Managing Inventory Quality Control for Improved Profitability

From the essential need of knowing inventory grade factors to meet contract requirements to the more complex need to segregate grain for identity preservation, quality control remains top of mind for grain handlers and processors.

As grain is less thought of as homogeneous and end-users are requesting more specific characteristics, knowing quality attributes is a necessity, whether the grain is ultimately designated for food, feed, or fuel. Quality aspects have a direct effect on the bottom line; therefore, it has become more important to be less “hit or miss” with inventory management and more diligent in having a solid grasp on quality control.

In supplying grain to processors, grain handlers should not leave quality control to chance. Having consistent grain quality impacts a processor’s ability to provide consistency of their finished products to help improve customer satisfaction and protect brand identity. Reaching a high level of consistency is directly related to what happens with the binning, blending, and storing of the grain.

At grain handling facilities, unreliable and time-consuming manual methods such as entering attributes on bin boards or spreadsheets and calculating weighted averages are common. However, these manual methods are being replaced with more reliable and accurate electronic methods. Software tools are available that electronically present bin boards that automatically update and track quality based on averaged grade factors. Knowing what went in and how it will load out - down to the level of each bin including non-traditional storage such as bunkers or flat buildings - translates into better opportunities to achieve consistency and quality at the grain facility.

These new tools also enable grain handlers to more effectively select bins and their blend proportions to arrive at desired factors and traits. Being able to anticipate blend results including levels of protein, test weight, and other attributes not only contributes to better consistency of inventory delivery but also makes it easier to gauge the profitability of the blending process.

Another key benefit for grain handlers of monitoring and maintaining quality is being able to react quickly to take advantage of market conditions and recognize the best premiums. Knowing grades and other attributes of the inventory at any point in time, and having a constant average of the quality of the grain that is in the bins, provides a tremendous benefit for merchandisers to capitalize on market opportunities and make fully informed, quick decisions that can result in additional profit.

For suppliers offering identity-preserved grain to meet demand for certain characteristics desired by the end-user, focusing on consistency in quality and varieties is paramount. Managing identity-preserved grain adds complexity to operations, but it doesn’t have to be difficult. An aspect included in maintaining quality (purity) and consistency particularly with IP grain is bin cleaning. Electronic tools that provide a historical view of bin activities, including cleaning, make it easy to keep track of and document event-related information.

When it comes to IP, there is no question that stringent processes have to be in place in order to maintain consistent, traceable identity of premium value grains.

Grain handlers who accurately capture the attributes of each load and deliver consistent quality earn the reputation of reliability that helps ensure ongoing, “supplier of choice” business relationships with processors. As grain handlers reap the benefits from improving their inventory quality control and strengthening their customer service, it stems from easy access to critical data and automation so that inventory becomes easier to monitor and manage.

Gone are the days of handlers having to manage bin information on chalk boards or in their heads. Managers across the company, not just at a particular location, need to have up-to-the-minute information in front of them to stay in-the-know for more effective decision making. Timely, accurate information is power in the process of managing inventory quality control for improved profitability.