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Managing stock levels is a persistent challenge that requires considerable effort to optimize. This issue is particularly pronounced for businesses based in New Zealand due to the extended delivery times for products sourced from overseas.
Our client manufactures bespoke air filter units on demand, importing many of the raw materials from China. The process begins with a client requesting quotes for a specific type of filter with particular dimensions and materials. The system can identify the product from its specifications and, if the required product is new (i.e., it has never been produced before), it can create a new product from a template and compile a bill-of-materials for its manufacture. From this bill-of-materials, the system calculates both the build cost and the customer price.
When an order is placed, the job is sent to the manufacturing manager. The system then checks to ensure sufficient quantities of all required materials are available in stock before adding it to the manufacturing list. At this stage, any potential shortages are identified based on the minimum stock quantity, and a Purchase Request is raised accordingly.
A crucial data point in this process is the Minimum Stock Quantity, which is calculated based on the Estimated Delivery Period. The system regularly reviews the stock dispatch history over previous weeks or months and recommends adjustments to the Minimum Stock Quantity if it predicts a change in the number of dispatches in the upcoming period.
Once the job is assigned to the factory, the stock levels are automatically updated, and the necessary accounting transactions for Work in Progress are generated.
Upon completion, the finished products are returned to stock, where they can be picked, dispatched, and invoiced accordingly.
