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      • Multi-echelon forecasting
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      • Orderbook management
      • Management by exception
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      • Selling quantity / job lots
      • Supplier closure management
      • Price break optimisation
    • Supply Chain Strategy
      • Portfolio & range management
      • ABC / XYZ analysis
      • Product Life Cycle Management (PLC)
      • Service level differentiation
      • Waste / obsolescence management
      • Multi echelon inventory optimization (MEIO)
      • Supply chain collaboration (SCC)
      • Sales and operational planning (S&OP)
      • Business rules
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      • Stena Line chooses Slim4
    • Blog
      • INFOGRAPHIC – What is Inventory Optimization?
      • Inventory Allocation: How Retailers Can Find the Perfect Balance
      • Monthly vs Weekly Forecasting
      • 5 Ways to Tell You’ve Outgrown Excel
      • 3 Ways Excess Stock Can Put The Brakes On Your Profits
      • How To Trim Your Excess Inventory in 4 Simple Steps
    • Events
      • Connect with Slimstock at User Group Summit North America 2019 for the Chance to Win a Free Slim4 Inventory Analysis
      • Business Software Event
      • E-fulfilment Innovations Event
      • Retail event IT’s in the mix
    • Downloads
      • Slimstock’s Guide to ABC/XYZ Analysis
      • The EOQ Formula: From Theory to Practice in 7 Easy Steps
      • Fully Optimize Your Working Capital Management
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      • New product introduction & supersession
      • Management by exception
      • Multi-echelon forecasting
      • Production planning / Bill of Material (BOM)
      • Aggregation / dis-aggregation
      • Size curve planning
    • Inventory & Supply Chain Optimization
      • S&OP with Slimstock
      • Dynamic calculated safety stock
      • Omni-cannel inventory planning
      • Vendor Managed Inventory
      • EOQ
      • Orderbook management
      • Management by exception
      • Secondary sourcing
      • Selling quantity / job lots
      • Supplier closure management
      • Price break optimisation
    • Supply Chain Strategy
      • Portfolio & range management
      • ABC / XYZ analysis
      • Product Life Cycle Management (PLC)
      • Service level differentiation
      • Waste / obsolescence management
      • Multi echelon inventory optimization (MEIO)
      • Supply chain collaboration (SCC)
      • Sales and operational planning (S&OP)
      • Business rules
      • Customer segmentation
    • Reporting & simulation
      • Interactive dashboard
      • Key performance indicators (KPI)
      • Performance monitoring
      • What-if simulations & scenario planning
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      • Safety Stock
      • Economic Order Quantity
      • Promotions Management
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      • Stena Line chooses Slim4
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      • INFOGRAPHIC – What is Inventory Optimization?
      • Inventory Allocation: How Retailers Can Find the Perfect Balance
      • Monthly vs Weekly Forecasting
      • 5 Ways to Tell You’ve Outgrown Excel
      • 3 Ways Excess Stock Can Put The Brakes On Your Profits
      • How To Trim Your Excess Inventory in 4 Simple Steps
    • Events
      • Connect with Slimstock at User Group Summit North America 2019 for the Chance to Win a Free Slim4 Inventory Analysis
      • Business Software Event
      • E-fulfilment Innovations Event
      • Retail event IT’s in the mix
    • Downloads
      • Slimstock’s Guide to ABC/XYZ Analysis
      • The EOQ Formula: From Theory to Practice in 7 Easy Steps
      • Fully Optimize Your Working Capital Management
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      • Free up working capital
      • Improve Customer Service
      • Work More Efficiently
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Slimstock US

