Know exactly what you have and where it is

When a shipment arrives, don't just sign and walk away. Check the delivery against your purchase order - count the boxes, look for damage, and verify it's actually what you ordered. We've seen teams lose thousands because they didn't catch a shortage until weeks later when the supplier wouldn't honor the claim anymore. Open a few boxes and spot-check the contents. If something's off, note it on the delivery receipt before you sign. Take photos of any damage - your future self will thank you when you're filing a claim.

Once you've verified the delivery, it's time to get everything into its proper place. Assign SKU codes to any new items and label them clearly. Sort goods by category, type, or whatever system makes sense for your operation. Put fast-moving items in easy-to-reach spots and slow movers further back - you'll save your team a lot of walking. Make sure every item has a designated home location and that it's recorded in your system. A disorganized warehouse isn't just messy - it's where picking errors and lost stock start.

Keep an eye on what you've got and how fast it's moving. Set up regular checks - daily for high-volume items, weekly for everything else. Your inventory system should give you real-time visibility, but don't rely on it blindly. Walk the floor regularly and compare what you see to what the system says. Look for items that are running low, products that aren't moving, and anything that seems off. Early detection of problems here saves you from stockouts that cost sales or overstock that ties up your cash.

When stock hits your reorder point, it's time to place orders. Check whether this is an internal request (pulling from another warehouse or department) or an external purchase from a supplier. For external orders, compare at least two or three suppliers on price, delivery time, and reliability before committing. Fill out your purchase requisition with specific quantities, item details, and expected delivery dates. Don't forget to factor in lead times - ordering late is how you end up with empty shelves and unhappy customers.

Before any purchase goes through, make sure it's been properly approved. Attach the original purchase order, the sales slip, and the internal purchase requisition so the approver can see the full picture. This isn't just bureaucracy - it's how you prevent unauthorized spending and catch duplicate orders. If your approval process takes too long and delays restocking, that's a sign you need to review your approval thresholds. Small routine orders shouldn't need the same sign-off as a major purchase.

When it's time to fulfill an order or request, pick the items carefully from their designated locations. Double-check quantities against the order before packing. Goods typically go to one of three places:

1. Production (if you're in manufacturing and these are raw materials or components)
2. Directly to the retailer, customer, or end user (for finished goods ready to ship)
3. The requesting department or business unit (for internal requests)

Pick accuracy matters more than pick speed. A wrong item shipped costs you the return, the re-ship, and the customer's trust.

Every time stock moves - in or out - update your system immediately. Don't batch updates for later or rely on memory. Record the item, quantity, location change, and who handled it. Share the updated figures with everyone who needs them: warehouse staff, purchasing, sales, and finance. When records aren't updated in real time, you end up with phantom inventory (the system says you have it, but the shelf is empty) or overselling items you've already committed to someone else.

When an item drops below its reorder point, kick off the purchasing process right away. Don't wait until you're completely out - that's how you get emergency orders with rush shipping fees. If you're running a just-in-time system, use your usage data and sales trends to forecast when you'll need to reorder, rather than waiting for a threshold to trigger. Review your reorder points quarterly at minimum - seasonal changes, new products, and shifting demand all affect what "low stock" really means for each item.

You need a reliable way to know what you've got and where it is. Depending on your scale, this could be barcodes with handheld scanners, RFID tags, a spreadsheet (fine for small operations), or dedicated inventory software. The key is that every single item gets a unique identifier - no exceptions. Map out your storage locations and create a clear labeling system that anyone on your team can follow. We've seen warehouses where only one person knew the "system" and when they left, nobody could find anything. Don't let that be you.

For each item, figure out the minimum stock level that should trigger a new order. This isn't just a guess - you need to factor in how long your supplier takes to deliver (lead time), how fast you're using the item (usage rate), and a safety buffer for the unexpected. Here's a simple formula that works: reorder point = (daily usage x lead time in days) + safety stock. Set up alerts in your system so you're notified automatically when stock hits these levels. Running out of a key item almost always costs more than carrying a bit of extra buffer.

Log every single time inventory moves - receiving, transfers between locations, usage, returns, and adjustments. Each transaction should record who handled it, what was moved, when it happened, and why. This sounds tedious, but it's your safety net. Good transaction tracking is how you catch theft, spot loss patterns, and find process errors before they snowball. Without it, your inventory counts will drift from reality and you'll lose visibility into what's actually going on. If your team finds the logging too burdensome, that's a sign you need better tools, not fewer records.

Physical counts are your reality check - they tell you whether your records actually match what's on the shelves. Do a full count at least once a year, and run cycle counts more often for high-value or fast-moving items. When you find discrepancies (and you will), don't just adjust the number and move on. Investigate why the count was off - it usually points to a process problem like receiving errors, unrecorded picks, or damage that wasn't reported. Only adjust your records after you understand the root cause, or you'll keep making the same mistakes.

Step back and look at the bigger picture. What's turning fast? What's been sitting on the shelf gathering dust? Are your reorder points still right, or has demand shifted? Identify slow movers and dead stock - these tie up your cash and take up space that could hold products that actually sell. Consider markdowns or clearance for items that haven't moved in 90+ days. Look at your carrying costs and ask whether you're holding more than you need to. This review should happen monthly at minimum. The teams that treat inventory as a living system rather than a set-it-and-forget-it exercise are the ones that keep costs under control.