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Inventory & Supply ChainMay 18, 2024Himanshu Bhati· BD Head - India, Facto7 min read

The Stockout That Cost a Day's Production, and the Inventory Fix That Followed

A single missing box of fasteners halted a line for a full shift. Here's how one unit moved from gut-feel stock control to real-time inventory tracking, and freed up working capital along the way.

A long warehouse aisle stacked high with inventory on racks
Article · 7 min read

It started with a box that wasn't there. A fastener unit in Ludhiana had a full order ready to assemble, except for one specification of bolt the system swore was in stock. It wasn't. The line sat idle for a shift while someone drove across town to buy at retail price. The order shipped late, and the customer remembered.

Here's the maddening part. On paper, they had plenty of inventory. They had too much of almost everything, except the one thing they needed that day. That's how gut-feel stock control usually goes: cash tied up all over the place, and shortages exactly where they hurt.

Why "we know our stock" is usually wrong

When stock lives in a register and three people's heads, it drifts from reality a little more every day. A part gets borrowed from one job for another. A return never gets logged. By month-end, the book figure and what's actually on the rack have nothing to do with each other.

Rolls of steel raw material stored in a dark warehouse
Raw material sitting as dead stock earns nothing. It's working capital parked on a shelf.

What they changed

Nothing exotic. Barcoded bins, a scan at every issue and receipt, and automatic reorder alerts when an item hit its minimum level. The real shift was cultural rather than technical: stock got updated as it moved, instead of being reconciled once a month in a panic.

Working capital tied up in inventory (₹ lakh)
Before₹84L
After 5 months₹53L

The reorder alerts ended the firefighting. Critical fast-movers got flagged before they ran out, so the panic retail runs stopped. At the same time, slow-moving dead stock finally became visible, and they stopped re-buying things they already had buried at the back.

"We thought we had an inventory problem. What we really had was no idea what was sitting on our own racks."Fastener manufacturer, Ludhiana
₹31Lworking capital freed up
0line-halting stockouts since
2.4ximprovement in inventory turns

Where to start if your stock lives in a register

Don't try to digitize everything on day one. Start with your top 20 items by value and by movement: the ones that cause shortages and the ones that hoard cash. Get those onto real-time tracking with a proper reorder-level automation that prevents stockouts, calculated from your real usage and lead times. That one step takes away most of the pain for a fraction of the effort. Freeing up that trapped cash is the same fight as fixing your receivables.

See it in action

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