Inventory tracking is an important aspect of Inventory control. Irrespective of the type of inventory you are handling, it is important to have an efficient tracking system in place in order to maintain effective inventory control and avoid stock-outs. While there are a lot of dynamics that goes behind that, Inventory Serialization is often an obscure one.
What is inventory serialization?
Inventory Serialization is tracking of individual units of inventory using serial numbers. Expensive inventory that requires recurring servicing and comes with high-liability are tracked by the help of inventory serialization.
On the other hand, homogenous inventory units are generally tracked by SKU codes.
For example, Smartphones are tracked using a special type of serial numbers called the IMEI. Even when the models are same, no two smartphones have the same IMEI number. It is important as each phone will be owned by a specific individual. Considering that events of repairs, troubleshooting, criminal investigation etc, may arise. This is when inventory serialization is useful.
Unlike SKUs that do not differentiate between similar products, serialized inventory will allow identifying the critical aspects of the device and the actions required further. Same goes a pistol or any firearm.
So what are the major factors that make inventory serialization important and why should sellers care?
Determine product ownership-
We have already mentioned a use case of inventory serialization for smartphones. Companies frequently use serial numbers to track the owner of the product. This is done in the event of a theft, repair or some form of troubleshooting.
Product ownership determination is also applicable while selling firearms. It becomes easy for authorities to track the owners of the firearms if required to do so.
This is one of the most valuable uses of inventory serialization. Imagine a defective component placed in the engines of a top-selling car and distributed to multiple locations. Such scenarios are outright nightmares for companies and this is where the Vehicle identification number (a form of a serial number) helps aggregate the products in a methodical manner for recall and saves your brand from irreversible damages.
Determine guarantees and warranties-
Guarantees and warranties always come with a predefined time period. Also, different product batches will have a different start and end time of their respective warranties. Serialization aids in the proper identification of these certificates to help retailers manage the entire process with ease.
Uphold and maintain quality control-
Quality control is an important aspect of manufacturing that needs regular monitoring. In case of anomalies, where manufactured items cross the UCL or LCL, the quality control team can track the defective pieces using the respective serial numbers. The process becomes a whole lot easier with an inventory software that allows serialized tracking.
Process improvement aims to increase the production capacity and decrease costs of a company without investing an additional amount of resources. Manufacturing companies are always looking to better their processes and in order to do that serialized inventory helps a lot by real-time tracking of the concerned product.
When should inventory serialization be avoided?
You should avoid inventory serialization for homogenous products that are cheap. In such scenarios, there is no need to identify each and every unit of inventory.
If the item produced does not come with some underlying liability with respect to its usage then it is not necessary to determine the ownership as well. In such cases, inventory serialization is not required.
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