The inventory dilemma

With summer here I'm having a lot of the spring plants start to produce seed.

This is also the time the birds like to pick through and eat as much of the seed as they can.

This leaves me with a dilemma similar to how to handle inventory:

  1. Pick some seed now, process it for storage, and repeat in a week. Lots of time invested but lots of yield. A just-in-time (JIT) seed harvest process.
  2. Wait for 90% of the seed to mature, pick it once and process it for storage. Less time but a lot of seed losses to the birds and heat.

There's no right answer that can be constant from year-to-year. If I decide to wait (#2), in years where I have very few plants producing seed then I risk not getting any seed at all due to the birds. Or in a year where weather or natural issues happen (wildfires) I might miss the window to harvest the seed and lose it all.

Option #1 isn't any better. If I'm busy it can be difficult to find the time to harvest. Or if I harvest but it's too small of a batch to process for storage then the seeds could be wasted.

This inventory dilemma comes up a lot in manufacturing and retail. Should you produce just enough units to get by (#1) or should you stock up (#2)? How good are you at guessing "just enough"? Do you want to risk losing the sale due to stockouts?

In the business literature there are some answers that get proposed (I hate to call them solutions as they don't solve the underlying problem, just make it better).

Sometimes you can go massive in scale and store it. Huge warehouse, freezers, grow 100x the plants, etc. That way even with the actual losses in #2, you still have plenty of product. Problem is the inventory and carrying cost can get excessive.

Sometimes you can streamline your processes so the small batches are easier to work with (make #1 less risky of stockouts). But then shipping disruptions like in 2020 can cripple your sales.

Rarely innovation can remove a loss completely (e.g. seed catchers around plant to hold seed, white-label with dropshipping). That would require investment into new tech or fundamental changes to your processes or business. It could also come with vendor or process lock-in which makes change hard.

All answers come with costs or trade-offs. The difficultly comes from picking which one makes sense for your store.

For my seed saving, I've decided to go the more agile route. Harvest just enough seed as soon as it's ready and then do a final large batch at the end. It takes significant time but less than a JIT process and should easily give me a minimum amount of seeds.

For your product inventory that could look like a large manufacturing run or order to start, followed by JIT reorders.

Eric Davis

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Topics: Product inventory

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