WAREHOUSING & INVENTORY MANAGEMENT FOR SUPPLY CHAIN

 

Workers label, inspect and conduct inventory of Family Health Day supplies at the UNICEF Warehouse located in Mbuya, Kampala. ©UNICEF

Workers label, inspect and conduct inventory of Family Health Day supplies at the UNICEF Warehouse located in Mbuya, Kampala. ©UNICEF

Definition: Pharmaceutical warehousing or warehouse management is the physical movement of stock into, through and out of a medical store warehouse.

Warehousing ensures the constant availability and flow of essential quality health commodities, in appropriate quantities, in a timely and cost-efficient manner, through the supply chain system. Key warehousing functions include receiving and storing stock, inventory management, and distribution management.

 

What is the problem?

In an ideal supply chain, large warehouses storing large volumes of products are unnecessary because products enter and exit the warehouse quickly and efficiently on their way to the service delivery point. The task before all supply chain practitioners is to determine how much storage space is truly necessary if operations are as efficient as possible.

The warehousing domain of the supply chain faces problems created higher up the chain, such as poor quantification leading to incorrect stock procured, mistakes in orders, and insufficient financing. In addition, warehouses are challenged by insufficient human resources, poor physical infrastructure, and a lack of good systems to effectively track products throughout the system. These barriers lead to stock-outs, overstocking, and wastage of health resources. These are major problems in low-income country settings where resources for health are already limited.

Promising Practices

To respond to these challenges, the Supply Chain Technical Resource Team (TRT) has compiled several promising practices that have been used successfully to address the common barriers mentioned above:

table warehousing

Read the full Warehousing & Inventory Management here.

Indicators to Measure Progress in Warehousing and Inventory Management

♦ The recommended performance indicator for warehousing and inventory management is the percentage of facilities stocked out of each life-saving commodity.

♦ Additional indicators are:

  • ♦ The percentage of life-saving commodities with accurate stock record balance
  • ♦ The unusable stock as a percentage of the quantity received
  • ♦ The unaccounted stock as a percentage of the quantity received
  • ♦ The existence of supply chain management protocols for disposal of medical waste and management of unusable products
  • ♦ The percentage of facilities that satisfy all of the listed storage conditions
  • ♦ The percentage of facilities where cold chain conditions were consistently maintained.

Read the full Supply Chain Performance Indicators Guidance here.

KEY ACTIVITIES

The Supply Chain Technical Resource Team (TRT) contributed to the development of several guidance documents to support warehousing and inventory management:

  • Promising Practices in Warehousing & Inventory Management
  • Private Sector Engagement: a Guidance Document for Supply Chains in the Modern Context
  • Integration: Guidance for the Reproductive, Maternal, and Child Health Context (Technical Report and Case Studies)