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Warehouse Management

Streamline Your Supply Chain with Advanced Warehouse Management and MD365
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Streamline Your Supply Chain with Advanced Warehouse Management and MD365
Streamline Your Supply Chain with Advanced Warehouse Management and MD365 700 500 Xcelpros Team

Warehouse management is a key aspect of modern supply chain management that demands the full attention of a business to be efficient. In this post, we look at warehouse management in Microsoft Dynamics 365 Finance & Operations.

Overview of Advanced Warehouse Management in D365 F&O

Microsoft Dynamics 365 is one of the most well-known ERP (Enterprise Resource Planning) solutions offering innovative, AI-driven assistance for Finance, Operations, and Supply Chain Management. The Warehouse Management module of D365 offers a wide range of optimized capabilities to manage even the most complicated supply chains.

Worldwide, manufacturing and distribution companies of all sizes rely on D365 warehouse inventory management to support their supply chain operations at a core level. When a system like D365 is implemented correctly, it’s easy to gain efficiency and flexibility at every level. Furthermore, D365 enables warehouse owners to set up multiple priority-based storage areas within a warehouse making it easy to gain visibility into their supply chain. According to research from World Economic Forum, challenges like high overheads, growing competition, and evolving customer expectations continue to cause severe impediments.

When it comes to supply chain efficiency, gaining full visibility has become extremely important, permitting businesses to build a direct link with consumers and partners. Supply chain visibility is critical to building a strategy to reduce risks, drive innovation, and build customer trust.

Key Warehouse Management Processes

Figure 1:Key Warehouse Management Processes

Key Warehouse Management Processes

Full visibility makes tracking evolving customer needs, behaviour, and trends easy. This information makes it possible to optimize warehouse operations according to what the end customer is seeking. While not always easy, it’s quickly becoming non-negotiable.

The main reason so many businesses use D365 for supply chain and warehouse management is the wide range of modern features it offers in one solution, including –

  • Placement and Storage D365 let you define the stock based on query-defined rules that make tracking products easy. Users can define location and storage policies down to item and warehouse levels to ensure that RFID (radio frequency identification) capabilities are accurate and updated. You can streamline the storage facility greatly by dividing the warehouses into different zones, defining the storage needs, and even specifying an item’s location with the aisle, rack, and shelf details.
  • Inventory Dimensions D365 gives you visibility into specific inventory details like warehouse and location, as well as basic characteristics like size, color and more. Users have full control over how the products are stored, how warehouse storage costing is decided, and how inventory tracking is happening by defining the inventory dimensions according to any operational requirements.
  • Serial and Batch Number ControlD365 makes it easy to add and manage batch and serial numbers to things like finished goods and raw materials, streamlining the ability for your team to track their location as they move through production. As you gain full control of serial and batch numbers, it becomes easier to trace the quality assurance and warranty of your finished goods. As a bonus, properly assigning serial and batch numbers to your goods and products lets you know exactly where they are in your system, and whether the order has been shipped or not.
  • Wave TemplateWave templates in Dynamics 365 give users the ability to create and manage multiple Shipping, Production and Kanban Wave Templates can be processed manually or automatically. As these Waves are processed, specific work is assigned to a warehouse operations team(s) to be completed for different locations or scenarios. Setting up a wave template includes defining the location or warehouse that the template will create the work for, the order the system will follow if there are multiple waves, and actions to be taken when the wave is processed. Examples of Wave Template types include shipping or transferring orders, or special care and handling instructions for moving items in production. Wave templates create work from Work Templates and Location Directives (pick and put locations) for a specific warehouse.
  • Work Templates and Location DirectivesD365 also includes Work Templates and Location Directives to help define and standardize the operations crucial to a business’s warehouse management. Work templates define “work” and lay out specific pick and put process steps for users to follow in warehouse transactions. Work templates are not location specific by default, and only describe the actions to take.
    • PICK an item from a rack or shelf location
    • PUT an item into a packaging area
    • PICK an item from a packaging area
    • PUT an item into a shipment

    Location Directives describe the same steps for different sites and locations. Location Directives are specific directions for managing or moving inventory in a specific warehouse or location for different scenarios like handling of larger quantities, or specific storage location types like cold storage, freezers, etc.

  • Replenishment TemplatesReplenishment templates in D365 let you define the replenishment process for multiple locations. D365 includes the ability to set different replenishment strategies for different warehouses:
    • Wave demand – the default strategy designed to find locations that can be replenished until demand Is covered
    • Maximum location capacity – like Wave demand, but locations are replenished to maximum capacity.
  • Pick and Put-away ordersD365 makes it easy to pick and put items for outbound loads with handheld or mobile devices. You can define the order picking and dropping locations while streamlining the logistic chain. D365 enables warehouse managers to ‘pick’ any load from the warehouse and ‘put’ it directly to staging, making outbound loading and delivery quick and smooth.

Role of Advanced Warehouse Management In D365 F&O In Cost Reduction

Current trends indicate that supply chain management solutions focus mostly on controlling overhead. D365 can accomplish this by offering businesses full control and monitoring of their workforce and their warehouses.

‘D365 further helps reduce costs by offering full visibility of your operations, as well as the ability to manage your bills and invoices and optimize new or existing routes.

Other Benefits

  • Office IntegrationBeing able to streamline your supply chain is only possible when all related workflows are optimized, integrated, and capable of capturing and sharing key data without issue.

    D365’s native integration to Microsoft’s Office 365 products like Outlook, OneDrive, Word, Excel, PowerPoint, OneNote, SharePoint, Teams, and more to make all possible to share and access information anywhere in the world.

  • Better Customer ExperienceWhen your systems are all fully integrated at a workflow level, you’re able to stay on top of your operations and the things that matter most to your customers, including things like timely support options, accurate forecasting, dynamic pricing and more.
  • Insight-driven ReportingD365 provides a wide range of detailed reporting options like Labor by job, Labor by users, Sales by product, equipment failures, warehouse transactions, and more. These insight-driven reports work in real-time to give businesses the ability to respond to problems and demands quickly and efficiently based on real data.
  • Warehouse PerformanceDynamics 365 offers multiple ways to monitor the overall performance of your supply chain quickly and easily by breaking down your entire warehouse into products, vendors, and sites. Inbound performance monitoring ensures vendor performance, tracks delivery, and identifies potential loopholes. Shipping performance monitoring ensures finished goods and products are shipped to customers at the right time.

