Logistic audit. assessment of the efficiency of warehouse logistics at the enterprise. Audit check of the state of warehouse facilities and ensuring the safety of inventories on the example of JSC Trade and Service Center Internal audit warehouse

How to audit a warehouse
Dmitry Perov, Head of the Department of Implementation and Support of Logistics Systems at ANT Technologies, © LOGISTICS and Management www.logistpro.ru

The business has been successfully automated for a long time, ERP is installed in the company, and WMS is in the warehouse. A large amount of statistics has been accumulated in the databases of these systems. It takes a lot of work to understand where, when and who makes mistakes and whether these mistakes are caused by the wrong construction of the company's business processes.
A huge advantage of this project is the deep interest and support of the top management of the company. In fact, this is permission for a complete diagnosis and readiness for any procedures, not only therapeutic, but also surgical. You can change the physical and information processes, the scheme of personnel motivation, etc.

At the first meeting, the strategic goal was defined: “In November 2008, the balance of goods in the warehouse should be such that it would be possible to refuse to rent additional warehouse space from third parties and not resort to their help throughout 2009. At the same time, the turnover of the company should not decrease.” Funding for reengineering - from savings from not renting additional space, eliminating inventory, as well as by improving the operating performance of the warehouse.

Diagnostic algorithm

Step 1. We carry out the analysis

We started, as usual, with an ABC analysis. It was carried out in the simplest way: up to 80% of the goods - group A; 80-96% - group B, the rest - group C. In one report, indicators were summarized in three parameters: in pieces, in sales and profit. Most of the goods belong to the same category for all options: AAA, BBB, CCC. It turned out that the main turnover is provided by 24% of the goods.

The excess inventory was then assessed. Added inventory for each category C item if it exceeds the annual sale of this product. It turned out to be about 400 tons. At first glance, for a warehouse of 8,000 pallet places, there are not so many, but on the other hand, due to such a low turnover, the question arises - are these positions needed at all? Together with the management, we decided that we should get rid of such positions. Based on ABC analysis, it is difficult to judge exactly which positions should be disposed of, since there are goods that are sold in small quantities, but steadily. To refuse them means to lose even a small, but part of the income.

Step 2. Define the sales curve

XYZ analysis usually serves to identify stability and instability. In theory, everything is simple: stability is determined using the coefficient of variation, calculated by the formula (the higher the coefficient of variation, the more unstable the object):

Ni=1 (хi – х–)2
n = n ґ 100%,
X-

where xi is the value of the parameter for the assessed object for the i-th period;

x is the average value of the parameter for the evaluated object of analysis;

n is the number of periods.

After calculating the coefficient of variation, the goods are divided into groups, for example, as follows:

group X - objects, the coefficient of variation for which does not exceed 10% (stable group of goods);

group Y - objects, the coefficient of variation for which is 10–25% (a group of goods of medium stability);

group Z - objects, the coefficient of variation for which exceeds 25% (unstable group of goods).

We tried to make a head-on calculation - we got that all products belong to category Z, which was expected. This calculation option is only suitable for a business in which seasonality is either low or not all products show up. Then the calculation allows you to identify seasonal goods. In our case, the seasonality is such that some of the time the goods are not sold at all, and this applies to almost every position. As an example, the graph shows the sales of one of the products for the last 33 months. The cycles are visible to the naked eye. Every 12 months the picture is repeated, for example, from 5 to 8, from 17 to 20 and from 29 to 32 there are practically no sales. A linear trend line is built on the chart, showing that sales are growing from year to year.

Step 3. Determine the curve of a non-random process

Thus, it can be assumed that there are two processes. One is not random, it is determined by two factors: a trend that shows how the average value of sales of a given product is growing, and a seasonal factor by which the trend value must be multiplied. The second process is random (model), it causes real sales to deviate from the non-random process calculated by us. A non-random process superimposed on the fact of sales for the same product is shown in the orange curve graph. Failures are predicted quite well, but there is a problem with sales peaks, methods of dealing with which need to be thought out. For illustration, we did not specifically select a product for which the curves are close.

