Inventory Management: We Can Do Better

Supply Chain Shaman

Downsizing inventories over the past decade crippled the response.” In Table 1, I share research collected for the Supply Chains to Admire analysis on the average days of inventory by industry across the period of 2004 to 2019 by increments to match economic shifts. The source of this data is a syndicated data provider of public reporting termed “Y-Charts.”). Days of Inventory Peer Group Across Time Periods.

The Inventory Accuracy “Confidence Gap”

Talking Logistics

Note: The following is an excerpt from “ Omni-Channel Logistics Leaders: 5 Key Insights to Improve Inventory Performance for 2019 ,” based on research conducted by Adelante SCM and LEGACY Supply Chain Services with input from nearly 100 supply chain professionals from retail, manufacturing, and logistics service providers companies in the United States and Canada. And it begins with improving their inventory accuracy. The Inventory Accuracy “Confidence Gap”.

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Design, Operating and Situational Inventory Trade-Offs

ToolsGroup

Gartner analyst Paul Lord has developed a framework to better understand inventory trade-offs by categorizing those decisions according to the objectives they are meant to achieve: structural, operational and situational. Many companies struggle with decisions such as “How many days of sales or inventory turns per year should we target? or “How can we reduce inventory and improve our balance sheet?”. Structural inventory is a direct result of design choices.

Strategic sourcing enters a new age. Are you keeping up? (Part 2)

ivalua

In last week’s blog , I began discussing telltale signs that you have entered the new age of strategic sourcing. Leading manufacturers have proven that best-in-class strategic sourcing can create measurable and sustainable shareholder value by contributing to top line growth and bottom line profitability. Improving costs remains a core competency for any sourcing organization. Inventory. The post Strategic sourcing enters a new age.

SanDisk’s Story of Customer Segmentation Strategies Using Inventory Postponement

Supply Chain Shaman

Source: Dictionary.com. Spinnaker Management Group asked me to co-present on a demand-driven webinar with SanDisk. Instead, in the SanDisk journey , they adjusted the speed of response to their customer segments, and actively designing inventory postponement strategies. This included monthly reviews between business units and central operations teams and adaptive inventory segmentation policies.

What Does It Take To Make Sourcing Truly Strategic?

USC Consulting Group

Marketplace pressures have forced procurement professionals to abandon traditional sourcing practices and implement more responsive strategies designed to promote organizational efficiency, agility and flexibility for growth, not to mention cost reductions. For businesses on the outside looking in, it might be difficult to understand how strategic sourcing differs from other long-established procurement practices. The post What Does It Take To Make Sourcing Truly Strategic?

The Benefits of Evolved Vendor Managed Inventory Model Led by Web-Based VMI

Cerasis

So why do we feature content related to Vendor Managed Inventory? In a VMI model, part of the equation is the inbound & outbound flow of the inventory. Inventory is then put on pallets and shipped as freight. Distributors will inbound to a manufacturer the inventory needed and transportation management, especially inbound freight management, efficiency is paramount to an effective vendor managed inventory model. We never ran out of or had too much inventory.

Vendor Managed Inventory Model for Supply Chain Cost Reductions

Cerasis

Below I will outline how a vendor managed inventory model, in conjunction with reverse marketing, value analysis, and collaboration will achieve supply chain cost reductions. Vendor Managed Inventory Model for Supply Chain Cost Reductions. A means of optimizing Supply Chain performance in which the manufacturer is responsible for maintaining the distributor’s inventory levels. The distributor maintains the inventory plan. Now the group analyzes each idea.

Why Inventory Revaluation Is Your Next Important Task

Unleashed

All product-based businesses need to track the value of their inventory – and this goes double in a period of dramatic upheaval. The value of your inventory has likely changed thanks to the Covid-19 crisis, and you should consider revaluing it before you make any major business decisions. What is inventory revaluation? Inventory revaluation is the adjustment of the costs of inventory to reflect changes in the recorded cost. Your inventory becomes obsolete.

Winning the Inventory Battle in the Consumer Products Industry

Logility

Depending on the source, it is widely reported that anywhere from 50 to 85% of new products fail to achieve success. From a supply chain standpoint the battle for new product profitability relies largely on two key capabilities, developing accurate new product forecasts and optimizing new product inventory. reduction in finished goods inventory (days). reduction in inventory obsolescence (percent of inventory value). Capability 2: Optimize New Product Inventory.

Sales, Inventory & Operations Planning – What It Is and How to Operate

USC Consulting Group

Sales, Inventory & Operations Planning (SIOP) is a dynamic process in which the company’s operating plan is updated on a regular monthly or more frequent basis. Sales, Inventory & Operations Planning is done on an aggregate or family level, and covers a sufficient span of time to make sure that the necessary resources will be available. Objectives of Sales, Inventory & Operations Planning. Prerequisites for Performing Sales, Inventory & Operations Planning.