Conclusion

It’s important to understand that the ability to streamline a supply chain depends on effective warehouse management – not an easy job.

This is where a scalable solution like D365 can be used to address a wide range of potential challenges related to ‘pick and put away’ orders, cycle counting, barcode and label support, and keep overheads to a minimum while still being able to meet continuously evolving customer demands.

Making sure it’s done right the first time means working with a partner that understands your industry and knows how to streamline the process and maximize your ROI (Return on Investment).

For more information and to find out how we can help optimize your supply chain contact us today.

Staying ahead of the curve Warehouse Management Trends in 2022
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Staying ahead of the curve: Warehouse Management Trends
Staying ahead of the curve: Warehouse Management Trends 700 500 Xcelpros Team

Introduction

Remaining competitive in today’s global marketplace has become more important than ever. Consumer habits continue to change, and businesses are finding themselves stocking more and more items. An efficient warehouse management solution is the best way to ensure customer satisfaction at a time when everyone expects things like next-day delivery, BOPIS (Buy Online Pickup in Store), and more.

Thankfully, managing a growing SKU count is getting easier and the technology already exists to help improve your supply chain and bottom line.

Keeping an eye on the changing technology landscape is a good way to get started – here are some of the advanced warehouse management trends we’ve seen in 2022.

Automation

More warehouses are striving to be fully automated than ever before, from self-driving forklifts and automated inventory systems to sophisticated barcode scanning and sorting. Many companies see full automation as a cost-saving measure as they shift their budgets from human workers to technology – becoming more important as SKU counts continue to grow to meet consumer demand.

According to Capterra, 54% of warehouses plan to expand the number of inventory SKUs carried over the next five years.

Manufacturing plants have seen similar trends, with equipment automation replacing traditional manufacturing processes such as machining and assembly. You’ll need to think creatively about how automation can change your processes and make your jobs easier. Some innovations include adding robotics or autonomous vehicles into your delivery process; building more efficient ways to collect data; or developing mobile apps that make data easily accessible to your employees, wherever they are.

Sustainable Warehouse Solutions

Supply chains and warehouses have always been a driving force of the economy, and as we move into the future, warehouse management trends will continue to affect global supply chains. One of the most significant changes driving growth in sustainable warehouse solutions is increased consumer pressure for sustainable goods and services. Consumers want more transparency and accountability with their products, which improved tracking technologies can only achieve.

Another factor influencing this change is an increase in regulations governing environmental impact. For example, several European countries banned single-use plastic packaging earlier this year due to the damage it causes, leaving companies scrambling for viable alternatives, like bio-based plastics or renewable materials like bamboo.

Supply chain management solutions like Microsoft’s Dynamics 365 will play a vital role in managing inventory, assets and faults and improving compliance with regulatory bodies like the FDA, EPA, REACH and more.

Internet of Things (IoT)

Internet of Things (IoT) technology in warehouse management continues to grow and offers new benefits like reduced costs, better forecasting, and easier scalability.

Sensors and cameras continue to improve, and newer RFID (radio frequency identification) tags or beacons tell you exactly where an item is at any given time.

The data collected from these sensors leads to a better customer experience because you know exactly how long it takes for a package to be delivered or whether there are any delays with your orders. This makes your warehouse inventory management easier.

When managing people, IoT technology will allow you to reduce overtime hours and increase efficiency. Using drones and autonomous vehicles lets you confidently adjust your business strategy by setting prices based on demand or supply chain availability.

Some experts predict that we’re nearing the point where IoT technology will be doing a lot more tedious work like stock picking and placing items into cartons—saving companies money and freeing up valuable labor hours for other things like customer service or development projects.

Wearable Technology

Technology is changing how work is done everywhere, and warehouse management is no exception. We already see hints that in the not-so-distant future, fewer people will work in warehouses due to the rise of wearable technology. Examples include Exo-suits, Smart Glasses and audio devices – powered devices designed to reduce physical requirements and give workers hands-free access to their data and instructions.

These devices could replace warehouse management equipment like head-up displays or tablets. Amazon, for example, has already patented a system allowing its employees to use wearable devices while at work. These devices focus on 100% accuracy thanks to the ability to fully validate your inventory.

Some analysts believe this trend would lead to higher costs for shipping companies and consumers because it would require new training programs, and many warehouses wouldn’t need human labor. Others feel these technologies might reduce costs because they increase productivity and reduce errors.

The fact remains that wearable technology holds exciting potential and could change the way we manage our warehousing processes. However, it’s still unclear exactly what effects it will have on business owners and consumers.

Augmented Reality (AR)

Even now, fulfillment centers are beginning to use augmented reality (AR) technology to help with logistics and planning. This trend is expected to grow and expand over the next few years.

There are many benefits, like training and easy visualization. Still, one of the most important is that warehouse managers and personnel can use AR daily without having an expensive changeover cost when they start using it.

This technology provides instant feedback with data from multiple locations, so managers know exactly if their supply chain is performing as expected or if any issues need to be addressed. The wireless nature of these devices means AR is perfectly suited for work in and around warehouses.

Digital Transformations

Warehouse management is going digital everywhere. E-commerce and omnichannel retailing have become much more popular, leading businesses to invest more in warehouse management software and automation. The ability to deliver products from their warehouse on time with less employee involvement is what many businesses have been aiming for.

Companies want their warehouses to be fast and flexible, moving with the needs of changing business conditions. Warehouses are now being designed with reconfigurable storage systems, which can be changed based on current storage needs without downtime or significant disruption.

For this level of automation and digitization to happen, these enterprises need a great deal of up-to-date data about their inventory and how quickly they can process orders. Fortunately, warehouse management solutions like Microsoft’s D365 provide real-time updates on inventory levels and shipping rates. These are just a few reasons we’re seeing more businesses finally replace their aging legacy systems – and when all is said and done, they’re much better off for it.

What comes next

Staying up to date on changes in technology can be a full-time job. One of the best ways to understand what comes next is by working with a partner that understands your business.

As your company grows and your warehousing needs change, your partner can ensure you’re using the perfect solution.

Whether you’re looking for a whole new warehouse management solution or just adding on newer functionality, your partner should be there to set you up for greater success.

Be prepared for what comes next, contact us today to find out how we can help.

