Using ABC Analysis for Warehouse Management: A Case Study of Seree Karnchang Buddhanimit Foundry

Abstract

This study aimed to propose an alternate warehouse management strategy for the Seree Karnchang Buddhanimit foundry. Due to limited storage and a lack of procedures to keep stock, the ABC Analysis method of warehouse management was used to make improvements, and two alternative warehouse management strategies were proposed: 1) A management plan that considered the number of sales could reduce inventory by 785 items and a reduced cost of inventory 1,304,906 Baht 2) An approach that analyzed sales value, which was able to reduce inventory by 823 items, representing a discounted cost of inventory of 1,408,037 Baht.  The management strategy that analyzes the distribution volume is one that better serves the requirements of the customers. Following modification, the inventory slipped by 42% of the total number of parts and the cost of the inventory fell by 44%. Then, 5S actions were implemented to make the warehouse environment more conducive to staff productivity. The area was cleaned and easier to inventory control.