Step 4. Calculate the difference between the model and the fact

The random process is equal to the difference between the model and the fact. The graph shows the curve of a random process (the modulus of the difference between the model and the fact). It is this deviation that we will take into account in our coefficient of variation. In the above formula, the difference in the numerator is our modulus, and x in the denominator will be the average value not from the fact, but from the value of the model. Thus, we removed the non-random process from the coefficient of variation. For the example taken, the coefficient of variation will be 1.27 (127%).

Step 5. Determine the actual sales

It is possible that a more realistic model exists for this product, but we are interested in practical aspects, so for our purposes we consider this model adequate. For greater confidence, we made the following calculation for several dozen products: we took actual sales without the last three months, calculated the model and predicted three months in advance. It turned out quite similar to reality. In order not to make a mistake with the level of stocks at the peaks, we applied the following trick: we multiplied our model by 1 + the coefficient of variation. As you can see in the graph, the actual curve almost always lies between the two curves in our model.

Step 6. We analyze excess stocks

Let's see why excess stock is created. We already have an answer to this question - our model can give it. Let's imagine that we have no stock at point zero of the time axis, and we predict the sale in the first month on the orange dotted curve, taking into account the random component. To do this, we need to buy the quantity that should be sold in the first month. But in reality, we will not sell this amount, but what the actual sales curve shows. Next month, we will buy as much as necessary to replenish the stock of goods to our forecast. If the remaining stock is greater, we do not buy anything. On the graph, purchases are shown as an orange line, and balances at the end of the month are shown in blue. As you can see, in the months when there are no sales, there are leftovers in the warehouse. This is due to the fact that the decline in sales is sharp, and before it there is a peak. By stocking up to ensure the peak, we are creating those very excess stocks. The linear trend of balances in this model is decreasing, but it is different for different products. In addition, this is our ideal residual model. In fact, the orange dotted curve was predicted intuitively and real reserves are even larger than in the model.

Step 7. Measures to combat excess stock

To combat overstock, smaller batches of each item must be ordered. It's not so easy. Today, the purchasing department uses ERP sales history and intuition. The result of such work of buyers initiated our project. It is necessary to build a new procurement model and create a convenient software tool based on it. The sales model built in this article will be used by us in the future to calculate the coefficient of variation and take it into account in the XYZ analysis and draw up a sales plan. We have already made a TOR for ABC-XYZ analysis, and programmers are implementing it in ERP. Calculating 4000 products in Excel is not an easy task, so in a wonderful spreadsheet we only model approaches to our problems. We will calculate the data for real work in ERP. The difficult-to-sell part of the CZ category product will be identified, a moratorium will be announced on the purchase of this product and measures will be taken to get rid of it.

Purchasing goods in large quantities on a monthly basis creates excess stock during sales downturns

The logical scheme of software tools will be discussed by us in the next article. Then we will build a purchasing model. Next, we will design tools and activities for reengineering, regulations and motivation, and put it all into practice. We do not know what will happen in the end, but we are sure that we will lead the project to the goal we have formulated and in November the warehouse will be free from summer goods.

Warehouse audit will help you evaluate the efficiency of the warehouse system, its components and many logistics processes. Find possible ways to optimize work processes and reduce storage space.

The GICOM company will audit your warehouse and give a list of recommendations for improving the work.

Required data for audit:

Warehouse logistics questionnaire - as is and forecast for 3-5 years (or % growth)
Warehouse layout with dimensions
The list of restrictions - the maximum number of receipts to the warehouse, the maximum productivity of each line, the maximum and minimum volume and weight of one SKU, etc.
Photos of the current warehouse - along the outer perimeter and inside

Warehouse audit technology:

Analysis of current intra-warehouse logistics
Analysis of warehouse processes
Warehouse management system audit
Determination of the structure of cargo flows
Audit of storage efficiency of products on racks
Analysis of the topology of the location of equipment in the warehouse and production
Identification of "bottlenecks" - "points of growth", the optimization of which will increase the amount of goods received and shipped, storage capacity, depending on the tasks of your warehouse and production.

Logistic audit is considered as a mandatory stage preceding the implementation of the WMS - system. The results of surveys and recommendations of experts help to find the best solution for storing goods, optimize the performance of warehouse operations, loading and number of staff, etc. In other words, a logistics audit helps to understand what needs to be done in the warehouse to bring it in order before automation.

