Kanban's place in Inventory Management tools

Kanban is often linked to inventory management - and while is can definitely play a big role in that, kanban itself will not provide the stock levels, order quanities or most of your inventory management rules.
It's a system to physically and visually manage the stock that you have in your warehouse and provide the signals needed in your stock management system.
This video goes into the role of kanban cards in a typical warehouse and specifically discusses the 2-bin kanban system that greatly simplifies your stock replenishment.

[@dheerajreddy4312]

As always, Tom, you are the best. Thank you very much for your time.

[@bhargavtalreja9867]

You have got a great RUclips channel Mr. Tom. Keep it up👌👌👏

[@TomMentink]

Thanks for your kind words. I love hearing from people who engage with my videos - that gives me the motivation to make more videos 😃

[@KhanTeam07]

Very good teaching skills ❤

[@TomMentink]

Thank you Yasser! Thank you for your kind words and taking the time to share them.

[@FernandaF13]

Hi, If I have my main inventory stock and then stock in a 3PL warehouse, how can trigger automatically using Kanban as a resource ? IFS Apps 10 system. Any idea please ?

[@TomMentink]

If they have different items in the 3PL than in your main warehouse, just treat them the same as any other product in your warehouses - determine the replenishment rates and stock levels and set up Kanban from there.
If they are a sort of middle warehouse between your suppliers and you, then they will have a much more specific role to play: they will be your buffer between 'shop floor replenishment' and actual ordering from your supplier. Things will depend on what flexibility that 3PL warehouse has; say for example you're having daily freights and have to provide a picking list 16:00 the day prior, any Kanban card or empty box seen during a check round that comes in before 16:00 will be delivered the next day, boxes that are emptied later will have to wait 2 days before they're replaced. So make sure the remaining number of boxes will last you at least 2 days. Also, make the boxes big enough that it's easy to handle for your 3PL (if they only want to send you full pallets, than your 'box size' becomes a fully pallet...).

[@dheerajreddy4312]

Here is the question Tom, how to decide if we should consider two bins or more ???? What if my cycle time is 100 parts per min and each box has 250 parts ?? How many kanban boxes should I keep at point of use ???

[@TomMentink]

There isn’t really a formula to decide how big to make your kanban-inventory. Well formally there is, it’s the Economic Order Quantity formula, but that usually doesn’t really fit with in-factory kanban, mostly because the order and transport costs are just assumptions, almost never real calculations.
That same idea is what you’re looking at though: you want to limit the costs/efforts to replenish the bins so that production never has to worry, but low enough that you’re not making loads of mini warehouses all over the shop floor.
In your example, where you go through a box every 2,5 minutes, it’s so fast that you’ll want to count in pallets, not boxes.
These local warehouse/inventory kanbans, and especially two-bin kanban, is often used for replenishment frequencies of a shift or longer. So in your example: if those parts are the main ‘ingredient’ or a high volume item, give it its own logistics. If it’s a small extra part, have a couple of hours of stock there: if there are 24 boxes on a pallet (about an hour’s production), then a pallet would make a perfect ‘box size’, still requiring frequent replenishment. Around 600 or more boxes per pallet: use a certain layer on the pallet to trigger the kanban requesting a new pallet.