Inventory Management in the Chemical Industry
Posted: Mon Mar 04, 2019 11:11 pm
The chemical industry is a vast and diverse industry, comprising of various sectors. Within the chemical industry, there are various chemicals, raw materials and feedstocks that get stacked up in the warehouses. This unused chemical stock eats up your storage space and your investment. In the production areas of the industry, there is many old, unused and used equipment, such as forklifts, packaging logistics and materials which clutter factories. The effective ways for leveraging your excess chemical stocks and used equipment will be discussed in the further sections.
Why Excess/Surplus Stocks?
As a manufacturer of chemicals or chemical products and equipment, you normally procure your input raw material in advance, and usually, some of it remains as balance in your storeroom and equipment is not needed after its use. When the production is not planned properly, you end up with excess stock. At times, for some of your chemical products, market demand suddenly fluctuates or slows down. This results in slow-moving chemical stocks or non-moving chemical stocks.
For various reasons, such as a change in product design, change in order specifications or change in requirements of customers, some of the ordered chemical products and even already manufactured products would remain unused for a very long time as well as may never be used and eventually end up as dead stock for your production. Similarly, this could even happen if you are a supplier or a distributor and have been carrying large stocks of various chemicals and equipment in anticipation of future customer demands.
Why Excess/Surplus Stocks?
As a manufacturer of chemicals or chemical products and equipment, you normally procure your input raw material in advance, and usually, some of it remains as balance in your storeroom and equipment is not needed after its use. When the production is not planned properly, you end up with excess stock. At times, for some of your chemical products, market demand suddenly fluctuates or slows down. This results in slow-moving chemical stocks or non-moving chemical stocks.
For various reasons, such as a change in product design, change in order specifications or change in requirements of customers, some of the ordered chemical products and even already manufactured products would remain unused for a very long time as well as may never be used and eventually end up as dead stock for your production. Similarly, this could even happen if you are a supplier or a distributor and have been carrying large stocks of various chemicals and equipment in anticipation of future customer demands.