock x lead time = the packaging minimum materials that are needed, and that inventory level. This formula is something that helps you see just how much you need in order to get ahead, at least for the next 30 days.
It’s important though, that with the current packaging needs, you also multiply this by 1.5. for example, taking all of this and say it comes out to 3000 widgets, you want that number to be 4500 instead of an extra buffer. This lets you continue to be in business even if your local suppliers are a little bit slow with those lead times.
There are other components that you also need to look at too, critical aspects of items that you can’t fully empty your stock of.
Looking at the critical
You want to make sure that you know the critical aspects of packaging. That means, if something is ran out, it will shut down everything, and you can’t work. You want to make sure that you have double of these critical components, in the even that there are inventory snags.
This can cause issues with space at your warehouse, but with all of this, you can get about 2x the time for leads to ensure the abundance of this.
It’s important to make sure that you do factor in space, which does become an issue, but also think about it, this can make a difference between your business working, and your business having to shut down.
You also want to add in other waste factors, and also look at continued supply chain and labor issues. You also may find that the goods quality is going down, and you’ll want to factor that into the calculations at hand in order to compensate all of this.
Keeping ourselves informed of all of this is incredibly important, and with this, you’ll be able to prepare your supplies for any problems that may get in your way as well.