Managing Delivery Variance

Deliveries can be incorrect. Orders and what is delivered can be at variance. All variances must be logged and reported as soon after delivery as possible. If variances are not reported or are delayed, the receiver (i.e. the warehouse) will be liable, not the carrier or supplier.

Recording variances requires manual or scanned entry into the database where inventory movement is logged. In primitive or very small systems, the log may be a physical paper-and-pen stock book; in sophisticated or large systems, it is likely to be a bespoke or industry standard computer system that is communicated with through screens on handheld or wrist-strapped scanning devices carried by operatives.

Variances can be reported to one or all of the following: supervisors, the supplier concerned, and the company’s accounts payable department (so payment is made only for goods received in perfect condition). Normally, operatives will only report variances to their immediate supervisor. However, in technologically sophisticated warehouse and distribution facilities, variance notifications – both to internal and external parties – will be sent digitally and instantaneously. As soon as goods are recognized as faulty, the operative can use his/her handheld device to flag the item and report the problem. The inventory count will be adjusted accordingly, the operative may receive a relocation order for the goods, the accounts department will be informed, and the supplier will also receive notification. Such automated processes ensure that the faulty product is not paid for, and the manufacturer has time to ship a replacement with the next order.