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      • New product introduction & supersession
      • Management by exception
      • Multi-echelon forecasting
      • Production planning / Bill of Material (BOM)
      • Aggregation / dis-aggregation
      • Size curve planning
    • Inventory & Supply Chain Optimization
      • S&OP with Slimstock
      • Dynamic calculated safety stock
      • Omni-cannel inventory planning
      • Vendor Managed Inventory
      • EOQ
      • Orderbook management
      • Management by exception
      • Secondary sourcing
      • Selling quantity / job lots
      • Supplier closure management
      • Price break optimisation
    • Supply Chain Strategy
      • Portfolio & range management
      • ABC / XYZ analysis
      • Product Life Cycle Management (PLC)
      • Service level differentiation
      • Waste / obsolescence management
      • Multi echelon inventory optimization (MEIO)
      • Supply chain collaboration (SCC)
      • Sales and operational planning (S&OP)
      • Business rules
      • Customer segmentation
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      • Economic Order Quantity
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      • Stena Line chooses Slim4
    • Blog
      • INFOGRAPHIC – What is Inventory Optimization?
      • Inventory Allocation: How Retailers Can Find the Perfect Balance
      • Monthly vs Weekly Forecasting
      • 5 Ways to Tell You’ve Outgrown Excel
      • 3 Ways Excess Stock Can Put The Brakes On Your Profits
      • How To Trim Your Excess Inventory in 4 Simple Steps
    • Events
      • Connect with Slimstock at User Group Summit North America 2019 for the Chance to Win a Free Slim4 Inventory Analysis
      • Business Software Event
      • E-fulfilment Innovations Event
      • Retail event IT’s in the mix
    • Downloads
      • Slimstock’s Guide to ABC/XYZ Analysis
      • The EOQ Formula: From Theory to Practice in 7 Easy Steps
      • Fully Optimize Your Working Capital Management
    • Benefits
      • Free up working capital
      • Improve Customer Service
      • Work More Efficiently

Slimstock US

  • Slim4

    Learn about your solution of interest in our academy here

    Learn about our customised services and programs here

    • Forecasting & demand planning
      • Demand profiling
      • Statistical forecasting
      • Seasonality & Trends
      • Promotion & event management
      • New product introduction & supersession
      • Management by exception
      • Multi-echelon forecasting
      • Production planning / Bill of Material (BOM)
      • Aggregation / dis-aggregation
      • Size curve planning
    • Inventory & Supply Chain Optimization
      • S&OP with Slimstock
      • Dynamic calculated safety stock
      • Omni-cannel inventory planning
      • Vendor Managed Inventory
      • EOQ
      • Orderbook management
      • Management by exception
      • Secondary sourcing
      • Selling quantity / job lots
      • Supplier closure management
      • Price break optimisation
    • Supply Chain Strategy
      • Portfolio & range management
      • ABC / XYZ analysis
      • Product Life Cycle Management (PLC)
      • Service level differentiation
      • Waste / obsolescence management
      • Multi echelon inventory optimization (MEIO)
      • Supply chain collaboration (SCC)
      • Sales and operational planning (S&OP)
      • Business rules
      • Customer segmentation
    • Reporting & simulation
      • Interactive dashboard
      • Key performance indicators (KPI)
      • Performance monitoring
      • What-if simulations & scenario planning
      • Inventory insights & analytics
      • Customer analytics
    • Supply Chain Tools
    • Benefits
      • Free up working capital
      • Improve Customer Service
      • Work More Efficiently
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      • Drive Products replaced popular software with Slim4 for better results
      • Roper Rhodes set to bathe in supply chain success with Slimstock
  • Our Story

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    • Benefits
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      • Work More Efficiently
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      • Meet Our Partners
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  • Academy

    Learn about your solution of interest in our academy here

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    • Slim 4 Training
      • Functional User Training
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      • Advanced User Training
      • Program Manager
    • Inventory Management Training
      • Inventory Optimization Minor
      • Inventory Management
    • Masterclasses
      • Category Management
      • Assortment Management
      • Forecasting
      • Safety Stock
      • Economic Order Quantity
      • Promotions Management
      • Sales & Operations Planning
      • Processes KPI’s & Reporting
      • Vendor Management
    • Additional Offering
      • Bespoke Inventory Optimisation Minor
      • Supply Chain Game
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      • Free up working capital
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      • Work More Efficiently
  • Blog & News