Why Inventory Revaluation Is Your Next Important Task

Unleashed

All product-based businesses need to track the value of their inventory – and this goes double in a period of dramatic upheaval. The value of your inventory has likely changed thanks to the Covid-19 crisis, and you should consider revaluing it before you make any major business decisions. What is inventory revaluation? Inventory revaluation is the adjustment of the costs of inventory to reflect changes in the recorded cost. Your inventory becomes obsolete.

Retail Inventory Shrinkage Remains a Problem

Enterra Insights

For the last few years, inventory shrinkage has annually cost U.S. ” Regardless of how inventory is lost, shrinkage costs retailers a lot of money. To reduce shrinkage, retailers need to have a strategy to address each of the ways inventory can be lost. Inventory shrinkage strategies. Addressing inventory shrinkage begins with inventory management. Trujillo explains, “Take the plunge and invest in an inventory management system.

Why Large Companies Increasingly Opt for 4PL Services

Logistics Bureau

Even slight delays or inventory shortages can have a severe impact on a company’s bottom line. At the height of the pandemic-linked supply chain disruptions, Amazon set the bar extremely high for other 4PL providers, despite initially experiencing inventory shortages.

7 Key Factors that Underpin the Success of your Inventory Optimization Initiative

Supply Chain Opz

From the most basic to the most advanced organization, Inventory Optimization is a critical goal and one which underpins the effectiveness of the supply chain operation. Inventory Optimization requires an organization to sustain and maintain the right mix of cost versus service. In this article we will examine inventory optimization processes as part of a structured sequential journey and examine seven of the key factors in delivering the optimal mix of stock.

4 Best Ways Manufacturers Can Perfect Their Supply Chain

USC Consulting Group

A strong Sales, Inventory, and Operations Planning (SIOP) process and culture will provide the information you will need to communicate quickly changing demand and depleting inventory levels to your supply base. Focus on strategic sourcing. Strategic sourcing focuses on the development of long-term supply relationships for operationally critical products and services. Increase your inventory.

Parts Are Not Parts

Supply Chain Shaman

A slight change within a function–in sourcing or manufacturing, or along the chain–can greatly impact the outcomes of cost, customer service, or working capital. Today, over 90% of companies have deployed ERP and APS, but as shown in Table 1, inventory levels have grown not decreased in over 80% of industries studied. Days of Inventory by Industry Across Years. Let’s take a closer look at sourcing. This includes: Prioritized Inventory Actions.

What Your Inventory Can Tell You About Your Promotional Strategies

Cognira

Below are some thoughts about promotions from the POV of an Inventory Manager. Inventory Managers can see that there is no turning back time on the discount clock. Why do Inventory Managers care? – It’s harder to move inventory through the supply chain quickly in response to sales. Sometimes, to chase demand, we have to use alternate sourcing, which increases costs and strains the supply chain. How does this impact Inventory Management?

Tips for Getting Executive Buy-in for Supply Chain Planning Software

ToolsGroup

During this stage project leaders should be communicating with leaders and other functional groups to help them understand how SCP will benefit their specific roles and goals. How will the company and different functional groups transition to life with the new SCP technology? For example, instead of simply stating forecast accuracy improvement as a benefit explain how this will ultimately reduce inventory and working capital and increase service levels.

What Your Inventory Can Tell You About Your Promotional Strategies

Cognira

Below are some thoughts about promotions from the POV of an Inventory Manager. Inventory Managers can see that there is no turning back time on the discount clock. Why do Inventory Managers care? It’s harder to move inventory through the supply chain quickly in response to sales. Sometimes, to chase demand, we have to use alternate sourcing, which increases costs and strains the supply chain. How does this impact Inventory Management?

Do You Have a Proactive Supply Chain Design or a Reactive One?

Talking Logistics

Thankfully, digitization of inventory and technology like real-time shipment tracking from 3PLs are taking the pinch out of switching for these companies. While the Greenfield optimization approach doesn’t consider aspects like building capacities, inbound costs, transportation, or sourcing policies, it does offer a smart recommendation for the optimal amount and placement of your distribution centers. Eric Robinson is a Senior Project Engineers at Kenco Group.

The Next Great Disruption Coming to Supply Chains

Kinaxis

I watched a TED Talk video by Philip Evans, from Boston Consulting Group and shuddered to think that all our traditional fulfillment and inventory models can be drastically transformed by the “consumer”. Sure, we’re concerned, and in some cases stocking more inventory at local distribution centers. Then, they go to the retail store, scan the barcode to check inventory, price, and promotions in their 10 mile radius.

What About Them Apples?

Supply Chain Shaman

If we look back at history, 70% of companies implemented Vendor Managed Inventory (VMI), however two-decades later only 1% of companies use VMI processes to drive a better demand signal. I have been an industry analyst covering the market– Gartner, AMR Research, Altimeter Group and my own company Supply Chain Insights– since 2001. Inventory strategies and processes to absorb the error. The group will be no more than 35 business and technology leaders. (I

History Repeats Itself Without Supply Chain Leadership

Supply Chain Shaman

Tom, the colorful warehouse manager, constantly heckled Frank for the increasing inventory levels while Ed, the quiet material/logistics manager, constantly questioned if there was a better way. He felt that inventory was no problem, he would just cut it at the end of each quarter to make the balance sheet goals. Inventory Management market-driven value chainsThis is a story for the Eds, Franks, and Toms working together in supply chains across the globe.

