Industry Insights, Productivity
10 Hidden Costs of Human Error in Inventory Management

10 Hidden Costs of Human Error in Inventory Management

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Effective inventory management is not only a fundamental cornerstone for businesses but also a critical factor in ensuring operational success. While its importance cannot be overstated, it is crucial to acknowledge that the intricacies involved in managing inventory can occasionally result in costly mistakes, particularly when human errors come into play. Therefore, it becomes increasingly vital for organisations to implement efficient systems and processes that mitigate these risks and streamline their inventory management practices. By doing so, businesses can proactively address potential challenges, optimise resource allocation, and ultimately enhance their overall operational efficiency and profitability.

Impacts of Human Error within the Business

Human errors in inventory management can potentially lead to immediate and substantial financial repercussions. The direct costs can be substantial, but the consequences extend far beyond these immediate expenses. One of the major sources of errors in inventory management lies in the reliance on archaic paper-based systems and outdated technology. These outdated systems not only hinder productivity and efficiency but also pose significant risks to a company’s financial health. Operational inefficiencies that arise from relying on paper-based systems can result in unnecessary delays, errors, and inaccuracies, all of which can have a detrimental impact on a company’s bottom line. Therefore, it is crucial for businesses to recognize the importance of adopting modern inventory management solutions and cutting-edge technologies to mitigate the risks associated with human errors and safeguard their financial well-being.

10 Hidden Costs of Human Error in Inventory Management

  1. Lost Sales: Resulting from mis-picked or mis-shipped items.
  2. Increased Labour Costs: Needed to amend these mistakes.
  3. Return & Re-shipping Expenses: Arising from incorrect shipments.
  4. Wasted Inventory: Due to damages or mismanagement.
  5. Reduced Morale: Persistent errors can demoralise teams, leading to further mistakes and decreased output.
  6. Brand Reputation: Consistent errors can tarnish a brand’s image, affecting customer trust.
  7. Opportunity Costs: Resources spent on rectifying errors could be allocated to more productive endeavours.
  8. Slower Processes: Manual systems lag behind the efficiency of digital counterparts.
  9. Inaccuracy: Manual data entries are error-prone, leading to inventory mismatches.
  10. Tracking Challenges: Without real-time insights, inventory management becomes cumbersome.
  11. Increased Labour Costs: Due to prolonged processes.
  12. Inventory Wastage: From inaccurate inventory oversight.

The Rise of 5-inch Android Barcode Scanners

Modern businesses are quickly embracing rugged 5-inch Android barcode scanners for enhanced inventory management. With benefits like instantaneous scanning, digital precision for accuracy, and real-time tracking of inventory levels, these scanners offer economic returns through increased revenue and reduced costs. Investments in barcode scanners typically yield returns in just a few months.

  • Operational Benefits:
    • Speed: Instantaneous scanning capabilities.
    • Accuracy: Digital precision minimises human error.
    • Real-time Tracking: Streamlined inventory level oversight.
  • Economic Returns:
    • Increased Revenue: Efficient processes allow for more daily orders.
    • Reduced Costs: Fewer returns and re-shipping instances.
    • ROI: Investments in barcode scanners typically yield returns in mere months.

Spotlight: Wearable Glove Scanner

Experience the Conker’s wearable glove barcode scanners – the next step in inventory management. Designed to be worn on an employee’s glove, it ensures uninterrupted work and scanning, further diminishing picking times and potential errors.

Hands-free scanning in warehouses offers significant operational advantages. It enhances efficiency, reduces strain on workers, and ultimately improves productivity. Immediate scanning boosts accuracy, resulting in decreased errors and costs. Moreover, this streamlined process enables higher order volumes and promotes employee satisfaction, which helps minimise turnover.


The hidden costs stemming from human errors in inventory management can have profoundly negative implications for a company’s financial performance whether they involve miscounts, inaccurate records, or misplaced items, can lead to stockouts, overstocks, and operational inefficiencies that directly impact the bottom line.

However, businesses have the opportunity to overcome these challenges by making strategic technological investments. Implementing advanced inventory management systems and automation tools can help mitigate potential errors, enhance accuracy and visibility, streamline processes, and optimise inventory levels. By doing so, businesses can elevate operational efficiency, reduce costs, and ultimately boost both profits and customer satisfaction.

In summary, by recognizing the hidden risks associated with human errors in inventory management and embracing innovative technology solutions, businesses can enhance their ability to meet customer needs, drive operational excellence, and maximise profitability. The key lies in leveraging technological advancements to empower efficient and error-free inventory management practices.


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James Summers

James Summers

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