    Learn about your solution of interest in our academy here

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    • News
      • Stena Line chooses Slim4
    • Blog
      • INFOGRAPHIC – What is Inventory Optimization?
      • Inventory Allocation: How Retailers Can Find the Perfect Balance
      • Monthly vs Weekly Forecasting
      • 5 Ways to Tell You’ve Outgrown Excel
      • 3 Ways Excess Stock Can Put The Brakes On Your Profits
      • How To Trim Your Excess Inventory in 4 Simple Steps
    • Events
      • Connect with Slimstock at User Group Summit North America 2019 for the Chance to Win a Free Slim4 Inventory Analysis
      • Business Software Event
      • E-fulfilment Innovations Event
      • Retail event IT’s in the mix
    • Downloads
      • Slimstock’s Guide to ABC/XYZ Analysis
      • The EOQ Formula: From Theory to Practice in 7 Easy Steps
      • Fully Optimize Your Working Capital Management
    • Benefits
      • Free up working capital
      • Improve Customer Service
      • Work More Efficiently
 

Category: News

Connect with Slimstock at User Group Summit 2019

Connect with Slimstock at User Group Summit North America 2019 for the Chance to Win a Free Slim4 Inventory Analysis

Friday, 28 June 2019 by nharper

Slimstock will be in booth #1431 at User Group Summit North America 2019 in Kissimmee, FL, October 15-18. Summit attendees who visit Slimstock will have a chance to win a Slim4 Inventory Analysis, valued at $5,000. The insights provided through these analyses give companies an accurate picture of their total inventory ordering process, and identify opportunities to lower excess stock and control for seasonality.

As a leading inventory optimization company with 925+ customers in over 40 countries, Slimstock’s Slim4 software works with a wide array of CRMs, including Microsoft Dynamics. Being CRM-agnostic allows each implementation of Slim4 to be fully customized to our customers’ needs.

Slim4 works with your ERP to optimize your ordering process

User Group Summit is an annual conference for users of the Microsoft Business Applications platform. With 25 years of inventory optimization experience, Slimstock has partnered with 150+ MS Dynamics users to realize impressive savings and process improvements. By guaranteeing these results, Slimstock has achieved 96% customer retention and is continuously improving our software suite to grow with and anticipate the needs of our global customer base.

Learn more about how Slim4 works here, and we look forward to seeing you this October in Florida.

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  • Published in News

Why do service levels have a powerful impact on profitability?

Tuesday, 07 August 2018 by dweir

“I need a 100% service level” – a typical expectation of both management and commercial departments. Purchasing & operational divisions however, have a much better understanding of service levels and appreciate that attaining 100% is a utopia. In practice, determining an appropriate service level is an extremely complicated undertaking.

Optimize your Service levels

For many businesses, the criteria for setting service levels is unclear and as a consequence, service level targets are set as a given figure (based on a quick and vague analysis). Furthermore, the quality of the service level is difficult to measure as the effects only emerge after a certain period of time. It is only when an inappropriate service level has a negative impact on safety stock inventory for example, that the service levels are reviewed and quickly adjusted (without any real analysis). Thus, service levels are not reviewed regularly. Should this worry you? Only if you think that service levels are a powerful instrument that have the potential to impact both your profit margins and overall business performance.

Do service levels really have such a powerful influence on your margin? And can a well-thought out service level provide your organization with a valuable asset?

Margin-boost

When describing a service level in its purest form, you are describing your company’s goal. It is a translation of your business strategy to your inventory strategy: you are deciding to what extent you want to satisfy your customer’s needs based on your stock capacity.

The service level is an operational translation of the maximum profit you want to generate.

When defining a service level, a number of components have to be taken into consideration including turnover, capacity, customer demand and cost. These components and their relations can be defined on an article level. For example, knowing that the cost component has an exponential character, an appropriate service level on an article level can result in a large margin boost at an assortment level.

Finding an optimal service level thus results into a margin boost on an article level, which in turn leads to a large margin increase at an assortment level. In addition to this, the insight into your assortment’s margin performance can also lead to further opportunities to increase margins over time.