Best techniques for tracking and managing raw materials
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Best techniques for tracking and managing raw materials
Best techniques for tracking and managing raw materials 700 500 Xcelpros Team

At a Glance

  • 18% – The hike in the Raw Material Price Index from 2020-2021 with at least another 10% hike expected.
  • 60% – The increased amount of raw materials extracted, harvested and consumed since 1980.
  • 117% – The increase in raw materials costs for non-food agricultural materials since 2000.
  • 359% – The cost increase in rubber since 2000.
  • 62 billion metric tons – The amount of raw materials used per year in 2008, an 8-fold increase since the early 1900s.

Introduction

Today, manufacturing relies heavily on the ability to acquire raw materials, both directly and indirectly. Examples of direct raw materials are the chemicals, textiles, minerals and other components that become finished products. Indirect raw materials are components added to other parts that together make a finished product. Accurate tracking of these materials is a good way to determine if a company flourishes or fails. Both of these material types are listed as current assets.

Tracking raw materials typically starts when they enter a warehouse. Their value is calculated from the start of a given time and adding costs such as storage, shipping, processing and labor to determine total value. Before you can build, mix or blend your products though, you have be sure to acquire them. Obtaining the essential materials you need to create your products is the end result of an involved process.

Obtaining Raw Materials

One of the first things to do before you start acquiring raw materials for your products is sufficient planning. Raw material planning can be used to determine how quickly you use each item, but only once you understand your inventory turnover rate – the number of times you use your raw materials.

In a previous post, we stated that “Materials planning is the method used to determine the requirements and quantities of raw materials to implement production.” If you don’t have enough raw materials on hand, you can add delays to your production schedule, or even lose orders altogether. If you keep too many materials on hand, there may not be enough budget available for other projects, like capital improvements.

A critical part of materials planning is understanding lead time: how far in advance do you need to place orders with your suppliers to get what you need in order to satisfy your customers?

Being sure you can order what you need requires a procurement management plan that, “defines requirements for a particular project and lays down the steps required to get into the final contract,” including raw materials.

This plan sets and defines everything you need to manufacture your products: what to buy, who to buy it from and how much you’ll pay. This includes determining purchase costs plus delivery and storage costs, also referred to as inventory costs. Placing an order, or receiving one from a customer, often uses an order management plan.

If your departments are unable to report how much of a given product, or the raw materials required in the process, are on hand, entire orders can be lost. When production tells sales one thing, but inventory says something else, the end result can be chaos. This is where accurate, frequent, communication that tracks the flow of raw materials through the entire acquisition process becomes critical.

Inventory Management

“Inventory management is important to small businesses because it helps them prevent stockouts, manage multiple locations and ensure accurate recordkeeping. An inventory solution makes these processes easier than trying to do them all manually.”

A chef can make a large salad using a full head of lettuce but only a teaspoon of spices. Managing inventory is often similar: A manufacturer is likely to have some items they use in large quantities, such as active pharmaceutical ingredients (APIs). Equally important are the catalysts and other chemicals bought in much smaller lots. Like a chef making a salad, without their ingredients, they don’t have a product.

Inventory management not only tracks what you have on hand, it also looks at your supply chain: making sure you have options for getting what you need when you need it. One part of inventory management is getting your basic supplies: making sure your customers receive their finished products when they need them is another. Having viable shipping options to ensure your merchandise arrives on time means gathering even more information and constantly updating your options. A common option used by a large number of companies, especially retailers, is vendor managed inventory.

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Vendor Managed Inventory

Commonly referred to as VMI, vendor managed inventory is when a company lets its suppliers determine the amount of product a company has in stock. If you walk into a grocery store you might see people who are not market employees stocking shelves. These are vendors – these employees track inventories, place orders, monitor shipments and stock shelves.

According to American Express, benefits of a VMI include:

Figure: 1Benefits of Vendor Management Inventory

Example of a Barcode

  • Improved efficiency You have the right quantities on hand to meet your needs without going overboard and having too much or too little.
  • Cost reduction Having accurate inventories means few if any disruptions to sales, thereby providing better customer service.
  • Reduced complexity Depending on your products, you may be able to reduce the number of vendors. The result is a predictable and reliable inventory schedule.
  • Data insights Your supplier can anticipate demand, helping you prepare for seasonal and market-driven trends.

Working with a single VMI has some negatives as well as positives. Three of the biggest challenges, according to AmEx, include:

  • Loss of control Someone else determines what products you have and therefore what you’re able to sell. Using a VMI also means an outside company has access to your private data. Data security can be a major issue, especially when you first start working with a vendor.
  • Limited options It’s tough to make a fruit salad when the only fruit available is an orange. Your product choices may be limited and you might become dissatisfied if your vendor fails to deliver at the best price.
  • Market agility Working with a single vendor reduces your ability to pivot when markets change. For example, some whiskey manufacturers were having problems selling their goods when the Covid-19 pandemic took hold. A few of the more enterprising companies were able to switch from making whiskey to producing alcohol-based hand sanitizer. Using a VMI might eliminate this flexibility to quickly change in response to market conditions.

Looking at your options and picking the best ones often comes down to software. Managing your raw materials and inventory accurately, especially when your company is growing and has distant suppliers, generates a lot of data. Managing this vast amount of data requires capable software.

Software Options

Depending on your needs, two types of software can help with your raw materials management, inventory management, order management, procurement management, stock management and resource planning needs:

  1. 1.Customized products designed to perform a specific function for a single industry with a company at a particular size. If your company is unlikely to grow, one or more of these products might be perfect for your needs. Using this type of software, you will likely need one product for each requirement. This is likely to mean using several different providers, potentially creating data exchange roadblocks. A second option offers greater flexibility, the option to handle many of these needs in a single package while also growing with you.
  2. 2. A modular Enterprise Resource Planning (ERP) product such as Microsoft Dynamics 365 Supply Chain Management is a large, versatile product capable of helping you track inventories from far-flung suppliers into, through and out of your warehouse. Microsoft Dynamics products are based in the cloud and offer added data security since they’re built on Microsoft’s Azure platform. Modular systems let you add sections when needed while maintaining constant communication between the modules. Using a system from the same company also ensures constant data flows, reducing inventory data errors.