Auditing the state of warehouse facilities and ensuring the safety of inventories on the example of JSC Trade and Service Center

Checking the state of storage facilities and the safety of inventories is one of the most important audit procedures. For a comprehensive study of this area of the organization's activities, the auditor examines warehouses, pantries, workshops and other places of storage of industrial stocks, checking the conditions of their storage, the state of fire safety, the equipment of warehouses with the necessary equipment, machinery, instruments and the correctness of their operation, the state of protection of warehouses. The unsatisfactory organization of storage facilities indicates a low level of internal control over the safety of the inventory.

In the course of the survey, special attention is paid to checking the organization of the liability of employees associated with the acceptance, storage and release of material assets. One of the conditions for ensuring the safety of material assets is the development and delivery of financially responsible persons with standards or job descriptions that define the duties and rights of employees, their work schedule, the procedure for accepting and issuing valuables, their documentation, keeping records in warehouses in natural meters, terms providing reports to the accounting department, etc.

When inspecting the places of storage of MPZ, according to the documents available to financially responsible persons, they check whether they process the acceptance and release of valuables in a timely manner and make entries in books or warehouse accounting cards. Unrecorded surplus of materials and finished products can be created by:

Substitution of raw materials in the manufacture of finished products;

Calculation of deliverers of raw materials and materials in weight, humidity, lowering their grade;

Body kit, calculation, measurement of buyers when they release finished products;

Unreasonable registration of acts on the loss of materials during their transportation or storage in warehouses.

Unaccounted for surplus materials are usually stored separately. To identify them, you should use the warehouse accounting data. If there are unrecorded surpluses, then the consumption of certain types of values for certain periods, as a rule, exceeds their income. Such an overrun is covered by the subsequent receipt and posting of materials of similar names. Surpluses are withdrawn at the expense of subsequent receipts or are issued with non-commodity documents until their actual presence is checked during the inventory.

Inspection of the state of the warehouse and ensuring the safety of material assets, combined with subsequent documentary verification, make it possible to draw reasonable conclusions about the safety of the inventory and develop preventive measures.

Stocks can be stored in several warehouses, and in this case it is advisable to carry out their inventory at the same time in order to exclude the possibility of transferring valuables from one warehouse to another. If for some reason this is not possible, then the auditor needs to track the internal movement of stocks between departments (warehouses) from the moment the inventory starts at the first warehouse to its completion at the last warehouse.

When conducting an inventory, the auditor may have difficulty in obtaining evidence of reserves, caused by the peculiarities of the technological process. This may sometimes require expert advice.

It may also be difficult to obtain evidence related to the determination of the amount of reserves, which are due to:

a) using sampling. As a rule, within the framework of one check it is impossible to check all stocks by a continuous method, however, if there is a clear discrepancy between stock records and their actual presence, it is necessary to check all inventory items;

b) the specifics of control procedures - it is necessary to make sure that there were no repeated counts and accidentally or deliberately unaccounted for values. Control reconciliations provide an opportunity to make sure that the calculation of values was carried out correctly.

c) the nature of inventory values (for example, inventory of wood stocks at pulp and paper mills, rolled metal, etc.). In such cases, the auditor can use estimating methods when counting and measuring part of the reserves, and then extrapolate the results of the audit to their total amount. The representativeness of the extrapolation results can be controlled by comparing them with accounting and warehouse accounting data.

The presence of some types of stocks cannot be checked for availability by simple recalculation, for example, in continuous production - chemical or steel. In this case, the auditor will have to rely on internal control procedures, and, with the permission of the client, involve experts to inventory such material assets.

Sometimes, for a number of reasons, it is not possible to conduct an inventory. For example, when by the time the audit contract is concluded, the inventory at the end of the year has already been carried out by the client, and he refuses to carry it out again, or when the inventory is quite expensive. In this case, the auditor can apply mathematical methods that, with a certain probability, allow estimating the amount of reserves. It may happen that the client does not want to conduct a complete inventory, but at the request of the auditor, he will conduct an inventory of a part of inventory.

Ensuring the safety of material assets largely depends on the selection and placement of materially responsible persons. Persons who had a criminal record for embezzlement, embezzlement and who did not justify trust in previous jobs should not be accepted for such positions.

