Automate Inventory Management With The Smartphones, Cloud, QR Codes

Modern Technologies That Help With The Inventory Management Automation

Mobile devices (smartphones, tablets, mobile computers) coupled with the QR codes or RF tags (NFC, bluetooth, RFID) help you automate inventory management process, make it efficient, error-free and real time. Using mobile devices and QR codes or RF tags company employees can record inventory transactions in the field in real time by simply scanning QR codes or RF tags with a smartphone. Tracking inventory using smartphones for QR code scanning and data entry gives you an accurate inventory stock and movement picture, and also saves you money on purchasing a barcode scanning hardware.
In a previous article we described how businesses can efficiently manage inventory and assets using QR Codes and smartphones. Here we want to share several tips and practical advice on how to implement mobile asset tracking system with the barcode / QR code scanning.

1. Inventory Tracking: SKU, Lot Number, Or Serial Number

Before you start setting up an inventory management system you need to decide how do you want to track your inventory, and how granular your inventory units should be. You can track inventory by SKU / part number (the same inventory items are represented by one inventory line item), lot or batch number (you have multiple inventory batches of the same line item with different properties that you want to track separately), or by serial number (tracking each inventory item individually). Initial inventory entry into the system and QR codes that you generate and print will depend on your decision, so you should make this decision early in the process.

If your main goal is to know current inventory stock in the warehouse and on the job sites, inventory usage and trends, and receive low inventory alerts - you should track inventory by SKU / part number. If you need inventory traceability you will need to separate inventory line items in batches, and track each batch separately using lot number / batch number. If you are tracking valuable assets, like work tools or equipment, and need to track each unit sepaartely - track them by serial number.

Tracking inventory by SKU / part number is usually done for the generic materials and supplies. This is something that you buy and use for the projects or sell to the customers, and that does not require traceability.
Tracking inventory by SKU is the simplest situation, but if you require inventory traceability this is not enough. For traceability you will need to track batches / lots of the same inventory item separately, be able to tell each lot history, how it was used and where each lot or a final product was distributed. You also should be able to record and retreive lot specific information, such as production date, vendor, expiration date, etc. If this is the case, you need to separate inventory line items into batches, assign a unique lot number to each batch, and track inventory by the lot number.

Finally, when you are dealing with the valuable assets, such as work tools or equipment, you normally want to track each item separately. You want to know the location, usage history, maintenance and repair history of each individual unit. If this is the case, you need to track these items by serial number.

As a rule, you will have inventory of several types, and this is fine. You can track generic materials and upplies by SKU, inventory that requires traceability by lot number, and assets, such as tools or equipment - by serial number.

2. Printing QR Code Labels And Tags For Assets And Inventory

You decision on how to track inventory will affect the way you are printing QR code labels. QR code label or tag should encode the ID / unique number for your lower level inventory units - SKU, lot number or serial number.

If you are tracking inventory by SKU, you can often re-use manufacturer's UPC barcodes if they are available. If inventory that you are using does not have manufacturer's barcodes, you do not necessarily need to label each individual inventory item. It is sufficient to print one QR code label and stick it on the container, bin or shelf in the warehouse where you keep an inventory line item.

If you are tracking inventory by lot number or serial number, most likely you will need to print QR code labels yourself, and label each inventory lot or serialized inventory item when you receive or produce it. The good news are - after you had labeled all of your existing assets, you will rarely need to print new QR codes. The need in new codes will arise only ocassionally when you receive a new asset.

When printing QR code labels for the inventory, you need to consider these factors:

3. Inventory Management Software For Tracking Inventory And Assets

In order to implement inventory management and / or asset tracking system using QR codes and smartphones you need a a mobile application for the QR codes scanning and field inventory tracking, a central database to keep inventory data in, and a web based software to review inventory reports. The web-based software and an inventory tracking mobile application work together: web-based software knows how to generate QR codes so that the mobile application could process it, and the mobile application knows what information and in what format it should send back to the web software.

It is important to note that you cannot download a generic QR code scanning application and expect it to do the job. Similarly, you cannot generate QR codes yourself using a free site and expect an inventory management mobile application to process it in the way you want. These generic QR code generation and scanning tools are mostly for encoding and reading back web site urls. For automation of the inventory management process you need a software and a mobile application that work together and were specifically created for the inventory management, such as QR Inventory software.

4. Initial Inventory Count And Data Entry

Once you decided on how to track your inventory, you will need to enter or import inventory / assets into the inventory management system, and current inventory stock. When you enter or import inventory items into the inventory management system, it is important to remember that you need a separate inventory line item with a unique ID for the most granular inventory unit you have. It may be a SKU, lot number or a serial number for the assets.

In order to track inventory stock and locations you need a starting point. Therefore, after inventory is entered or imported into a database and QR code labels are attached, the next step is to enter initial state of the assets and inventory. It may be current stock level in the different locations for inventory, current locations of the assets, and and data on the assets and inventory you need to keep track of. At this stage of the process, having an inventory management mobile applicationis is a big plus. Without a smartphone and a mobile application you would need to record inventory stock with a paper and pencil, and then manually enter these data into the inventory management software. With the QR code scanning mobile application you can scan QR codes or barcodes on the inventory, enter quantity and other required parameters, take photos - and collected data are instantly transferred to the central inventory database.

5. Inventory Transaction Types

For some companies, it is important to know current inventory stock in the warehouse, but there is no need to track inventory once it leaves the warehouse. It is usually true for the retail or wholesale businesses. You need to record inventory when you receive it in the warehouse, and then when it is sold. If this is the case, transactions in and out of the warehouse will be sufficient. These types of transactions are standard and are available in any inventory management software.

In other cases, however, you move inventory or assets between the warehouse, service trucks, job sites and employees, and you need to keep track of the inventory movements, current and historic locations. There are multiple examples of this situation: you may need to keep track of the office assets, leased equipment, equipment and assets that are in use on the remote job sites, and are moved from one site to another. If you are a service company, you may need to track inventory from the warehouse to the service van, know what inventory each technician has on-hand and what is installed on the client's site.

In this situation, it is important to also be able to transfer inventory between the different locations and employees, and be able to review inventory stock and assets list at any location or with any employee / client. Not all inventory management software products allow for inventory transfer, so you need to verify that this option is available if you need it. Some software systems will only have built-in transfer types (for example employee can check item in or out, but cannot transfer inventory to another employee, or to the location other then office or warehouse). Other inventory management systems, such as QR Inventory software, allows you to transfer assets and inventory between any location types as needed.

6. Ready To Go

After you decided how to organize your inventory, entered inventory and assets into the database, printed and attached QR code labels, entered initial inventory count, you are ready to go. An initial investment of time and money into organizing assets and inventory will pay off big time when your employees will not need to spend countless paid hours trying to manually reconcile inventory, your valuable assets won't get lost and you won't fail a project because you unexpectedly ran out of supplies or cannot locate necessary equipment.