For The Mandemakers Group, inventory is a strategic weapon. The kitchen, bathroom and furniture specialist differentiates itself from its competitors with a wide product range, honest advice and reliable deliveries. However, as its ever-growing stocked assortment began to place increasing pressure on its existing supply chain processes, Mandemakers Group called in Slimstock to help.
The Mandemakers Group (DMG) is the company behind well-known brands Piet Klerkx, Brugman Keukens & Badkamers, and Saniweb. “Inventory management is a strategic tool for us,” explains Jan van der Maden, the Supply Chain Coordinator at De Badenman, DMG’s logistics division, responsible for ensuring the availability of sanitary ware.
“When customers order a bathroom from us, they assume we will deliver their order on time and in full. Customer service is a high priority for us, but this focus also helps us. Planning errors result in high costs, as an installer then has to go back to the customer at a later date to fit the missing parts.”
To maintain flawless service levels, Van der Maden faces what he calls ‘interesting challenges’: “From the plumbing DC in Waalwijk, we centrally manage inventory to support all our sales channels. Each of these has a different sales pattern. We supply our own fitters, who assemble bathrooms themselves, but we also work with sub-contractors, who carry out construction projects. Through our e-commerce channel, we deliver directly to consumers. The latter is particularly tricky as online sales are far more erratic. If you offer a lower price, demand skyrockets, but if your price is too high, demand drops quickly.”
Urgent Inventory management issues
An additional challenge was that the inventory managers relied on Excel to plan orders. This not only made the ordering process extremely labour-intensive, but also left them without a thorough understanding of potential risks.
“Just to avoid going out of stock, we had to hold extremely high levels of inventory,” adds van der Maden.
However, the need for an advanced inventory tool only really surfaced as the coronavirus broke out, the supply chain coordinator recalls: “We absolutely did not want to ‘pass’ the huge level of supply chain uncertainty on to our customers. Service levels had to be maintained. And so the strategic decision was taken to build up more inventory, even for SKUs that we were still purchasing on order before the pandemic.”
It was time to call on Slimstock’s expertise. Indeed, given the extra work the new approach would create for the inventory managers, the business case for investing in the Slim4 platform was clear.
“If we had continued to work with Excel, we would definitely have had to employ additional planners,” the Supply Chain Coordinator states.
Remarkably smooth implementation
The implementation of Slim4 went remarkably smoothly, explains Van der Maden.
“Adopting Slim4 is much less complicated than, say, a warehouse management system, where you have to make all kinds of real-time links. The scope of the project was also well defined. We started in January and by March, our stock planners could already take advantage of the tool. They started to use the platform as part of a pilot scheme, but when they saw that Slim4 provided robust ordering recommendations, they became more and more enthusiastic. It made their work much easier. When issues arose, they could also quickly analyse the underlying causes. Previously, they had to consult many different systems. But with Slim4, they have all the relevant data in one place.”
Efficient ordering process
The new software has made the ordering process many times more efficient. The time that inventory managers used to spend on placing orders, they now spend on things that add real value. Their specific knowledge is secured in the system.
“Slim4 works on the basis of management by exception,” explains Van der Maden. “If the online demand for a product suddenly rises sharply, this immediately appears in Slim4 as an alert. Our planning team can then act on that. They now also have more time to consult with other departments and avoid misunderstandings. For example, if the sales team decides to phase out a product, it is not useful for us to repurchase it. Things like that are now well coordinated.”
20% Inventory reduction
In addition to a supply chain planning process, Slim4 has also led to improved inventory quality, he notes with satisfaction.
“We reduced the inventory by 20%, while we continued to offer the same high level of service. Indeed, our service level actually went up. In June this year, we achieved a week of 100% fulfilment rate for the first time in our history. That was above our expectations.”
After the initial drop in stock, it did then go up again – after all, the range of stocked items did increase – but he says the increase would have been much higher if his stock managers had still been working with Excel. So, thanks to Slim4, the stock increase was well managed.
In short, Van der Maden looks back on a very successful project and a positive collaboration with the supply chain experts at Slimstock.
“We were able to do most of the work ourselves, and where necessary, the consultants supported us perfectly. Among other things, their knowledge was very valuable when setting the strategic stock parameters.”
He says other companies struggling with their inventory management should certainly consider implementing Slim4.
“The implementation is not at all as difficult as people may think, and the investment is quickly recouped,” he concludes.