There are also such violations as: the export of material assets on one pass twice; export of material assets by passes signed by a person who does not have the right to do so; export of material values according to oral permissions and notes, etc.

In the process of auditing the state of warehouse accounting at JSC TSC, warehouses, pantries, workshops and other places of storage of industrial stocks at the enterprise were examined, the conditions for their storage, the state of fire safety of warehouses, the equipment of warehouses with equipment, machinery, devices and the correctness of their operation were checked , the state of protection of storage facilities. Also, for the audit, an audit test was compiled to check the state of the warehouse and the safety of the inventory (table 3.1.)

When inspecting the places of storage of inventories according to the documents available to financially responsible persons, it was revealed that the registration of acceptance and release of material assets, as well as entries in books and inventory cards are made in a timely manner.

Stocks at the enterprise are stored in several warehouses, and in this case their inventory is carried out simultaneously in order to exclude the possibility of transferring valuables from one warehouse to another.

Table 3.1 - Audit test for checking the state of storage facilities and the safety of the MPZ Khakhonova N.N. Fundamentals of accounting and auditing. Rostov n / a: PHOENIX, 2005. - 89 p.

		Note

1. Is the territory of the enterprise protected?
2. Are the premises equipped with fire alarms
3. Have any material liability agreements been concluded:
Correctness of registration
Applied liability system:
a) individual
b) collective
c) pledge system
4. Do the positions of the MOL correspond to the approved List of positions and works to be replaced and performed by employees with whom the enterprise can conclude written agreements on full liability
5. Have materially responsible persons created conditions to ensure the safety of the MPZ:
Availability of closed warehouses
Availability of wardrobes, safes
Availability of necessary containers for storing valuables
Possibility of access to MPZ only MOL
6. Equipping of MPZ storage sites with the necessary measuring instruments
7. Is there control over the procedure for the export of valuables from the enterprise and the issuance of powers of attorney to receive them

The Company ensures constant control over the safety of existing inventory items. An important method of such control is the inventory, which allows you to control both the safety of the Company's property and the correctness of accounting.

When inventorying material assets, they check the availability of inventories on a certain date by recalculating, weighing, determining their volume and comparing the received, actual data with accounting data.

The Company conducts both partial, when they check the availability of valuables in individual storage places, and complete, when all valuables in the enterprise as a whole are covered by the check. A mandatory full inventory is carried out annually before the preparation of the annual report within the time limits established by the inventory instructions. In addition to the annual inventory, the company checks for the presence of residues in kind throughout the year.

A special commission is being created at OAO TSC to conduct an inventory. The results of the check are documented by the inventory list and the corresponding act. The head of the enterprise personally reviews the inventory materials and makes appropriate decisions based on its results. The surplus identified during the inventory comes. This creates an accounting entry:

Debit 10 "Materials" Credit 91 "Other income and expenses"

Shortfalls in inventories, as well as losses from damage to valuables, are debited to account 94 “Shortages and losses from damage to valuables” from the credit of the corresponding material accounts. If the shortages were identified by audits in the current year, but they relate to previous years, then the corresponding amounts are charged to the debit of account 94 from the credit of account 98 “Deferred income”. The missing products of the current year are written off at the planned cost. In the future, after a decision is made to write off losses and shortages, they are written off from the credit of account 94 in the prescribed manner. In conclusion, we note that, as such, no shortcomings in the state of warehouse accounting were found. Warehouse accounting is carried out in accordance with established rules.

Already in Russia, the time has come when it is relatively inexpensive to hire a competent specialist from the consulting services market and get detailed advice from him regarding the “well-being” of your warehouse. Let's say you found the right “specialist” with all the necessary qualities (although this is not easy), and sent it to your warehouse. What will he be able to see in your warehouse with his scientific and “non-soapy” look? A lot of interesting things if you know when and where to look and with whom and how to talk ...

When a person comes to the doctor, the doctor first checks his pulse, pressure, temperature, and according to the state of these and some other easily measurable indicators, he judges how healthy the whole human body is, whether it is necessary to continue to investigate it further, or you can immediately make a final diagnosis and start treatment immediately.

