What is a Receiving Department?

A receiving department should be differentiated from “accounts receivable” in organizational planning and management. Receiving is a department of a manufacturing, retail, or services business which is devoted to receiving physical goods, equipment, or raw materials that are critical to business operations. Hospitals, colleges, and universities also have large, busy departments that receive goods, furnishings and equipment.

Inventory and Enterprise Resource Planning

You may have heard the term ERP (Enterprise Resource Planning) and receiving departments are key players in the ERP process. Many management and planning concepts that are critical to ERP related to receiving equipment, supplies or parts on time. In a services organization like a large hospital, receiving departments will accept shipments of supplies, pharmaceuticals, or medical equipment. A streamlined system using ERP software technology to manage these important items is essential to connect the receiving warehouse or storage facility and departments that need the goods and supplies. TrekGlobal and other enterprise receiving management consultants advise that scanners, software, and electronic tags can strengthen the receiving pipeline.

Related: 5 Essential Elements of MRP Systems

Safety and Efficiency

Receiving departments in small and large organizations can accept goods that range from small envelopes to shipping containers full of merchandise or oversized equipment. Receiving managers need to plan their departments with safety and efficiency in mind. Area design should facilitate safe, rapid movement of goods. Aisles, walkways, and exits should be kept free of debris or stray boxes and items. Exits should be clearly labeled and safety equipment and clothing should be used at all times.

Good Receiving Procedures

Receiving departments are the first point of contact for equipment and supplies being delivered. Most deliveries will come via freight, including via truck or rail. The receiving clerk should first check that amounts received match the bill of freight and note any damage or potential damage. The bill of freight should be retained and the goods, supplies, or merchandise checked for a correct delivery. Finally, the bill of freight, packing list, and the receiving company’s purchase order should be compared to identify any discrepancies.

Sorting, Planning, and Storing

All goods or merchandise that are received may not be delivered or used immediately. Enterprise Resource Planning can help to identify the best storage procedures. When large shipments are received, the department can also improve efficiency by planning how the items will be unloaded and transferred to warehouse storage or distribution areas. Technology can assist by electronically tagging merchandise or supplies for storage and distribution. Movement throughout the company’s system may also be managed by electronic tags and ERP software.

The Role of the Receiving Manager

Receiving managers are responsible to administer their department from the supplies and merchandise that are received to the staff members who work in the department. They establish effective and efficient receiving procedures and manage goods storage and transport. They should also ensure that the team follows appropriate safety procedures and establish a safe, efficient physical environment. The receiving manager holds the team accountable for accurate, high-quality receipt of material items that the company has ordered and paid for.

The receiving department of a manufacturer, retail business, or not-for-profit hospital or university will often handle hundreds of deliveries a day. The first point of contact for equipment, merchandise, raw materials, and supplies, efficient receiving departments ensure that the rest of the company has the equipment and physical supplies necessary to fulfill its mission and operate with success.