Market volatility has made efficient resource management a must for business sustainability. Among the many operational challenges, shrinkage appears as a critical factor that erodes profitability margins in organizations with complex logistics operations. This phenomenon, whose initial impact may seem marginal, represents a determining variable that, without adequate control strategies, can severely compromise the economic viability and competitive position of your company.
The economic impact of shrinkage in the supply chain
Shrinkage is the depreciation in value of inventories that occurs in the storage environment. This phenomenon, caused by multiple causal factors, can manifest itself in various stages of the logistics flow, essentially representing the quantifiable gap between the accounting record of stocks and the physical evidence of stored products.
These losses represent a direct economic impact, additionally triggering a multiplying effect that compromises the integral operational integrity. According to specialized industry studies, the average warehouse experiences an inventory shrinkage of 0.2%, establishing a critical alert threshold when this indicator exceeds 0.46%. This percentage magnitude, apparently discrete in isolated analyses, translates into significant financial impacts when projected on a full operational scale. (Blog - Mecalux)
Strategic classification of shrinkage
To implement effective solutions, it is essential to understand the taxonomy of shrinkage that affects your logistics operation:
- Known shrinkage: This is a documented loss whose cause is known, so it may be due to damage, expiration or operational errors. This allows implementing corrective actions and improving inventory management (Blog - Llego).
- Unknown shrinkage: "It is that which has no immediate record or clear cause, so it usually goes unnoticed. This may be due to theft, administrative errors or failures in stock control, which makes it difficult to detect and correct (Blog - Llego).
- Technical shrinkage: "It is that which occurs due to inefficiencies in production processes or technical failures in machinery. These losses can be the result of a bad adjustment in a cutting machine, a defect in the packaging equipment or problems in the production line (Artícle - WauTecnologies).
The lack of control over these losses can generate interruptions in the supply chain and affect the company's image in the market, highlighting the critical need to implement effective monitoring and control systems.
Advanced strategies for inventory optimization
The implementation of specific methodologies for shrinkage control is a strategic investment with a high return for your organization. The following are the most effective techniques based on research and empirical evidence:
- Integration of disruptive technologies.
Shrinkage control is an essential practice in production management that seeks to minimize waste generated during production processes. This control allows companies to identify, analyze and reduce losses, thus optimizing efficiency and costs. (Artícle - WauTecnologies)
The implementation of advanced technological solutions enables precise inventory control and significantly reduces operational errors. Among the most effective tools are
- Radio-frequency identification systems (RFID).
- Warehouse management platforms (WMS)
- IoT sensors for monitoring critical variables
- Automated Storage and Retrieval Systems (AS/RS)
Automation in the logistics sector is one of the most valued solutions for companies to make warehouse work more effective, profitable and productive (Blog - Solistica).
- Intelligent warehouse layout design
A well-planned warehouse layout can radically improve operational efficiency. Some advanced techniques include: goods flow analysis to optimize product layout, implementation of flexible and adaptable storage systems, and use of simulation software to test different layout configurations (Blog - Solistica).
The spatial configuration of your warehouse determines the efficiency of workflows, minimizes handling times and significantly reduces the risks of damage during the logistics process. Optimizing the warehouse layout is a way to maximize space and facilitate the operations carried out in the logistics facility. (Blog - Mecalux)
- Metrics and control indicators
To effectively manage what is accurately measured, it is essential to implement specific KPIs that allow you to evaluate the performance and effectiveness of the strategies implemented.
Key Performance Indicators (KPIs) are essential for measuring, analyzing and continuously improving logistics processes. A data-driven approach enables companies to identify areas for improvement and make informed decisions (Blog - Solistica).
Among the most relevant indicators for shrinkage control are:
- Percentage of shrinkage: "Shrinkage = (Initial quantity of product - Final quantity of product) / Initial quantity of product x 100".
- Cost per unit stocked: Evaluates the economic impact of storage.
- Order fulfillment rate: Measures the efficiency of the logistics process.
- Inventory turnover rate: Indicates the speed with which stock is renewed.
- Inventory accuracy: Evaluates the correspondence between records and physical stock.
- Specialized training of human capital
The human factor continues to be a determining factor in the effective reduction of shrinkage. A properly trained team is an effective barrier against operational losses.
Having a well-trained team helps minimize handling errors, ensuring proper product handling and reducing waste. It also improves organization in warehousing and optimizes distribution, avoiding losses and ensuring a more efficient operation (Blog - Llego).
Digital transformation in the supply chain: the Solistica approach.
Solistica has developed an integrated logistics complex that comprehensively addresses the challenges of shrink management, positioning itself as a benchmark in the implementation of advanced technological solutions.
Solistica, with its innovative vision and commitment to excellence, is positioned as a key player in the industry, offering logistics solutions that address the specific challenges of this sector. The company has the agility to adjust its transportation resources according to changes in demand levels, enabling them to respond effectively to market fluctuations (Blog - Solistica).
Innovative solutions implemented by Solistica include:
- Intelligent routing technology: Intelligent routing technology enables efficient route planning, minimizing distance traveled and delivery times. This reduces operating costs, while lowering environmental impact by reducing carbon emissions.
- Active occurrence management: Solistica addresses this challenge with active occurrence and schedule management, ensuring that any unforeseen events or changes in circumstances are addressed in a timely and effective manner. This ensures that products are delivered on time and in optimal condition, keeping customer satisfaction a top priority.
- Artificial intelligence and advanced analytics: Artificial intelligence and advanced analytics work in the background to closely analyze big data using algorithms and predictive methods. Solistica leverages these tools to make data-driven decisions, anticipating market trends and optimizing its operations accordingly. (Blog - Solistica) (Blog - Solistica)
Empower your supply chain with Solistica
Optimizing resources and minimizing waste are indispensable competitive advantages. Implementing effective control strategies reduces direct economic losses, enhances operational efficiency, improves customer satisfaction and strengthens your market positioning.
At Solistica, we are experts in implementing state-of-the-art logistics solutions perfectly tailored to the specific needs of your business. From advanced warehousing systems to high-precision distribution strategies, our team of professionals is ready to help you optimize every aspect of your supply chain, reducing waste and maximizing results.
Contact us and find out how we can boost your organization's success through our comprehensive and customized logistics solutions.