So is the warehouse. If you want to know how efficient the whole business is, it is more logical to start with an audit in the warehouse, and then a lot will immediately become clear and understandable.

You may ask: why does the warehouse act as this indicator - why, for example, not purchase or delivery or sales with finance, because they are also important links in the supply chain?

I answer: in order to understand the complex, you must first turn it into a simple one. Put it on the shelves, as they say, "separate the flies from the cutlets", and so on ...

"Cutlets - separately ..."

You ask how to do it? How to simplify, for example, a complex and cumbersome system of accounting and control of commodity and financial flows, or how to evaluate the effectiveness of the IT system of a large holding company, or how to find out how efficiently the money you invested in the modernization of any systems and technologies is being used, and how, finally, to find out when the promised profit from this modernization will appear?

Answer: There are two ways. You can invent some even more complex system in order to use it to try to evaluate the above systems and, as a result, possibly complicate things even more, or you can simply look carefully at some indicators lying on the surface, for example, in a warehouse, and use them to make the necessary conclusions.

And what are the important indicators in stock?

Over the years of my practice, being engaged in the audit of supply chains at a wide variety of enterprises, with a wide variety of warehouse technologies and the degree of equipment with various, modern and not very, ways of analyzing inventory management systems, for a preliminary analysis of the state of stocks, I always went to the warehouse first of all and at about within one working day already knew almost unmistakably how effectively inventory is managed in this company.

By and large, after all, a warehouse is a kind of indicator by which one can judge the efficiency of a business without error, just like, for example, by a person’s pulse ...

In the process of further in-depth and comprehensive study of data from the EIS (corporate information system) and conversations with heads of departments and company management, I almost never found good reasons to change my opinion about the state of stocks that I had after visiting the warehouse.

What else, besides the state of stocks, can be learned from stock indicators?

As a result of a warehouse survey, you can find out how efficiently money is spent on its maintenance, reconstruction or construction.

You can also find out how efficiently warehouse space, racking and lifting equipment are used.

You can also find out how efficiently the wage fund is spent, how productive the staff is, how effective its motivation is, what is the production culture in the warehouse, how it affects the quality of operations performed. And a lot more interesting and useful things can be learned from a professionally conducted audit.

Another conversation is that not everyone and not always wants to know the truth about their warehouse, but this is another topic not related to warehouse technologies, although no less important in this context.

I'm not going to reveal all my secrets here, but I'll just give one example to illustrate how useful a simple visit to the warehouse by a logistics specialist and SCM can be.

Well structured chaos

Imagine a warehouse of a distribution company with an area of approximately 3000 m2, with a height to the bottom edge of the beam of 10 meters, with rack storage of 4 tiers, a floor at around +1.2000, loading, with docks, with shipping / receiving areas, a ready-orders area, a storage area and a marriage. Everything is as it should be, just a dream, not a warehouse!

Warehouse, by the way, real. The owner ordered its design and construction according to a template project taken from a beautiful picture on the Internet.

I did an audit of this warehouse in 2011.

Entering the territory of the warehouse, at 9:00 I saw on the site in front of the docks a cluster of cars for loading, with a carrying capacity of 1.5 to 10 tons, and on the territory - several heavy trucks (arrivals).

Cars for loading were filled with the help of a forklift, which removed pallets of goods from open docks, put them in front of the cars, and then loaders and storekeepers manually loaded and placed the goods in vans. Why a warehouse with docks for these operations is not clear.

Since the docks were thus occupied, the "wagons" that came to unload the receipts stood and waited for the end of the loading of the expense.

In a warehouse, for example, it is possible, for example, to evaluate the effectiveness of the use of warehouse stocks almost without error ...

When I entered the warehouse, I saw a shipping area occupied by pallets of goods destined for shipping, used as a ready-to-order area.

All other processes during the shipment of the expense were not performed due to the lack of personnel and space to perform operations.

Being in the storage area, I examined the base cells and saw that the goods in the base cells were not laid out so that it was convenient to pick them, but scattered (as if they had been picked for the last time).

In the picking area there was a product that had not been picked up for a long time (it was evident that it had been lying for a long time, on an even layer of dust on the boxes), and goods in randomly torn boxes (one-piece), including those scattered in the aisles between the racks.

