Ran out of Scratch Pads

We ran out of 10-packs of scratch pads at the Monk Office warehouse for a short time this week. This is not good. We are preparing for what is our busiest month of the year for office and school and art products. How can this happen?

Well, if we usually sell 100 or so in a month and a customer orders 1000, we could run out. (We may not though, if we are thinking ahead, we put in a special order for the 1000, let the customer know it may take an extra day, and then we don’t run out and we don’t ship the 1000 in two separate orders.)

Another way that we may run out is if we buy too few to meet normal demand or if vendors are delayed. (We should catch this too, and fill it in, before we run out).

Errors will cause us to run out of items too. Vendor errors, errors in receiving (i.e. we received 200 but really only get 20), in put away (i.e. we put them in the wrong place and can’t find them), in picking (we pick this item by mistake and send it out so we have fewer than we thought) or in counting. At Monk Office we have thousands of transactions and make very few errors. Our picked perfect percentages are measured to 3 decimal places!

What happened to cause us to run out of scratch pads?

Our records showed we had over 200 in stock, and when we went to pick them, there were none. This creates back orders. Customers get two deliveries instead of one. Drivers have to go twice to the same locations. The customer gets two invoices instead of one. Pickers have to pick 2 orders and shippers have to ship 2 orders. Some orders may have gone all the way up to Port Hardy, twice! A huge customer inconvenience and waste of resources. We investigated.

Almost 40 staff counted inventory on June 30. We pulled out the count sheets. A team of 2 staff counted 240 scratch pads. The count sheet said to count packs and the description says that there are 10 per pack. And, since this item changed from each to 10 packs in the Basics/ Monk catalogue in January 2010, there was a note on the shelf that says they are sold in 10-packs.

It is routine practice in counting inventory at Monk Office to recount items where the physical counts differ from the system count by more than $25. The difference on these scratch pads was more than $25 so a new team of two counted them again.

The second team also counted 240, rather than 24 10-packs. These items are easy to count, there are instructions to be careful of pack sizes and check on what quantity you should be counting. And we counted too many again!

This is one item out of 6000 or so we counted in the warehouse, so it is not an epidemic. Still, how do we reduce the likelihood of this happening again? More training? Less time pressure? Triple checking needed? This variance sheet had no names on it.