This Stock Analysis report is requested interactively from the menu when a user requires it.
Purpose
This report attempts to list all the Inventory items selected ranked by the “Line Demand”.
Line Demand is not an “Order Quantity” related measure. It is not Stock Usage or Stock Demand. Line Demand is essentially how many times the item has been order. The report is ranking each inventory item, based on the best available information to measure a total “count” of how many times a stock person went to retrieve each inventory item from a shelf in the warehouse. i.e. how many times they went to “look for” the item in the warehouse i.e. to pick the item.
Why is Line Demand useful?
Typically, the default method of placement in the warehouse (slotting) is for the “successful” lines to be placed in prominent places. Successful being measured by the total quantity being moved. They “feel” like the ones that are important, and they probably are in customer service and sales terms. But, in terms of movement within the warehouse floor they may not be.
Knowing the items with high and low Line Demand can assist a warehouse manager with the slotting of stock items within the warehouse. Line Demand take a very different approach to Order Quantity/Usage/Sales measures. It suggests that it is more important to know the high line demand items as they should be located closest to the order pickers. Not the high Sales items.
It is also just as important to know the low line demand items as they can be stored furthest away since they’re needed less often.
Examples
The examples below show the clear difference between a high “usage” item and a high “line demand” item.
Example 1 – Product A
If you get three orders in a year as below:
Order 1 – Item ordered for 10,000 units.
Order 2 – Item ordered for 15,000 units.
Order 3 – Item ordered for 25,000 units.
Total Order Quantity 50,000 units. Usage = 50,000 units. Demand = 50,000.
Line Demand = 3. That is, someone went to get Product A from the warehouse shelf 3 times in 12 months.
Example 2 – Product B
You receive 50,000 orders in a year for an item. Each order is for 1 unit.
Total Order Quantity 50,000 units. Usage = 50,000 units. Demand = 50,000.
Line Demand = 50,000. That is, you went to get that item from the warehouse shelf 50,000 times.
The Line Demand concept shows that Product B should be closer to the “action” in the warehouse to make it easier to pick. It also shows that Product A can be held anywhere probably. You could put it in another building out the back under lock and key because someone only has to get it 3 times a month.
So whilst both items have the same “order quantity” and usage, they are very different in Line Demand terms. There is no “time taken to retrieve” efficiency issues worth solving with product A. There is with Product B.
When Can I run this report?
This report is available on the menu to run anytime. Just be aware that you might get different details each time it’s run, depending on the filters used and new transactions added since the last run.