The Bottom Line

Especially today, managing raw materials accurately requires a lot of work and attention to detail. Errors at any stage of the process – from ordering to shipping, storing or using – can result in expensive repercussions.

Finding the right software solution means evaluating your current and future inventory needs. What do you need now? Will solving today’s problem also work in 1-5 years or will it require an expensive overhaul?

The bottom line is that you should consider an investment in a modular product that can grow with your company over time, and not one that becomes obsolete the minute you expand.

streamlining-the-label-management-process
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Streamlining the Label Management Process
Streamlining the Label Management Process 700 500 Xcelpros Team

At a Glance

  • $10 million: The average cost of recalls to food companies that can are caused in part by inaccurate labels.
  • $65,000: The average cost of incorrect labeling based on a 2020 survey. Of that group, 61 percent said mislabeling costs exceeded $50,000.
  • 10-26%: The number of products mislabeled every year according to a survey of 300 IT directors in the U.S., UK, France and Germany.

Introduction

Labels serve three primary purposes in a consumer’s eyes. Labels help to:

  1. 1.Identify the contents of a product
  2. 2.Identify the product name
  3. 3.Promote the brand image

In combination with well-designed packaging, certain label parts could be considered one component of an effective marketing campaign. From a business perspective, though, labels need to do much more than tell consumers what is inside. Efficiently labeling and tracking is the best way to monitor a product’s performance, along with ensuring customer safety is the best it can be. This is especially true when it comes to certain industries like pharmaceuticals.

Packaging and Labeling

There are many key points to note when it comes to packaging and labeling, including the following:

Definition:

Labeling refers to the text, design, symbol, logo, instructions and use suggestions printed on the product package. Labels are designed to inform and attract customers by providing information.

Objective:

Labeling provides all information required by the governments in the geographical location where the product is marketed, sold and used.

Focus:

While exterior packaging is about appearance, labeling focuses on what’s inside. For example, products are required to accurately list the primary ingredients and their nutritional value when it comes to food. Labels on medicines must include active and inactive ingredients, allergic reactions, and harmful side effects.

Label designs are usually simple and formal. They may follow a government or company template. These can require a set list of data fields such as country of manufacture and expiration or “use by” date. Hazard information is typically posted where a customer can see it before making a purchase.

Effective label designs also include inventory tracking options while also meeting government requirements.

Inventory Tag Controls

“When paired with a competent asset or warehouse management system, inventory tags can be scanned to inform your supply chain of changes in your current inventory. This practice helps build end-to-end visibility among all parties, from supplier to customer, as your inventory moves through your warehouse,” according to a blog post by CamCode.

Inventory tags can be integrated into a product’s label design. The most common inventory labels we see doing this are bar codes. Barcode are a series of vertical lines—generally black—of varying widths interspersed with white gaps. QR (i.e., quick response) codes are a form of bar code generally in a square or rectangular format with black blocks and white spaces.

Speed is the main advantage of using a barcode or QR code label. Handheld and machine scanners can read the barcode information, sending it to inventory tracking software. That software can then automatically update inventory counts, eliminating the need for manual checks. The result is a fast, more accurate inventory update. A critical part of inventory tagging with barcodes is using the right type. Before creating any labels, companies should ensure they understand any regulatory or equipment-based requirements for the barcode type, label size, and label material type.

Figure: 1Components of a Barcode

Example of a Barcode

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Different Types of Barcodes

Barcodes primarily come in three different types:

  • Numeric only with a row of numbers beneath the bars
  • Alpha-numeric with a row of letters and numbers
  • Two-dimensional (QR is one example) using a series of small dots arranged in a unique pattern

The type of barcode a company chooses often depends on its industry and how the product will be used. For example, the Postnet format encodes destination information using long and short lines. Retail items often use the Universal Product Code (UPC).

The U.S. Food and Drug Administration (FDA) has several requirements for barcodes. While the FDA does not require a specific code format, it mandates the barcode include the drug’s national drug code (NDC) number. Machine-readable information on blood and blood components must be on those labels.

“This new system is intended to help reduce the number of medication errors that occur in hospitals and health care settings,” according to the FDA.

These FDA rules apply to manufacturers, repackers, labelers, and private label distributors of human prescription drug products, biological products, and over-the-counter (OTC) drug products to protect consumers from dangerous side effects or worse.

Labels alone are not enough. However, companies need to be able to accurately track their inventory as well as safely manage any recalls or other issues with products. This only works when you have the right software in place.

Inventory Tracking Software

Software like Microsoft Dynamics 365’s Supply Chain Management includes several powerful inventory management features helping these businesses thrive today. For example, Supply Chain Management can automatically assign serial numbers based on manually entered (or scanned) batch numbers.

Dynamics 365 Supply Chain Management also makes creating and tracking barcodes for released products easy. This modern inventory management software also works with the GS1 bar code and QR formats for use on shipping labels.

Microsoft says, “Unlike older bar codes, GS1 bar codes can have multiple data elements. Therefore, a single bar code scan can capture several types of product information, such as the batch and the expiration date.”

With a system like Microsoft’s Dynamics 365 Supply Chain Management, you can use a predefined list of application identifiers to define the meaning of your data and connect it with GS1 codes. Microsoft suggests, “The setup of the application identifiers defines how the system should interpret a bar code and save it as a value in the system.”

The Bottom Line

With today’s focus on consumer safety, proper labeling and tracking of products, especially when it comes to pharmaceuticals and medicine, will continue to be of utmost importance, including efficiently dealing with government regulations. Today’s businesses need to ensure they’re taking advantage of inventory tracking software that lets them easily create labels that help track the flow of raw materials, from work in progress to finished goods.

Programs like Microsoft Dynamics 365 Supply Chain Management can create unique QR codes that contain a list of ingredients, allergy information, serial and batch numbers, hazardous warnings, and safety data sheets. Solutions like these let your warehouse staff scan products and send information wirelessly to any device on the network more efficiently than ever before. Is your labeling solution up to speed?

Resources: Packaging vd Labeling

Warehouse management challenges in the pharmaceutical industry banner
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Warehouse Management Challenges in the Pharmaceutical Industry
Warehouse Management Challenges in the Pharmaceutical Industry 700 500 Xcelpros Team

At a Glance

The pharmaceutical industry faces some unique warehouse management challenges. Many of these issues can dramatically impact medications, even though they may not exist in industries such as general retail.