The stacking of goods was carried out by a reach truck and an electric forklift, which could move the goods no higher than the third tier due to the fact that the aisles were cluttered, the equipment was idle (“they saved” at one time on the transport equipment).

The last tiers of shelving were 90% empty. The third tiers were filled by 50 percent, the second tiers were overcrowded - there was practically no stock of empty cells in them.

From communication with the stacker, after he removed several pallets for me, I came to the conclusion that the rotation of the goods is unsatisfactory.

Judging by the amount of dust on the pallets with goods from the fourth and third tiers, it was clear that this product had stood idle for more than a month, and some positions for much longer (it turned out that some positions had stood idle since the start of the warehouse). The product is either not labeled at all, or labeled incorrectly (delivery date, batch number, product code are not indicated).

After talking with the head of the warehouse, I found out that the warehouse is carried out without “blank graphs”, when recalculating the goods are not removed from the upper tiers (what is written in large marker on the boxes is written down).

After watching the operation of receiving receipts a little later, I saw what I expected to see: most of the goods that came to the receipt were not placed, as it should be according to the FIFO principle (or some other), it was simply set aside (into the aisles ), because there was a shortage for all the goods that arrived, and this product had to be shipped to the next shipment.

Thus, it could be seen with the naked eye that in this warehouse only about 1/3 of the total volume of goods is actually turned around, and the rest of the goods simply occupy the remaining space with little or no movement.

No ABC analysis of the warehouse could have shown the problem more clearly than was seen in the warehouse at this time.

It was located along with other things, it was collected and written off once a week.

The staff of the warehouse changed constantly, there was a “curve”, there was no team as such, people worked from inventory to inventory and changed every 3 months.

With all this, the business executive hired highly paid inventory managers who never went down to the warehouse at all, but at the same time provided him with a lot of different smart tables and calculations regarding the state of stocks in his warehouse ... and, oddly enough, he believed them.

Improve the efficiency of your business throughout the supply chain! And don't be afraid to take another look at the warehouse to see what's really going on there and to chat with the warehouse staff!...

In addition to this, the business manager had to make decisions within the framework of strict distribution agreements, where strict conditions were provided for sampling inflated volumes of goods at pleasant bonus percentages.

The condition for receiving these bonuses was that the supplier could at any time, without any approval, ship a consignment of goods that exceeded several times the usual receipts. As a result, goods were displayed in the aisles, and all warehouse processes slowed down significantly, or stopped altogether.

Ultimately, the company incurred some indirect costs that were harder and more unpleasant to calculate than the direct benefits from bonuses associated with an additional bonus to the head of the business and some of his subordinates, but in magnitude these losses, even on the surface, were significantly higher than the income from bonuses.

After auditing the warehouse, purchasing and delivery, the head of the business of this company received a full alignment of the existing problems by priority, and he gradually began to purposefully eliminate them.

Thus, an audit of the warehouse must be done. Do not bring to the point that, as in the example above, you have to freeze 2/3 of the inventory in non-liquid liquidity, following the lead of counterparties.

It is clear that there are fewer high-salary personnel in the warehouse who are able to lobby the interests of the warehouse in front of the company's management, but still it is not necessary to make a “garbage pit” out of the warehouse and take the “jambs” of all other departments there. This will only exacerbate the overall situation in the long run.

But even if everything in your warehouse is not as bad as in the example I described, you still don’t have to stop there.

Instead of an epilogue

Indeed, even the most modern and smart accounting and control planning systems will not be of any use if they analyze data that is not related to live and actually ongoing processes in the warehouse.

Yuri Kolmachikhin, logistics and SCM expert, for Consultant magazine

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The history of the development of such a category as audit is viewed differently by many authors. The corresponding definition in translation from Latin is interpreted as "hearing" and is used in practice to determine the verification. Thus, it is customary to understand an audit as a check carried out by an independent expert, aimed at a certain activity or phenomenon. That is why a distinction is made between technical, operational, environmental, and logistical audit, which is discussed in this article. What is meant by the presented category? How is she different from others? What are the types of logistics audit? These and other equally important questions can be answered in the process of reading our article.

