Minimum Maximum Inventory Method
What is the Min/Max Inventory Method?
The Min/Max inventory system is a basic reordering system that is one of the most simple inventory management techniques to deploy. However, because of this simplicity, the Min/Max system many not always produce accurate results since it’s very difficult to track inventory levels manually, leaving you with excess inventory, or even a shortage. The Minimum Maximum inventory method is ideal for companies that have cyclical demand for their products. In fact, many companies that use the just-in-time inventory method would be better off using the Min/Max method, especially if they have cyclical or infrequent demand.
To implement the Min/Max inventory system, you must determine the maximum quantity of an item to have in stock at all times, along with the minimum amount to reorder an item. The ideal amount of inventory, often referred to as EOQ (Economic Order Quantity), lies somewhere between the minimum and maximum levels. The Min/Max settings may be continuously adjusted to optimize inventory performance.
To implement an effective Min/Max mthod, it is necessary to manage it with an inventory control solution like TRXio. TRXio assigns values to each product, including a “Min” (Minimum) setting to alert designated users when the item’s quantity at the specified location falls below the amount entered. TRXio’s “Max” (Maximum) setting alerts users when there is an excess of supply of an item at a specified location. TRXio also has a “Reorder” setting that sends an alert when supply reaches an exact point, providing ample notice to reorder more inventory before the quantity falls below the Min value.
TRXio sends daily Min, Max, and Reorder email alerts when a product’s supply at a certain location falls below, meets, or exceeds the designated numbers. TRXio also has the ability to generate a Minimum/Maximum Report, which collects and displays information concerning products that have minimum, maximum, and reorder values to them. With this report, a general overview of status of various products can be seen, and it can also quickly show a user if the item is below its minimum value, above it maximum, or at its reorder point.
TRXio users: are you using TRXio’s Min/Max settings, email alerts, or reports? To learn how to set them up, visit the “support” tab in the TRXio system. There are tutorials on, “How to Set Up Min/Max,” What are Min/Max Settings?,” “Inventory Min/Max,” and “How-To Enable Min/Max Notifications.”
For more information on TRXio’s Min/Max functions, or regarding using the Min Max method, please contact us at 844-868-7225 or click on the demo button below.