International Door & Operator Industry

MAR-APR 2018

Garage door industry magazine for garage door dealers, garage door manufacturers, garage door distributors, garage door installers, loading docks, garage door operators and openers, gates, and tools for the door industry.

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Page 30 of 142

28 International Door & Operator Industryâ„¢ MANAGEMENT Continued from page 27 Continued on page 31 low morale stifles emotional commitment to the job and ultimately, employee motivation. Taking inventory within a clean, well-organized and systemized warehouse is easy. Conversely, taking an accurate inventory in a messy warehouse is difficult. Often, dealership owners possessing a cluttered, disorganized warehouse do not take an inventory at all, seeing the process as futile. Unlike well-managed dealerships, firms that chose not to take an inventory simply are unable to verify the profitability or lack of profitability of the firm at yearend. Taking inventory is the key ingredient to determining material used for the period be it a year, quarter or month. The formula for calculating material used is shown below: Beginning Inventory + Purchases - Ending Inventory = Material Used If there is no beginning inventory and no ending inventory, material used cannot be determined. If no inventory is taken, owners often leave the inventory figure (and therefore the calculation of material used) to the discretion of the CPA. Most CPAs are not door people and don't understand the nuances of the industry. For most door dealers, material is a biggest item on the income statement. Again, without an accurate material usage number, a correct yearend profit figure cannot be accurately determined. We have pointed out the costs associated with a messy, disorganized warehouse, but how can a warehouse disaster be turned into an organized fully functional warehouse? Several elements are key, with some more key than others depending on the sales volume and product orientation of the dealership. 1. Adequate Space: Clutter and messiness of a warehouse can often be traced to a simple lack of space. Owners might feel their location is more important than an efficient warehouse, but both are important. The correct amount of warehouse space varies significantly based on type of sales (mostly residential, mostly commercial, or mostly service) and product type and whether product can be stored outside or must be inside. 2. Designing Storages Areas of the Warehouse: Well managed warehouses have set locations for specific products, i.e., a set space for residential doors, another area for commercial doors and another for operators. Some dealerships separate material for sold jobs from material on hand as inventory (un-sold jobs). Track, springs and hardware boxes need their own home, but also need to be easily accessible to marrying up with the corresponding sections once the job is ready to install. Most door dealers have a designated secure area for openers and controls. 3. Share the System Parameters: Share the warehouse systems and rules with all that need to know. Smaller dealerships, without the benefit of a specific warehouse manager will typically allow all field personnel access to the warehouse. These field employees typically load their own trucks, using fellow employees and management personnel for assistance. In larger firms, warehouse employees gather material for specific installation crews, ! Northwest Door Warehouse Broten Door & Gate Warehouse In the garage door industry, the most successful garage door dealerships have worked for years to develop systems and work rules to keep a clean and well-organized warehouse. On the other hand, it is true that firms with dirty, cluttered and unorganized warehouses often are not financially successful firms.

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