Key issues facing warehouse managers include:

  • Keeping portions of their facilities at the correct temperatures to prevent medications from spoiling.
  • Following federally-mandating good manufacturing process rules.
  • Security issues for products and intellectual property.
  • Inventory controls.

Warehouse issues specific to the pharmaceutical industry include:

  • Temperature control: Active pharmaceutical ingredients (APIs), precursor chemicals, and manufactured drugs frequently require controlled temperatures. A general temperature range for a cool, dry place is between 59-77° F (15-25° C). Some products, such as vaccines, may require freezing. Exposing drugs to the temperature outside their effective ranges can cause chemical changes and reduce a drug’s effectiveness. For example, Baystate Health states that medications containing hormones do not work as well when exposed to colder or hotter temperatures.
  • Humidity control: Moisture condensing inside packages can impact a medication’s effectiveness. Baystate Health states that blood glucose strips exposed to humidity will give inaccurate readings.
  • Light exposure: Exposure to ultraviolet light from the sun and other sources can change the chemical structure of some medications. The light exposure causes photodecomposition, reducing the medication’s potency. Light exposure can also cause side effects after administration, such as phototoxicity and photoallergy, a 1997 post in PubMed states.
  • Adhering to the Food and Drug Administration (FDA) Current Good Manufacturing Process (CGMP) standards for warehouses, processes, and drugs: Includes keeping careful track of item locations within the warehouse.

According to Kanban, the FDA’s CGMP warehouse standards include the following:

  • Contamination prevention: Storage must allow inspection and cleaning.
  • Identification: Each drug must have a unique, traceable code that identifies the lot’s status, such as approved, quarantined or rejected.
  • Distribution Procedures: Written procedures describing the distribution process for each drug including recalls.
  • Storage Procedures: Written procedures describing the storage conditions for each drug are required.

Some pharmaceuticals require only temperature controls for specific ranges. Other medications require climate-controlled environments affecting temperature and humidity.

Figure: 1Pharmaceutical Warehouse Management Challenges

Pharmaceutical Warehouse Management Challenges

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Following GMP Rules

GMP SOP states that following the Good Manufacturing Process (GMP) rules enables manufacturers to:

  • Protect medicines and raw materials for medicines during storage
  • Prevent finished product degradation
  • Avoid contamination from other materials
  • Prevent damaged or expired products from being shipped

Warehouse managers also face the challenge of keeping track of three types of items appearing on the packaging bill of materials governed by GMP procedures. Each of these item types requires unique lot numbers:

  • APIs, precursor chemicals and other starting materials
  • Packaging materials
  • Printed materials

All warehouse managers face inventory control requirements. Those in the pharmaceutical sector also deal with intense government scrutiny.

Receiving Shipments

Other GMPs in the pharmaceutical industry require materials arriving from suppliers to be reviewed based on their use. For example, it’s important to check starting chemicals to confirm they are:

  • From a source approved by the company
  • Free of damage and defects
  • Labeled with all required information
  • Have a unique identifier
  • Registered in the company’s inventory database
  • Quarantined until quality control tests are performed
  • Stored appropriately and safely, such as in a temperature-controlled section or “Dangerous Goods” area for flammable and toxic materials

Unlike retail goods warehouses, pharmaceutical warehouse managers should also set aside an area for raw materials to be tested and confirmed to meet all required standards. A similar section should exist for any materials that fail these tests, GMPSOP states.

Sampling and Testing

Sampling and testing should be done in a room having sections with positive air pressure (i.e., the air pressure is higher than that outside, preventing contaminants such as dust, microbes, pollen, cleaning agents and lubricants from entering) and negative air pressure (i.e., the pressure is lower than that outside to prevent materials from inside the room going outside). An airlock with positive pressure keeps out external contaminants. With the airlock sealed, the inner testing can have negative air pressure to keep chemicals from contaminating the larger warehouse.

Other sampling room requirements include clean instruments and appropriate personal protective equipment (PPE) as required by the federal Occupational Health and Safety Act (OSHA) and the FDA. OSHA has a downloadable brochure on warehouse safety.

Storage and Tracking Inside the Warehouse

“Lack of control over material movement in the warehouse can, and has, led to defective products,” GMPSOP states.

General warehouse practices (GWP) require that:

  • Received unused goods and finished products are quarantined until approved for release.
  • Items have correct status labels (e.g., current, expired, etc.)
  • Unique identifiers are visible.
  • Products are stored by type when appropriate.
  • Access to toxins and addictive drugs or chemicals is stored separately. Access is limited only to approved personnel.
  • Materials are tracked as they move through the production facility from the Receiving area to Production and then to the Shipping.

When possible, warehouse managers should have separate sections to store damaged or returned goods, recalled items, “not for sale” samples and when identified, counterfeit materials.

Labeling

Another challenge for pharmaceutical warehouse managers is accurate labeling. GMP rules require labels to include a familiar name and Unique Identification Number that must be different from the supplier’s lot number. The UIN must be recorded in the lab, on the facility’s computer system, and in production. GMP SOP suggests not referring to the IUN as a batch number.

Other requirements unique to pharmaceutical labeling include:

  • Expiration dates
  • Barcodes for additional tracking options
  • Status indications, typically in the form of a color code
  • Quarantined products
  • Items being held for investigation
  • Rejection labels when an item fails to meet required standards
  • Approval and/or release labels indicating the item can proceed to the next step in the supply chain

Security Challenges

Medicines and other pharmaceutical products are in high demand, making them tempting targets.

Warehouses should have secure physical storage areas for raw materials and finished products.

In addition, Avcostar states that the formulary, drugs, and drug components are expensive and prone to theft. It suggests performing a risk analysis audit that includes where known security breaches occurred. “The company can then focus on identifying and eliminating the most vulnerable posts and systems against malicious access, modification or deletion of data, enhance access control to systems and data and implement new cybersecurity best practices,” Arecont Vision Costar VP of Marketing Jeff Whitney states.

The code of federal regulars 21 CFR Chapter 1 requires control of all production stages, including system validation and audit trails. Refer to this article from Cornell Law School for detailed information.

Solving Challenges

Effective use of warehouse management computer systems, such as the warehouse management module in Microsoft Dynamics 365’s Supply Chain Management, can help track inventory management in pharmaceuticals accurately and manage these challenges.

