skip to Main Content

Inventory – A Historical Perspective

Inventory Optimization & Management  
In the earliest points in human history, as our earliest people became hunter-gatherers, there had to be some inventory management. Hunters developed crude wood and flint weapons to make their hunts easier. The first rudimentary inventory management followed pretty quickly. How many pointed wooden spears did one need? How many should one carry on a hunt?

How about arrows and arrowheads did one need? How many should one carry? They will inevitably break or be lost? How many should be in reserve back at the hut or cave?

How about flint? Did it make sense to keep a stock of flint stones in the corner of the cave to convert to arrowheads, spearheads, or knives as needed? Or did it make sense to keep a reserve of the finished goods? How big did the pile get before the cave spouse began to complain about cleaning up that excess?

With the advent of fire, the gathering and storage of fuel became a concern especially in climates that had four seasons or significant rainy seasons. How much wood to store to provide an adequate supply during the winter or rainy season? Where to store it to keep it dry? The best of our ancestors probably even developed a rudimentary FIFO so they were always using the oldest and most seasoned wood first.

Let’s fast forward all the way to the time of Charles Dickens (1812-1870). At this time of year one can easily watch any number of makes and re-makes of his famous novelette A Christmas Carol. Inventory management and A Christmas Carol? Well yes. While it is not central to the story, young Ebenezer Scrooge apprenticed at the warehouse of one Mr. Fezziwig. Scrooge’s sour disposition was probably due in part to his inability to forecast accurately, manage his working capital, and still provide good customer service. Bah Humbug!

Inventory management is nothing new. It was probably just simpler because of the very small number of items to store and plan around. It drove Scrooge crazy and what could possibly have been stored in Old Fezziwig’s Warehouse 50 maybe 100 SKUs?

Anyone can manage 1 item. That is not so hard and a shortage here or an over stock there will not cripple one’s pocketbook. Effectively managing 500, 5,000, or 50,000 SKUs…. Well, that requires disciplined and intelligent professionals operating within well defined business processes integrated with state of the art software for Demand Planning, Materials Resource Planning, Warehouse Management, and Order Management.

We wish everyone a 2009 of health, happiness, and optimized Inventory Management for one and all.

Related Articles

6 Questions that will Improve Your Capacity Planning Strategy

Capacity planning has always been a core strategic process in the manufacturing industries' quest to meet the demand of customers in a timely and efficient manner. Having accurate insight into your plant’s production capacity within specific durations of time while [...]

Are you effectively managing your inventory?

Inventory management is essential in today's industries.  Poor inventory management can lead to a lot of problems such as too much inventory, disorganization, or low product turnover. Avoiding these issues can save your business time and money.  CGN said, "Fast paced [...]

What every beginner warehouse owner should know

There are a few strategies and techniques that every new warehouse owner should be aware of. On the top of that list is inventory management! After all, inventory is the reason we have warehouses.  While it might seem like common [...]

Should you be using inventory optimization software?

Should you be using inventory optimization software? Which types of businesses would benefit from it? The answer is probably and most of them. Tech Target said, “Companies implement and use inventory optimization software because they realize that inventory, although necessary, [...]

Calculating Safety Stock: Simpler Might Not be Better

What is safety stock? Safety stock is the extra stock you maintain to mitigate the risk of running out of raw materials or finished goods due to uncertainties in supply or demand. The purpose of safety stock is to ensure [...]

Nine Factors That Influence Inventory Planning and Optimization

Inventory planning is hard to do. As supply chain complexity continues to expand, it’s getting more and more difficult to reach and sustain optimal inventory levels. Regardless of the level of difficulty, however, inventory must be managed, and the rewards [...]

Make the Transition to Inventory Forecasting Software

Maintaining the right amount of inventory is key to keeping up with the ebb and flow of customer orders. But what level is the “right” level? If a company doesn’t have enough product on hand, it may miss too many [...]

The Importance of Effectively Managing Raw Materials Inventory

In today’s world, the system of vendors, activity, and data required to source, produce, and deliver products to customers is increasingly complex. And the supply chain represents the steps required to make this happen. But as product companies extend their [...]

Effective warehouse and inventory management tips

Warehouse inventory management is one thing that can have a big impact on productivity. All Things Supply Chain put together a list of 9 ways you can better manage your inventory. First things first, plan your space. As they said, [...]

The Future of Inventory Management: Five Predictions

For many companies, inventory management is where all the elements of the supply chain converge. Inventory may be seen as the bloodstream of any competitive business. Its unobstructed flow is critical to the well being of any organization that trades [...]
Subscribe to our Blog
Back To Top