Improving inventory management when factory production slows
There were more signs of an economic slowdown as the Commerce Department released a new report about factory production this week.
The number of new orders for factory goods fell 0.6 percent in April. This is the second straight month (and the third time in four months) that factory orders have fallen. Demand for factory goods is seen as a key indicator of the economy.
"We're in a period now where the economy is cooling," economist Robert Dye told Bloomberg. "Businesses are getting more defensive as they think about the uncertainty they face the rest of this year."
As consumer demand has decreased, it is likely that companies will closely examine their inventory levels and warehouse management practices. Businesses have been stockpiling goods in recent months. Inventories of manufactured durable goods have gone up 26 of the last 28 months. They have reached a record high of $364.1 billion, according to the Commerce Department.
Firms looking to save could take a holistic approach to their inventory through a partnership with a contract logistics specialist. Organizations that improve their order fulfillment process and streamline their distribution are likely to see increased profit margins and efficiency, helping them to be more competitive as the market slows.
The number of new orders for factory goods fell 0.6 percent in April. This is the second straight month (and the third time in four months) that factory orders have fallen. Demand for factory goods is seen as a key indicator of the economy.
"We're in a period now where the economy is cooling," economist Robert Dye told Bloomberg. "Businesses are getting more defensive as they think about the uncertainty they face the rest of this year."
As consumer demand has decreased, it is likely that companies will closely examine their inventory levels and warehouse management practices. Businesses have been stockpiling goods in recent months. Inventories of manufactured durable goods have gone up 26 of the last 28 months. They have reached a record high of $364.1 billion, according to the Commerce Department.
Firms looking to save could take a holistic approach to their inventory through a partnership with a contract logistics specialist. Organizations that improve their order fulfillment process and streamline their distribution are likely to see increased profit margins and efficiency, helping them to be more competitive as the market slows.
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File Under: Distribution & Warehousing