The concept and organization of a logistics audit

Today, along with the concepts of financial, accounting, technical and other types of audit, an important position is occupied by a logistics audit. First of all, its action is aimed at reducing the costs of a logistical nature and increasing the efficiency of the economic activity of the enterprise as a whole.

A logistics audit should be understood as a comprehensive check of the efficiency of the logistics subsystems. The role of a logistics audit in choosing a logistics strategy is to identify "problem areas". So, in the course of the procedure, a tree of relationships between them is formed, which are of a cause-and-effect nature. In addition, a large-scale economic calculation is carried out in relation to sales, space utilization and inventory management. The organization of a logistics audit and the stages of conducting are directly related to the following types of audits:

Audit of purchases, that is, logistics.
Audit of planning according to the scheme "sales - production - purchases".
Audit of logistics costs for warehousing, packaging, storage and movement of marketable products.
Audit of the distribution of marketable products in accordance with the supply chain.

Logistic audit results

In addition to the organizational issue, the theoretical basis of the logistics audit system also includes the result of the procedure in the form of a report containing the following information:

Assessment of the actual state in relation to the logistics system of the enterprise.
A list of technical, informational, organizational and technological recommendations for improving all logistics subsystems.
Assessing the need for certain changes.
Preliminary (potential) return on investment.

The results that are announced after such a procedure as an audit of logistics systems usually speak of the relevance of certain projects related to the following points:

Development of a strategy in terms of the logistics component of the structure.
Reengineering (design) of a system or a logistics subsystem. A striking example of the latter is the design of a warehouse complex.
Formation of a system related to the regulation of logistics business processes.

Logistic audit and its main principle

The key principle of the logistics audit is the evolving movement from the general to the particular. In other words, the procedure begins with a review of the goals of the global focus structure and ends with the causes of missed opportunities, low productivity, and low efficiency. After working out general issues, the logistics audit of an enterprise involves a detailed study of the logistics functional areas in the company.

So, in accordance with the above principle, the current strategies of the enterprise are studied, which can fully influence the organization in terms of the movement of flows of material nature. In any case, this requires an analysis of the corporate mission, as well as the production, marketing and purchasing strategy of the company. The audit of logistics systems, as its final step, includes the formation of a database. So, it can be used to evaluate the performance of these systems in the enterprise.

To implement the procedure discussed in the article, a team is created, including representatives of the logistics service and other functional divisions of the company (accounting and finance, sales and marketing, procurement and production, information service, and so on). It is important to add that, for example, a logistics audit of an enterprise's transport system is carried out in the presence of external experts. In addition, students of specialized higher educational institutions are often involved in the implementation of the procedure. This move is undoubtedly expedient, because novice specialists, one way or another, need a practical basis to achieve their professional goals.

Stages of compiling branches of logistics audit

Modern scientists distinguish between several stages of a logistics audit, including preliminary, main and, accordingly, final. To begin with, it would be advisable to consider the preliminary stage of the logistics audit.

So, during the first two or three days, specialists study the functional areas of production, supply, sale and marketing of commercial products. Then, during the week, logistics experts process the results of the research, as well as prepare a list of logistics functions, which, one way or another, are subject to thorough verification. Logistic audit in its final line at this stage contains the formulation of questions for questionnaires and interviews, as well as the compilation of a list of indicators in accordance with which the logistics functions will be assessed.

The main stage of the logistics audit

To begin with, it should be noted that the main stage of such a large-scale procedure is classified into internal and external audit. This chapter discusses the audit of logistics costs on the example of an industrial enterprise and its main stage. The starting point of an internal audit is an interview with the head of the enterprise. After that, the logistics audit is carried out in accordance with the following areas:

The first direction involves a survey of employees of the functional divisions of the company on issues that, one way or another, are related to logistics (sales, warehouses, transport).
The second direction involves working with a sample of enterprise documentation.
The third direction speaks of the collection of information in accordance with supply contracts for the statistical analysis of sales and purchases of marketable products.

