Supply chain teams are under constant pressure to achieve ever-more ambitious inventory reduction goals. However, given that high inventory levels are caused by a broad range of factors, identifying the best strategy to reduce the inventory can be a real challenge. The question for supply chain leaders is: how can you determine which inventory reduction opportunity will deliver the greatest return?
Most supply chain managers know that excess stock exists within their business. Yet in order to identify what caused the problem in the first place and, more importantly, determine how best to fix it, this requires time, effort and resource. Consequently, all inventory reduction opportunities should be analysed and prioritised accordingly. To help you assess where you should focus your inventory reduction efforts, we have put together 5 simple analysis techniques. Over the next few weeks, we will be releasing these top tips to help you make more objective decisions as you pursue your inventory reduction goals.
Ultimately, by adopting these 5 analysis methods, you will be better positioned to determine the following:
- Which issues require immediate attention
- Which products you should focus on first
- What actions you should take to deliver the greatest return