The module “has a wide range of features to support the warehouse facility at an optimal level at any time,” according to Microsoft. Among the warehouse module’s functions are:

  • Workflow support
  • Using mobile devices
  • Full batch and serial item support
  • Label printing and routing
Effectively-Tracking-and-Controlling-Inventory
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Effectively Tracking and Controlling Inventory
Effectively Tracking and Controlling Inventory 700 500 Xcelpros Team

Introduction to effective inventory management

Especially today, manufacturers, wholesalers and retail businesses from several different industries share several standard business practices, with inventory management at the top of the list.

An efficient, capable inventory management system can distinguish between struggle and success. Any boost to the efficiency of managing your inventory can result in a significant return on investment. To drive the effectiveness of your inventory management, especially when if you’re just getting started, it helps to pay attention to 10 popular techniques:

1.Fine-tune your forecasting Accurate forecasting is a must unless you want to either tie up precious capital in product stuck on warehouse shelves or be unable to meet your customers’ orders.

2.Identify low-turn stock Have a flexible ordering approach that, combined with accurate forecasting, lets to adjust inventory based on customer priorities.

3.Regularly audit your inventory Knowing—not guessing—what you have at any given moment lets you adjust ordering to ensure a balanced inventory.

4.Track stock levels You want to track all inventory from the moment you purchase raw materials or components to when you deliver finished goods to your customer’s door.

5.Keep track of your equipment Especially in a production plant – Knowing what you have, how quickly it wears and when to schedule repairs for optimal life ensures uninterrupted production runs.

6.Verify Quality Ensure all items in your inventory meet your quality control standards, ideally from the moment they arrive.

7.Categorize inventory based on customers needs Ensure you have the most sought-after products in stock at all times, working your way down the line to the least popular products.

8.Consider drop shipping This is much quicker especially for any items you don’t make yourself, especially when it becomes part of your product. An example is a Siemens ® controller for industrial machinery.

9.Rotate your stockTurn your stock so the oldest items are sold first This is especially true for pharmaceutical products with comparatively short shelf lives.

10. Use good inventory management software A viable program that meshes with your financial and sales software helps keep everyone informed, making for happier customers.

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Figure 1:Common inventory management challenges

Common inventory management challenges

Common Inventory Management Challenges

Among the most common inventory management challenges that can affect a number of different businesses are the following:

  • Inconsistent tracking Working with older software that relies on manual data entry opens a company to data entry errors. Mistakes are bound to happen when different departments use different spreadsheets to input the same information.
  • Inaccurate data Companies need to know how much of everything they have on hand and in the pipeline. Without accurate information, you won’t be able to track your production. This can be a massive problem if you’re still manually entering data.
  • Order management Manufacturers often live on the edge of logistics, struggling to make sure deliveries are going out just in time – right before their customers need them.
  • Juggling a complex supply chain Manufacturers need alternate ways of obtaining raw materials and shipping finished products. For example, your primary port is running behind because dock workers are sick. How do you get what you need when you need it?
  • Communications and planning Intercompany communication is critical, especially in a world where companies often have business units in different countries, keeping everyone focused on the same task can be difficult.
  • Robust competition In every industry, competition is ready and willing to grab your customers when you make a mistake or find yourself unable to deliver on time and within budget.

These are a few examples of the challenges faced by modern manufacturers. Thankfully, the good news is that modern ERP solutions can be a huge help when it comes to addressing these issues.

Inventory Management Software As a Solution

Several inventory managements programs available on the market today that focus not only on addressing these challenges, but also by identifying potential issues before they can impact your operations. Some of the best solutions available, like Microsoft Dynamics 365 Supply Chain Management, can seamlessly integrate with your existing software, reducing data silos, allowing different departments to share more information. Instead of requiring three departments to input the same information into a database, each group is able to provide material unique to their specialty.

Effective inventory management programs like Microsoft can print barcodes and QR labels. When these codes are scanned with a hand-held reader or cellphone, users can be rewarded with a wealth of information. The most critical data to track are precisely how much of any product you have, where it’s being stored, and what it will be used for.

For example, you need to produce 20,000 doses of a Covid-19 treatment. Your customer needs them yesterday but will settle for next week. Do you have enough raw materials on hand to meet your customer’s deadline? If not, what can you do to obtain what you need?

Using this information wisely lets management develop complex plans, like the ability to track everything from small lots to pallet loads. A company can learn by checking an item’s progress at different points—its arrival at the warehouse, use in production, loading onto a truck or ship, and delivery to the customer. By examining reports, you can identify potential delays or roadblocks and find ways to speed up delivery.

Supply chain management software on a secure cloud computing platform like Microsoft’s Azure let’s you communicate securely and safely with other researchers, salespeople and vendors. With Azure, you’ll know that your intellectual property and contracts are safe from competitors.

Boost Decision Accuracy with Power BI

With today’s supply chains – seemingly constantly in a state of upheaval – effective inventory management that goes beyond tracking stock on hand is critical to operations. Effectively managing your inventory and raw materials ensures you’ll have the materials you need when you need them. It means having more than one source of supplies and materials. It also means constantly checking with vendors to ensure you have the goods to meet your own delivery deadlines. This is where an integrated business intelligence solution comes into play.

Microsoft Power BI let’s you connect to hundreds of data sources, preparing reports you can easily share. You can confidently deliver interactive messages to customers using information from inside and outside your company. Inventory planners can be warned of potential shortages in time to find alternate supplies. Salespeople can be told of possible delivery delays caused by outside forces, giving them time to ask the customer if they want to use a different shipping method.

Accurate business intelligence at your fingertips puts you ahead of competitors stuck using their “tried and true” methods that are becoming increasingly worthless every day.

Final Thoughts

Effective inventory management comes down to data: knowing what you have and where it is.

A modern inventory control system that supports labels and barcodes lets you track raw materials, work-in-progress and finished goods simultaneously, with high accuracy.

An inventory system with business intelligence helps you find faster and alternate ways of obtaining raw materials and pre-made products, mainly when shipping delays occur. That information can help you get your products to your customers when needed, balancing everyone’s inventory.