Insight into internal processes

The advantage of a well-adjusted service level goes beyond margin increases as a thorough analysis also provides greater insight into your internal processes. By internal processes, we mean the processes that should mitigate both the supply chain factors and the demand chain factors.

A service level reflects your ability to meet demand and the capacity you are willing to use to satisfy this demand. If it is based on the right criteria, it should fit with your company’s strategy and the capacity of its processes. If your capacity is not based on the right criteria, it may not have the desired effects. This occurs because certain supply and demand influences are not taken into account and as a consequence, this can cause a margin decrease. In that case, simply increasing or decreasing your service level can make the issue even worse.

Your service level should be a reflection of your internal processes and the maximum profit they could possibly generate. From the service level and its effects, we can derive:

  • To what extent the internal processes can handle the service level
  • What this process input means for every individual article

You should ask yourself which element you want to change; the inventory process or the service level. Either way, one should be adapted around the other. However, there is a risk that you adapt the wrong one, which can lead to a decrease in quality of both elements. This in turn can have severe consequences!

In conclusion, the right determination of your service level can have a considerable effect on your margin, but it can also give your insight into the extent to which your internal processes and their capacity can be improved and aligned to your organizational goals.

How to get started?

The determination of a quantitative fact, based on quantitative data only, requires a formula. The correct determination of a quantitative fact, based on more than quantitative data alone, requires a perspective. The correct perspective.

With regards to the perspective of a service level, we mainly mean the way the cost and turnover components are approached. We should look at the relevant process input for each article. Superficial quantitative criteria like turnover (ABC analysis) and the cost of safety stock inventory should also be taken into consideration. However, we have to accept that there are also other, less quantifiable criteria in play. For instance; think of the actions your customers will take in the event of stock outs, is the expected turnover guaranteed?

The quantification of the appropriate service level is a company-dependent exercise, in which we should be able to determine the process input per article. Quantifying these criteria is not an easy thing to do. However, it is possible!

Would you like to have a more elaborate guide about how to determine the right service level for your organization? Click here to find out how you can maximize your availability through establishing more effective service levels!

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  • Published in News

Slimstock recognized by Gartner for their supply chain planning expertise

Monday, 16 April 2018 by sphipps

Following a hugely successful period of growth, Europe's leading inventory optimization specialist, Slimstock, has debuted on Gartner’s Magic Quadrant for Supply Chain Planning System of Record. As part of this research, Gartner identified that Slimstock achieved above average on overall customer satisfaction. The research also noted that customers have above average satisfaction with the business benefits delivered by Slimstock's inventory management solution, Slim4.

Gartner identified Slimstock for not only its significant presence in Europe but also its expanding international reach including the United States, Canada, and Mexico. Furthermore, according to Gartner, "references are particularly satisfied in areas such as its roadmap, domain expertise, in-house implementation services, total cost of ownership, as well as the frequency and ease of upgrades." Slimstock CEO, Eric van Dijk notes, “It's good to see that our focus on delivering tangible operational improvements is recognized by both our customers and the analysts at Gartner.”

The Magic Quadrant examines vendors that provide supply chain planning system-of-record solutions. Using multiple data sources to analyze and assess each vendor, the research from Gartner provides supply chain and IT leaders another point of reference while evaluating and selecting a supply chain planning system.

“We believe that our position in the quadrant reflects Slimstock’s ability to execute as promised, where others may fall short” says Jeff Woodmansee, VP Sales USA. “Particularly after a year with more than 100 new customers around the globe, we are proud of the recognition and look forward to more great things to come.”

Gartner

This graphic was published by Gartner, Inc. as part of a larger research document and should be evaluated in the context of the entire document. The Gartner document is available upon request from Slimstock.

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  • Published in News
Future Demand

Have you been bitten by the Chinese dragon?

Monday, 09 April 2018 by dweir

A lesson in managing supplier closures

Every year, China witnesses one of the largest human migrations in the world, as the nation’s workforce put-down tools and return to their home town’s to enjoy the Chinese New Year celebrations. Factories across the country close shop for up to 40 days while businesses across the rest of the world face a huge amount of supply chain disruption. Given the level of volatility during this time, what can you do to safeguard your operations before, during and after the factory closures?

