Thursday, October 13, 2016

What you can learn from a walk round the warehouse

The picture given by the state of a company's warehouse can reveal more than the management accounts.

A lot of mistakes end up in a warehouse. Products that didn't sell in the numbers expected for example. Are the best sellers in stock, or is there just an empty space where they should be? Look at the labels to see where the goods are being shipped to. Why are some covered in dust - have they been there a long time? Then ask the warehouse manager which stuff moves off the shelf quickest. And in the LA  warehouse why were there so many garbage cans in stock? The company wasn't in the hardware business, but the presidents wife was!

The order book had plenty of surprises of its own.  Some of the products I  had reviewed in the R & D labs - major new lighting controls were booked as sold. Controls were the exciting front end to a load of boring looking dimmer racks. Some jobs had been booked in twice and one project listed under 3 different aliases. It was interesting that the president's renumeration had a bonus clause based on bookings, not sales! It was that Enron business model all over again.

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