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How a Pharma CDMO can manage the Serialization Challenge
How a Pharma CDMO can manage the Serialization Challenge 700 500 Xcelpros Team

At a Glance

  • Today, serialization has moved from being a luxury option to a necessity.
  • Pharmaceutical companies are hiring contract development and manufacturing organizations (CDMOs) to develop solutions that maintain drug quality while avoiding supply chain problems.
  • Pharmaceutical serialization lets manufacturers keep accurate track of their inventory wherever it may be.

As more pharmaceutical and chemical companies move to digitize their operations, they’re looking for ways to track raw materials and finished products through the manufacturing cycle. One way to track these products is through serialization.

“Serialization is the assigning of a predetermined coding type to each product item, assigning it a distinct identity” for tracking and tracing its location in the supply chain,” RFXcel.com states. A simple definition calls serialization, “the process of assigning a unique identity to each saleable product item,” according to Neurotags.com.

Pharmaceutical companies that have gone digital are starting to use serialization to track and trace their products throughout the supply chain. The industry is constantly looking to improve its tracking systems to combat counterfeiting, theft, packaging and storage errors. Companies are also worried about their products being altered after leaving their plants.

Pharmaceutical companies often hire contract development and manufacturing organizations (CDMOs). Using digital labeling methods such as barcodes and QR codes (a type of barcode) helps serialize the supply chain, making tracking raw materials and finished goods easier.

30-40% of all medicines circulated in the developing countries are counterfeit.
5-7% of all medicines circulated in the developed countries are fake. Source: WHO Report

Counterfeit drugs pose a serious threat to the public’s health. They also damage the reputations of legitimate companies and the pharmaceutical industry globally.

CDMOs worldwide face challenges when implementing a robust pharma serialization solution. Streamlining manufacturing and distribution processes while understanding their client’s unique requirements is challenging.

Serialization Challenges Faced by CDMO

Some of the challenges a CDMO faces while implementing pharmaceutical serialization for track and trace functionality include:

Seamless Serialization for Multiple Clients

CDMOs typically prefer to operate globally, providing comprehensive drug manufacturing and supply services to many pharmaceutical companies. Catering to a diverse client base has its unique set of challenges, especially when it comes to the serialization of individual drugs.

CDMOs need to equip themselves with the right technology to be able to modify their production or manufacturing lines and seamlessly label multiple drugs for different clients.

Regional Compliance

Every country around the world can have different regulations for exporting drugs. Labeling—or serialization—is part of that compliance. CDMOs are expected to take responsibility in terms of drug quality of drugs and compliance with various government rules. Being in compliance is challenging for CDMOs, especially considering the volume of information required to achieve it.

Figure: 1Key Serialization Challenges Faced by CDMOs

Key Serialization Challenges Faced by CDMOs

Picking the Right Labelling Solution

When it comes to drug serialization, a “one size fits all” approach to labeling solutions doesn’t always work. Assuming a CDMO has a preferred labeling software, there’s still the important decision of choosing:

  • Printer types such as thermal inkjet, thermal transfer, lasers
  • Printing materials such as paper, film or holograms
  • Special formulas to make counterfeiting harder

In terms of label design, everything must meet government codes and regulations. This applies to label layout, orientation, barcode configuration and other design elements. Every label must be printed in time to avoid delaying shipments. CDMOs are pressured to make the right choices for coding and labeling products.

Understanding Market Requirements

While larger pharmaceutical manufacturing companies use an in-house team of analysts and marketing specialists, smaller firms often rely on CDMOs for market intelligence.

When it comes to labelling client drugs, CDMOs need to understand the different markets and their requirements. Using market analysis, CDMOs must decide how many drugs need to be labelled for a particular market, including whether they’re choosing to label randomly or with a centralized approach.

Get Started to learn more about Pharma, request a consultation. CDMOs Can Handle All of Your Business’s Serialization Needs

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Overcoming Serialization Challenges

No two CDMO clients are the same and neither are the challenges each CDMO faces. In terms of how each company deals with its serialization issues, they should consider:

  • Equipping their workforce with the technical knowledge and details of serialization hardware and software
  • Making use of advanced technological applications like Big Data, cloud computing, the Internet of Things (IoT and advanced analytics)
  • Understanding how enterprise resource planning (ERP) software, like the Microsoft Dynamics 365 line of modular product, can help them maintain and monitor client data

With the right software and people skilled in its use, a CDMO can manage multiple production lines while meeting drug production requirements for different clients.

Investing in the right partner with experts that understand global pharmaceutical regulations will help CDMOs label and locate their products no matter where they are in the world.

Since CDMOs are not only vendors but also producers, they need to be in constant contact with their clients and suppliers. This includes dealers, wholesalers, packagers and transporters. Using the right ERP will help them maintain transparency at every level while avoiding recalls or stock-outs.

CDMOs benefit by developing flexible templates for their serialization solutions. These templates serve as a blueprint for any pharmaceutical client. Making them flexible lets a CDMO adjust a process to meet the client’s requirements, saving time, effort and money.

Final Thoughts

Drug serialization and labelling pose several challenges for CDMOs around the world. However, managing these challenges is an excellent opportunity for an organization to show its technological skills. When a CDMO has the right team and solution, it can overcome any challenge.

Taking advantage of products like Microsoft’s Dynamics 365 suite of solutions gives pharmaceutical companies access to powerful tools. Included is a way to track serialization, such as customer onboarding and lot traceability to toll manufacturing, from start to finish.

Using a powerful and effective ERP to enhance serialization will help a CDMO combat counterfeiting and theft while ensuring government compliance. At the same time, good software can also help a CDMO establish a more efficient supply chain.

Meeting serialization requirements for pharmaceuticals pose many technical and skill-based challenges. CDMOs worldwide are constantly looking for more efficient ways to handle these challenges. Investing in the right partner can make a big difference.

With the help of cutting-edge applications, a skilled team and a systematic approach toward serialization, CDMOs can establish themselves as leading end-to-end manufacturing and distribution partners.

