Sharing inventory information pays off for Bouwmaat

Jeroen de Haan, supply chain manager at Bouwmaat, explains how Slim4 offers a wealth of information that supply chain partners can also benefit from. He goes on to add how sharing inventory information has enabled the business to increase availability as well as reduce supply chain costs.

Jeroen de Haan is a huge advocate for sharing information with supply chain partners. “Collaborating in this way can bring so many benefits; I don’t understand why so many companies are reluctant to do this. We share a lot of information with our suppliers, right down to the checkout details of our branches! I’ve played Slimstock’s Supply Chain Game and it demonstrates once again how important this is. If the demand changes at the end of the chain and suppliers are not informed or are informed too late, this will immediately lead to shortages and unnecessary inventory build-ups upstream in the chain.”

Bouwmaat is a construction wholesaler with 47 branches throughout the Netherlands. “Stock availability is crucial in our market,” says De Haan.

“When construction professionals come to collect their supplies and materials, the right products simply have to be there. There can be no excuses. It is also important for availability that suppliers are informed in good time. By feeding them with our sales data and forecasts, and providing them with insight into our local stock levels, we not only prevent them from building up excess stock, but we also allow suppliers to better anticipate demand and therefore deliver better reliability. As a result, we are better positioned to fulfil customer orders.”

Identify inventory issues more proactively

But sharing supply chain data should not just be a one-way street at Bouwmaat. Conversely, suppliers are also asked to be transparent and proactively inform Bouwmaat about stock issues. “If a supplier already knows that it will temporarily not be able to supply a certain item in the future, we want to know that in advance. In this way, the available stock can be optimally distributed to ensure we disappoint as few customers as possible. Alternatively, we may try to obtain the item through another supplier. If you inform each other in good time, an issue can often be managed well before it leads to real problems.”

Reorganising the supply chain

Bouwmaat made a major change to its supply chain network in 2017 with the establishment of a central DC. Before that, the company was organised in a decentralized way and all branches were supplied directly by suppliers. “By centralizing we gained a much stronger purchasing position and we have made an enormous logistical efficiency improvement,” says De Haan.

“Just think: with just under 50 branches and 120 suppliers, there were as many as 6000 different flows of goods through our supply chain. We have already removed 120,000 of the 200,000 deliveries from the sites. It’s clear to see how much time and money that has already been saved.”

Sharing forecasts with logistics service providers

Bouwmaat has chosen to outsource the logistics operation to logistics service provider Ceva Logistics, one of the largest players in the global supply chain services industry. “It is also important to share supply chain information with them,” says De Haan.

“Based on the purchasing and sales forecasts from Slim4, they can see how busy they are going to get and how many staff they need to schedule. Employees no longer accept it if they only hear in the morning whether they have to work that day, or not. As a result, capacity planning is becoming increasingly important in this sector. This is particularly important for fully or semi-automated warehouses where the capacity is fixed. Therefore, varying levels of high and low demand must be managed carefully.”

In addition to forecasting, Slim4 contains even more functionality that benefits the collaboration with a logistics service provider. “By having Slim4 calculate the optimal order moments and order quantities, we can limit the inbound and outbound tasks at Ceva and save money immediately. Ceva charges us for all logistics activities, so we see the impact of this immediately on the invoice.”

Let the entire chain benefit from Slim4

Even after the supply chain reorganisation, Slim4 is Bouwmaat’s central tool, both for managing inventory centrally and replenishing the branches. And this works well: with the 40,000 order lines that are sent to the branches every week, the wholesaler achieves a service level of 99%. But the software also offers a good basis for informing the rest of the supply chain.

De Haan: “The entire chain can benefit from Slim4. I see that the delivery performance of our suppliers has also improved considerably. Sharing inventory information with partners always pays off.”

Top tip: Give customers real-time insight into stock availability

By providing supply chain partners with insight into your stock, you can work with the entire supply chain to offer a better service to the end customer. Jeroen de Haan explains: “If we know what is in stock at a supplier, we can better inform customers: can the item still be ordered? When can they expect it? But even if you know that an article is not available, you can help the customer by looking for alternatives together. Certainly, in e-commerce, it is becoming increasingly important to have insight into your suppliers stock availability as you can then increasingly sell items that you do not have in stock yourself.”