In the process of internal logistics audit, a system of indicators is used, which are classified into the following groups:

The first group contains indicators of servicing external and internal consumers, as well as an assessment of the quality characteristics of the service, which includes the ability to fundamentally change the features of orders in accordance with customer requests, the time of order execution, as well as stability in relation to this time.
The second group includes indicators that are directly related to the cost of funds for the implementation of logistics operations and procedures. In the process of cost analysis, an assessment of the cost-benefit ratio is made. This refers to the benefits that customers receive from the adoption and further implementation of certain decisions in the company.
The third group includes several indicators of the use of its own fleet of vehicles (rolling stock) or storage facilities, including the coefficient of application of the carrying capacity of the vehicle, the coefficient of application of the warehouse volume, and so on.

External audit

As it turned out, the main stage of the procedure considered in the article contains such types of logistical audit as internal and external. In this chapter, it will be useful to familiarize yourself with the latter. It is important to note that it makes sense to start an external audit only when the internal audit procedure is guaranteed to be passed. So, at this stage, the expectations and requirements of the clientele are studied in order to determine the optimal performance of the enterprise; consideration of the techniques used by competitors; assessment of the level of service to consumers of the material flow, and so on.

It should be noted that an external logistics audit is carried out in the form of mailing specially prepared questionnaires or selective interviews directly with representatives of the companies served, as well as buyers from different geographical locations or with different volumes of purchases. It is important to add that standard questionnaires are necessarily adapted to each structure being checked. In addition, as a rule, not only the heads of the company or its individual divisions are interviewed, but also specific employees in accordance with their field of activity.

Thus, based on the results of an external audit, it is possible to form specific recommendations for the structure and indicate the changes that need to be made in the current logistics system at the time of the audit.

The final stage

After the main stage of the logistics audit has been completed, it is necessary to prepare the following analytical reports:

The first report, developed in accordance with the analysis of the range of stocks, contains information about the range of raw materials and commercial products, stocks by groups, categories or positions, and estimates of the turnover of positions by stock.
The second report contains an analysis of the cash flow in the company, as well as outside it. For example, a detailed description of the movement of cash flow through the warehouse in general and the volume of cash flows in accordance with each logistics operation separately. It is important to note that on the segments of the line located between the storage areas, it is also important to indicate the amount of cash flow. The results obtained are used to determine the number of loaders and vehicles for intra-warehouse purposes.
The third report is devoted to equipping the enterprise with resources. Thus, the relevant information includes the classification and characteristics of loading and unloading equipment. The main purpose of the description is nothing more than an assessment of the material and technical base relevant to the enterprise.

Summarizing information

As it turned out, a logistics audit is carried out in order to identify shortcomings in the logistics system of the structure. After identifying “bottlenecks (areas with increased risk), one way or another, logistics experts develop recommendations to correct the identified problems. Of course, these recommendations are subsequently used to improve the level of service for existing customers, find new ones, as well as to improve cash flow management.

An example of a logistics audit

In this chapter, it would be advisable to consider the logistics audit procedure using a specific example. A warehouse audit is nothing more than a search for methods to improve warehouse performance within the scope of an express study of warehouse processes and resources. This event can be carried out both on a one-time basis and on an ongoing basis. As noted above, a logistics audit is mainly aimed at identifying shortcomings in the organization of the warehouse, as well as in its work. In addition, in this case, it is appropriate to create certain proposals to eliminate the deficiencies found. A particular task of the procedure considered in the article is often the justification that the warehouse needs to be automated.

Often, a logistics audit is considered a mandatory step preceding the implementation of a WMS system. Thus, the results of research and the relevant recommendations of logistics experts make it possible to find the most optimal options in terms of storing commercial products, as well as optimize the implementation of warehouse operations, the number of employees, loading, and so on. In other words, a logistics audit, one way or another, contributes to the realization of what needs to be done in the warehouse to bring it into absolute order before automation.

Logistic audit in practice

Warehouse logistics audit includes the following operations:

Infrastructure analysis.
Analysis of the technical process.
Analysis of relevant documents.
Analysis of computer and information systems.
Development of proposals and recommendations to improve the situation.
Calculation in terms of a feasibility study for the implementation of a WMS system.

In the process of performing a logistics audit of a warehouse, the following tools are used:

Interviewing company employees.
Supervision of the working process in the warehouse.
Analysis of current documentation, including work instructions, flow charts, layouts, and so on.

The results of the logistics audit in the warehouse are the following points:

List of current problems for the enterprise.
Recommendations for solving existing problems.
Rationale for the need to introduce an automated system.

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