References: What Is a CDMO (and Why Do You Need One)

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Warehouse management techniques : Tips to increase efficiency
Warehouse management techniques : Tips to increase efficiency 700 500 Xcelpros Team

Introduction

Pharmaceutical and chemical manufacturing companies face greater risks when it comes to inventory control than some other industries. Why? Because some of the same chemicals used to make effective medicines can also create addictive street drugs. For example, ephedrine, which is used to treat breathing problems, is also an active ingredient in methamphetamine. The Food and Drug Administration has strict rules for companies making and distributing drugs. All companies, especially those in the pharmaceutical sector, want to run their warehouses efficiently. Common efficient warehouse management includes:

  • Maximizing and optimizing all available space
  • Keeping inventory to lean levels
  • 50% of enterprises spend more than $1.2 million each year on cloud services
  • Using inventory tracking technology efficiently
  • Organizing the workforce so its time is used wisely

Warehouse management best practices also emphasize the “3 C’s”: control, coordination and communication. Standard practices, where control is maintained by only one department, usually results in difficult coordination and communication between departments such as sales and finance.

Enterprise resource management (ERP) software with warehouse management and inventory control modules can help manage warehouse inventory.

Maximizing Warehouse Space

Maximizing warehouse space includes stacking items logically, and using vertical space to your advantage.

The Centers for Disease Control (CDC) suggests hazardous chemicals be labeled with hazard warnings and the chemical name. Other chemical storage tips from the CDC include:

  • Keeping all stored chemicals, especially flammable liquids, away from direct sunlight and heat.
  • Keeping like chemicals together and away from those that might cause a reaction if mixed.
  • Storing liquids in unbreakable or double-contained packaging.
  • Storing flammable materials, acids and highly toxic or controlled materials in dedicated cabinets designed for those purposes.
  • Storing volatile and odorous chemicals in a ventilated cabinet.
  • Keeping all unused or empty compressed gas cylinders in a dedicated storage area.

Figure: 1Maximizing Warehouse Space

ERPs and Inventory Management Techniques

Use ERP to Run Lean

ERP software often includes warehouse management tools and technology designed to help companies balance inventories with current and future needs.

For example, warehouse management is integrated into Microsoft Dynamics 365’s Supply Chain Management. There’s even a connected Warehousing app available on the Google Play Store and Windows store that connects cellphones and other mobile devices to the network running D365’s Supply Chain Management. Each device must have its own copy of the app and be configured to connect to the local warehouse computer network.

Microsoft’s warehouse management module apps let workers use their cellphones, tablets or other connected devices to perform activities such as:

  • Printing and reprinting labels
  • Generating license plate numbers, confirming item types and quantities on a license plate or pallet and splitting full license plates
  • Starting production orders
  • Get information about particular items in a location

These warehouse management software settings can be configured to allow users different permissions in different warehouse locations. Software such as Microsoft Intune is used to mass deploy settings and service warehouse mobile devices.

Once devices are configured, cellphone cameras can be used to scan many common barcodes, including QR codes.

Another important part of the warehouse management module is the Transportation Management function. It lets workers register when a driver arrives, noting the driver’s name and license number, tractor and trailer number plus the location in the warehouse (e.g., Receiving Bay 1, Shipping Bay 3, etc.).

A key function for the pharmaceutical industry is setting work audit templates to interrupt an inbound order. Since many medicines require strict environmental controls, workers can be prompted through the audit template to check the temperature in delivery containers. They can then be told to check a particular container at a particular point in the receiving process.

Another method of boosting efficiency and controlling warehouse inventory is by requiring warehouse workers to confirm the product, location or quantity when they pick items. This reduces the likelihood of inventory errors caused by inaccurate counts.

Improving Efficiency With an ERP

When IDC conducted its 2018 survey, 45% of independent service vendor customers preferred the lift and shift cloud migration method for moving business applications. Combined with cloud computing, 69% of end customers understand the positive implications of using cloud-based software. These include agility, scalability, cost effectiveness, efficiency and others.

Is Cloud Computing Worth the Cost?

One reason many companies purchase an ERP is its ability to help them run their day to day operations more efficiently. One example is the ability to use an intelligent warehouse management system to cluster purchase order putaways. Workers put away products in a specific area and then pick multiple license plates at once before putting them away in different locations.

In a related activity, workers can check incoming product quality before technically receiving it and taking ownership of it. D365’s Warehouse Management module lets users log these checks with mobile devices.

This same intelligent warehouse management system also lets pharmaceutical companies efficiently process purchase order returns. The item is entered into Supply Chain Management and then scanned, starting the process. Items being returned are picked and sent through the warehouse process using mobile devices. The software also creates the shipment and load.

Similar configuration settings help inventory, procurement and delivery management become more efficient. Workers are no longer moving randomly from place to place within a warehouse, picking items from six different locations for a single order. Instead, they might pick items for six different license plates from the same general location, move to a second spot and add additional items. By using this method, each worker’s time is used to maximize the amount of actual work done, achieving more production.

ERPs and Inventory Management Techniques

Six of the most common inventory management techniques are:

  • Bulk shipments
  • ABC Inventory Management
  • Backorders
  • Just in Time (JIT) shipping
  • Consignments
  • Cycle counting

An innovative warehouse management system helps executives decide when buying in bulk is appropriate and when going lean is better. How? By sharing data with sales, finance and other departments. Warehouse managers can see what sales are coming up and know what raw materials to order.

The same situation applies to deciding what to produce and what to have in inventory based on importance. Data shared between systems lets managers make and adjust these calculations.

Backorders are becoming more common as Covid-19 related issues delay raw material shipments. While using them is a common warehouse management technique, effective ERP software helps firms control backorders and order materials from alternate suppliers.

Just In Time (JIT) inventory management reduces the amount of stock available at any given time to the bare minimum. Using D365 Supply Chain Management lets chief executive officers understand the complete supply chain. They can decide what items to get only when needed and what to buy in bulk.

Combined with precise inventory tracking to know when a specific medication is approaching its expiration date, pharmaceutical manufacturers can use consignment selling with confidence. Alerts will let them know when they need to refresh a seller’s stock.

Cycle counting, where workers count only a small quantity of product, is rendered nearly obsolete by an ERP. Using barcodes and electronic scanners, warehouse managers have an accurate idea of inventory at all times.

The Future of Warehouse Management

The future of warehouse management systems isn’t workers running around with pencils and clipboards. Instead, it’s automating many manual processes with real-time access to critical data.

“Warehouses will be built on current effective process-driven technologies such as widespread supply chain automation, hyper-effective robotic technologies and yes, plenty of drones to go around,” 6 River Systems predicts.

Leading that charge will be artificial intelligence-enabled ERP software coupled with industrial internet of things (IIoT) sensors. This combination will enable pharmaceutical companies to more efficiently track materials as they run their businesses.

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