Two Bin Stock Control

Ostendo allows for the Two Bin / Kanban concept, typically used for low-value, high-volume items that still require stock control. This is different to full perpetual control, where inventory replenishment requirements are generated based on demand and supply, using re-order quantities, multiples, minimum levels, and history days.

High: volume, low-value items (e.g. consumables) are essential to manufacturing or jobbing environments and must never run out, as this could jeopardise the entire process. However, treating these items the same as higher-value inventory (full perpetual control) requires additional administration.

These consumable items may be backflushed to maintain stock on hand but need to be reordered via the Inventory Replenishment Routine to maintain adequate stock levels. Typically, these items are sourced locally and do not have long lead times.

Items marked as "Two-Bin" will beexcludedfrom the Inventory Replenishment and Order Inventory Availability functions. The re-ordering and issuing process is triggered when a bin is emptied via a new screen called "Two-Bin Replenishment."

The Two Bin concept uses two bins, one placed in front of the other. When the first bin is emptied, the second bin (which contains stock to cover typical demand over the item's supply lead time) moves to the first bin's position. The empty first bin triggers re-ordering of replacement product. When received, the stock goes into the empty bin and is placed behind the current bin.

This simple concept prevents the factory from running short of product and provides timely notice when more product is required. However, while this process simplifies re-ordering, it can potentially lead to higher stock holdings.

To reduce items from inventory, Ostendo currently allows:

Because Ostendo allows backflushing and manual issuing, these transactions must be considered when an empty bin is returned for reordering. We maintain a running total for each bin, determine what has been issued versus the bin quantity, and write off the difference as material usage with a type of "ISSUE."

Each physical bin is defined with its own quantity, which can default to the item's "Re-Order Qty" or use a specific override quantity. The issue warehouse and location for each bin is also required.

Although different locations can be defined for different bins, this is not required. When determining bin issues (upon return of empty bin), we examine total issues for the entire warehouse.

When an empty bin is returned for reordering, a user scans a barcode (or manually enters the bin barcode) into a new screen, which triggers:

Example Scenario

Item ABC

Bin Configuration:

When the operator with Bin 3 runs out of stock:

This triggers:

When the operator with Bin 1 runs out of stock:

This triggers the same three processes as Scenario 1, but for the 500-unit quantity specific to Bin 1.