Metals and Metrics: 

Understanding Why Inventory Software is for You.

Spreadsheets can get the job done but keep you from the growing technology that is affordable and better for business. Today, we will dive into why it’s important to know what you have in your warehouse and be able to seamlessly order, create, and sell your products with inventory management software.

• On-hand inventory
• Know what you have on order
• What costs you are facing
• Estimated completion time
• Have control of cost/shipping increases
• Be able to provide invoicing and payments
• Minimize and manage waste
• See all departments in a bigger picture
• Grow your business easier

1. On-Hand Inventory:

Running a metalworking business relies on having a precise understanding of the materials and products available at any moment. Inventory software allows you to maintain real-time visibility into your on-hand inventory. Having this information helps prevent production delays, avoid stockouts, and optimize resource allocation.

2. Know What You Have on Order:

Metalworking projects can involve complex supply chains with various components sourced from different suppliers. Inventory software aids in tracking the status of orders. You can better manage expectations with clients and coordinate your production schedules. This transparency minimizes the risk of overcommitting resources or experiencing delays due to unforeseen supply chain disruptions, which we know happens often.

3. What Costs You Are Facing:

Cost control is the foundation of profit and growth in the metalworking industry. Inventory software helps you track and manage costs associated with raw materials, labor, and other expenses. With a detailed breakdown of costs at your fingertips, you can make informed decisions, identify areas for cost savings, and ensure that your pricing strategies align with your financial goals.

4. Estimated Completion Time:

Project timelines are essential for customer satisfaction and project management. Inventory software provides tools for estimating completion times based on real-time data. Put time on your side by setting realistic client expectations and optimizing your production schedules for maximum efficiency.

5. Have Control of Cost/Shipping Increases:

The metalworking industry is susceptible to fluctuations in costs and shipping expenses. Inventory software provides a comprehensive overview of these factors, empowering you to identify trends and anticipate potential increases. With this foresight, you can proactively adjust pricing strategies, negotiate better terms with suppliers, and mitigate the impact of rising costs on your bottom line. 

6. Be Able to Provide Invoicing and Payments:

Streamlining financial processes can help maintain a healthy business. Inventory software lets you seamlessly generate accurate and timely invoices. This improves customer satisfaction and ensures that you receive payments promptly. Additionally, having inventory software helps with organized financial records for auditing and reporting purposes, which means no more headaches at tax time.

7. Minimize and Manage Waste:

Waste management is a growing concern in the metalworking industry. Inventory software can help minimize waste by providing insights into material usage and production efficiency. By tracking the consumption of raw materials and monitoring production processes, businesses can identify areas where waste can be reduced. This contributes to environmental sustainability and leads to cost savings by reducing the need for disposal. 

8. See All Departments in a Bigger Picture:

Metalworking companies often consist of multiple interconnected departments. Inventory software provides a centralized platform for monitoring and managing the activities of each department. This “bigger picture” view improves communication, collaboration, and coordination for your company. 

9. Grow Your Business Easier:

As your metalworking business expands, the complexity of managing inventory also increases. Inventory software is designed to scale with your company, offering the flexibility and adaptability needed for seamless growth. Investing in the right inventory management system lays the foundation for sustained expansion without compromising operational efficiency.

Hear from one of our experts, Dale Lathrop:

Dale is the training manager with SOS Inventory. In his ten years of working with inventory software, he has trained several metalworking companies needing help customizing SOS Inventory Software to their specific business.

Here are a few examples:

Company #1 works with screws, bolts, and nails. They buy large spools of steel wire at varying gauges. Each gauge of wire is an input component into a first-stage process based on the wire’s width. Plugs are processed in 3 different processes. There are multiple size outputs of plugs cut from the wire (1”, 2”, 2 ¼”, etc.). The inputs also include labor fees and tooling fees.

Company #2 produces sheet metal siding for housing. Flat sheets of metal are input and cut forms are produced, as well as the cut off waste (by the pound). Cut forms are input into another process to punch holes in the form. Punched forms are input into a forming stage to get the rippled housing plates. The final output is a formed sheet of various lengths to attach to buildings.

Company #3 does metal forming. Raw metals are purchased and accounted for by the pound or ton. They are heated and poured into molds to create different forms. A process transaction is used to create forms. Raw metal is input by weight, and labor and machining fees are also entered. Outputs are reused metals, waste metals, and forms.

Each of these companies has particular materials, processes, and needs. The right inventory software will give you the flexibility to make detailed changes specific to your business. Dale worked with these companies to get set up and headed toward success. What does customizing SOS Inventory look like? Here is an example:

Metal Finishing Service Company- They do estimates for customers and sales orders. Their customer sends the metal products, and then they go through stages of service: 1. receive, 2. unpack, 3. rack, 4. anodize, 5. dry, 6. quality control, 7. package, 8. ready for shipment.

This can be handled in 2 ways: Locations or Builds with work centers.

Locations:

• Add the following locations:
  • receive
  • unpack
  • rack
  • anodize
  • dry
  • quality control
  • package
  • ready for shipment

• Add a service item for the service they will perform for the customer.
• Create a serialized item.
• Create a generic vendor called “Customer Provided Parts.”

Sales:

• Add estimate.
• Once ready, convert the estimate to a sales order.
• When a customer sends in part, add the item receipt to receive the item into the “receive” location.
• Assign serial to identify the customer. 
• Go to the serial inventory list, print the barcode for the serial item, and then affix it to the item.
• As the item moves through the various stages, the user can add a transfer and scan the serial number into the system.
• Once the item has moved through the stages, the final process will be to create a shipment from the sales order. Ensuring they add the item, scan the serial to relieve it from inventory, and then invoice the sales order.

Builds/Work Centers:

• Add the work centers:
  • receive
  • unpack
  • rack
  • anodize
  • dry
  • quality control
  • package
  • ready for shipment

• Add a service item for the service they will perform for the customer.
• Create the Anodize station as an inventory item.  Set the quantity of this item as the number of times it can be used.
• Create a serialized item.
• Create a generic vendor called “Customer Provided Parts”

Sales:

• Add estimate.
• Once ready, convert the estimate to a sales order.
• When a customer sends in part, add the item receipt to receive the item and assign a serial to identify the customer.
• Go to the serial inventory list, print the barcode for the serial, and affix it to the item.

Production:

• Add a build transaction:
• Input item = serial item and qty 1 of the Anodize station item.
• Output item = serial item
• As the item moves through the various stages, the user can edit the build and change the work center.
• Once the work center moves to the Anodize station, add qty 1 of the Anodize station item. This will reduce the qty of that item.
• Once the item has moved through the stages (work centers), the completion of the build will process will be placing the build in finished goods.
• Then, create a shipment from the sales order, ensuring they add the item, scan the serial to relieve it from inventory, and then invoice the sales order.

As you can see, SOS Inventory puts the power into the hands of the company and gives many options to customize and create workflows that work specifically for you. If you have been on the fence about moving forward with an inventory software company, it’s time to go for it. 

If you are looking for an inventory software company to help navigate the complexities of the metalworking industry, SOS Inventory offers a 14-day free trial that includes training classes and support along the way. No credit card is required.