Inventory Reconciliation Helps Improve Inventory Control

Unleashed

For any retail or eCommerce business owner, inventory stock will fluctuate constantly and there is a very real chance that your latest inventory records don’t accurately match your physical inventory stock. It is important to keep track of all your inventory and it is necessary to undertake periodic inventory reconciliations to ensure that the numbers in the database match the on-hand inventory stock. Inventory reconciliation. Inventory control.

Do You Understand Your Chief MRO Inventory Challenges?

Logistics Bureau

If your company is in the business of maintenance, repair, and operations, you should already be aware of the strengthening trend in service as a source of value , both in business-to-business and business-to-consumer marketplaces. Given this knowledge then, does your organisation place enough importance on the management of MRO inventory? If yours is one of them, and you’re wondering where and how to start getting a grip on MRO inventory, this post might help.

Control Towers: If Only There Was A Clear Definition

Supply Chain Shaman

Groups throw-out concepts. While there are many types of visibility (see Figure 1), the most common use case is either sourcing or transportation visibility. For example, only 29% of manufacturing companies can access total cost data and 31% struggle to see the impact of business decisions on inventory. Groups rally around the concept of real-time. However, to use these data sources, we must break paradigms and focus on the use of non-relational techniques.

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Five Reflections From Supply Chain Planning Benchmarking

Supply Chain Shaman

In most ‘benchmarking activities’, self-reported data is the most common source. However, for elements like forecast error, customer service and slow-moving inventory self-reported data is not sufficient. We assumed that we did not know what the connection was between the views of supply chain planners, supply chain leaders, financial data, and planning system output (forecast error, bias, inventory targets, and slow-moving inventory).

What Is ABC Analysis In Inventory Management?

Abivin

ABC analysis of inventory is the classification of a group of items in decreasing order, based on their value to the business. The A group is the most important in terms of the value contributing to the company, whilst C items are the least valuable. With the help of ABC analysis, managers can focus their time on other valuable products and adapt their inventory control policies accordingly. Source) 1. Source) 2.

How to Make Supply Chain Complexity Work to Your Advantage

ToolsGroup

Too many companies get locked into traditional processes and a familiar vicious cycle: unable to reliably forecast an increasing number of SKU combinations, they load up on inventory to accommodate long-tail, erratic demand. This invariably leads to extra freight costs and excess and obsolete inventory that either needs to be written off or sold at a heavy discount. achieving the same overall customer service level objective with far less inventory expense.

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Food and Beverage Industry Reevaluating Strategies to Combat Coronavirus

USC Consulting Group

Inventory management more of a priority. For example, inventory management has always been something that consultants have promoted, but it appears that more organizations are taking this advice more seriously. Griffith Lynch, executive director for the Georgia Ports Authority, noted in a recent group discussion that he’s witnessed the degree to which organizations have inquired and focused on smart storage strategies.

Challenges of global fast fashion supply chains (Part III)

Supply Chain Movement

Sourcing and manufacturing lead times. We have already discussed in this global fashion retail series about network design and inventory location in Chapter 1 and stores replenishment in Chapter 2. In this chapter we want to take a more upstream view to discuss about sourcing and manufacturing lead times. The first is the question of sourcing location. Chapter 1 of this global fashion retail series was about network design and inventory location.

The Convergence of Logistics and Commerce (and Social Networking Too)

Talking Logistics

I haven’t been briefed yet by Symphony about its Fulfillment as a Service offering, but the graphic below from its website illustrates the main components: a network of warehouses coupled with inventory and order management tools and APIs. Source: Symphony Commerce website. 3PL Supply Chain & Logistics Trends Supply Chain Technology Trends Descartes Systems Group e-commerce JDA Software logistics Symphony Commerce

How to Overcome 5 Challenges of Restaurant Inventory Control

Unleashed

Controlling and monitoring inventory stock is an ongoing challenge for may restaurant owners. Properly managing your restaurant inventory is, however, crucial to the financial and operational functions of the restaurant from the perspective of waste reduction and controlling your food costs. May restauranteurs find inventory stocktaking to be a time-consuming and tedious task but getting it right is essential to addressing the following challenges: 1.Tracking restaurant inventory.

Supply Chain Management: How to Optimize the Process

USC Consulting Group

Start at the front end with planning and scheduling, inventory management, and strategic sourcing. Here at USC Consulting Group, we’ve been working with organizations across numerous industries for 50 years, helping them transform their operations and optimize their supply chain. To learn more about how USC Consulting Group can improve your supply chain operations, contact us today.