You have too much inaccurate inventory and do not do physical cycle counts often enough. You have to shut down the warehouse and this costs too much. The delta between actual inventory is too high of a percentage, and the system says you have something that you don’t too often. This may be because of damaged items, theft, and/or internal usage.
It is difficult to track items. You need to identify specific inventory by lot or serial numbers but you do not assign your own serial numbers. If you do, it is a manual process that takes too much time and is costly and error prone. You carry too much inventory past its life cycle/expiration date and your write-offs are costly.
The order desk takes orders for items that are out of stock too often. They cannot check across multiple warehouses and you cannot ship from alternate locations. They do not know what is in the warehouse, but already committed, or what is in transit. Partial orders cannot be filled or put on back-order. Orders are canceled often, and this is costly. This causes inventory to remain in stock.