In this blog, you’ll learn about inventory usage for reusables and how Topanga’s real-time asset tracking via our track-and-trace technology can improve the operational efficiency of your reusables program and your ROI.
Introduction
Proper inventory usage is one of the biggest challenges culinary programs face with reusable containers due to their reusable programs lacking 1) student accountability, 2) the ability to track inventory usage, and 3) the data to build a usage strategy around.
With Topanga’s ReusePass reusables program, our 1:1 track-and-trace technology, SMS return reminders, and optional late fees/single-use surcharges ensure that diners are held accountable––and that a 97%+ average return rate becomes your new norm. Without worrying about returns, you can focus on inventory management and usage via the Topanga Dashboard, the true unlock for running an operationally efficient and ROI-sound reusables program. You get a complete behind-the-scenes view of your reusables program, allowing you to leverage data-backed insights to improve your reusables program via key data visualizations and statistics. In this blog, we'll dive into what inventory usage means, why it’s important, and how Topanga's dashboard helps you manage it.
What is inventory usage?
Inventory usage, or asset usage, illustrates how much of your reusables inventory is circulating. Effective inventory circulation is essential to maximizing the reuse rate on your assets, understanding your inventory flow, and gauging operational optimizations. It reveals the overall success and impact of your reusables program and helps your organization drive a sound reusables strategy that can scale year over year.
How is inventory usage different from reuse rate?
Reuse rate is the number of times each asset in circulation is used and returned. Inventory usage is a top-down look at your total inventory, helping you answer questions like, ‘based on my starting inventory, how many containers are still in circulation vs. retired vs. yet to be used?’ When inventory usage is leveraged in combination with return rate, you can easily gauge the lifespan of your containers.
You can dive into more details of this in our blog post on recent Dashboard updates.
How do you measure inventory usage?
Inventory usage is measured by looking at the total assets that have entered circulation and analyzing their use through the return rate, cycle rate, and reuse rate in the Topanga Dashboard.
Inventory Return Rate + Cycle Rate
The return rate illustrates the likelihood that your containers will be returned after being checked out. High return and reuse rates are the keys to program success, but they are also indicators of successful inventory usage. Excess inventory in circulation will result in your containers being used fewer times (lower reuse rate) and at a slower pace (high cycle rate), negatively impacting your inventory usage. With a high return rate, cycling less inventory more frequently will result in a more sustainable program and help you get the most out of your inventory.
Return-rate module (left) and cycle-rate module (right) from the Topanga Dashboard.
Inventory Loss
It’s important to note that even with a high return rate and a high reuse rate, inventory loss is normal and expected. Topanga provides additional resources to help your program evaluate loss and determine whether any actions or adjustments to program operations need to be made. Understanding inventory loss is key to measuring your inventory usage.
Retired Containers
Evaluating how many reusable containers have been retired is another metric that’s critical to understanding inventory usage. If your average reuse rate is high, it’s likely that your containers are being reused several times before they are retired. However, if containers are not properly retired using the ScanApp device, it’s difficult to determine how many times these containers are reused before being retired. Retiring containers once they are broken or damaged also unlocks more accurate inventory counts, so you know whether to add more inventory into circulation and/or purchase more reusable containers.
The best practice is to have 5X as many containers available as your program’s average daily check-out volume. If you have an active ReusePass program, you can find your average daily check-out volume by going to the Topanga Dashboard and referencing the Check-Outs and Returns module on the Overview page.
Realistic inventory usage based on data
A lot of reusable programs out there will tell you that their containers are designed to survive over 1,000 uses. However, the statistical likelihood that they get used that often is incredibly low. Statistically speaking, even if you achieve Topanga's proven 99%+ return rates, only 37% of your containers will make it to their 100th reuse. Topanga’s data team has clarified this common misconception in our recent ROI blog post which you can read here.
It’s undeniable that reuse can generate a significant return on investment and that durable, reusable containers are important when it comes to inventory usage. But when thinking about implementing a new reusables program, focusing on the potential lifespan of the container fails to account for actual statistics, which creates big blindspots in your ROI.
Refer to the reuse rate module in the preceding section to see realistic reuse numbers.
How do you improve inventory usage?
Improving inventory usage is reliant on your ability to track, measure, and manage your reusables inventory. If you don’t have a data-driven reusables program, this will be exceedingly difficult if not impossible.
As you continue to adjust the following levers, it will directly impact your inventory usage over time:
Improve return rate by…
Implementing a late fee and/or single-use surcharge
Adding more return bins across campus to make returns more convenient
Improve cycle rate (how long a container remains checked out before being returned and how long it takes to be checked out again) and reuse rate by…
Installing RFID readers in dishrooms to automatically scan returned containers
Implementing “first-in-first-out” (FIFO) inventory cycling practices to reduce the amount of time returned assets are sitting on the shelf
Limiting the number of assets in circulation to what’s needed, considering check-out volume
We hope this blog was helpful! Are you interested in seeing what improved inventory usage with ReusePass could look like on your campus? Reach out to us at sales@topanga.io to learn more!
コメント