With extensive lead times of up to several months, importing goods from China can be challenging at the best of times. However, when you consider that you may be left in the dark for over a month during the holiday period and even then, production may still be constrained for a few more weeks until suppliers catch up with back orders, it is vital that steps are taken to minimize the disruption during this time. Failure to do so could result in costly stock outs, missed opportunities and disappointed customers.

Inventory Planning: Understanding your requirements

In the face of supplier closures, it is important that you plan well in advance. Failure to do so may mean that you are left with an insufficient level of stock to meet demand. The obvious solution would be to buy extra stock to cover you while your suppliers are out of action. However, is this really the best approach?

For instance, if a large proportion of your inventory is sourced from China, this could mean you have to make a huge investment in order to hold several extra months’ worth of inventory to cover demand during this period. This would tie up working capital, thus having a catastrophic impact on cash flow. Equally, can you be sure that the product will sell through at all? If a product is coming to the end of the product life-cycle or is replaced by a newer, better item, over ordering in this way could potentially leave your business dangerously exposed to product obsolescence.

In order to plan your inventory requirements effectively, a whole range of factors have to be taken into account. From aligning purchase decisions with the business objectives to actually executing the purchase orders with suppliers, this article aims to explore what can be done to help prepare your operations for supplier closures.

Harnessing internal collaboration

Before you can begin to put in place a strategy to manage supplier closures, it is important that you fully understand the expectations from the wider business. For example, on one hand, the management may be highly adverse to risk and thus unwilling to invest in high levels of stock. Equally, the management may be more focused on maximizing sales or customer satisfaction. In this instance, stock availability will be seen as a priority and there may be more willingness to invest in high levels of stock to mitigate any disruption. Either way, the overall corporate objectives should drive purchase decisions accordingly.

Furthermore, the supply chain team must work with the marketing and sales teams in order to plan for any promotional activity that could be affected by supplier closures. Given that the Chinese New Year closures typically occur only a matter of weeks before the spring season kicks off, failure to plan in advance could mean that the inventory required for a promotion is simply not available. In order to achieve the volumes of stock required to launch a promotion, it is advisable to start planning as early as 5 months before any planned campaign is due to kick off.

Forecasting and anticipating demand

In order to determine your inventory requirements, it is vital that you have insight into future demand. Considering that you may need to plan several months in advance, this will mean utilizing historic demand patterns to create long distance forecasting. Given the extensive range of factors such as trend and seasonality that have to be taken into account when developing a forecast for each item, it is important that you have the tools in place to forecast as accurately as possible.

Exploring your option through scenario planning

While forecasts will provide you with visibility in to how much demand to expect, deciding how best to meet the needs of your customers is something which requires considerable thought. After all, there are lot of things that can change in the business environment which may impact the accuracy of the forecast.

For mature items with consistent demand patterns, this is probably not too much of an issue. However for new items or items with volatile demand patterns, this is something which must be managed carefully. After all, if you decide to invest in three months’ worth of stock to cover demand while your suppliers are closed, can you be sure that these items will actually sell? Equally, if you decide not to purchase these items, will you leave your customer disappointed?

In order to make informed decisions, you should explore your options fully. Through utilizing scenario planning, you can begin to understand how making a purchase order (or not) will impact your business’ ability to meet the overall objectives. Part of this process could include reviewing your product classifications in order to identify key focus areas. For example, you may want to focus more of your attention on securing A-line items as oppose to the C-line items which are likely to be of lower strategic value. This in turn can help when deciding whether or not to place an order.

Whether this be assessing the potential financial return or identifying the impact on the service level, scenario planning will enable you to focus your resources on the most important items and ensure that any investment in stock is in line with the wider business.

Building relationships with suppliers

Although in a perfect world, suppliers would deliver all orders, on time, in full, 100% of the time, this is simply not possible in reality. Given that the disruption before, after and during the Chinese New Year period may result in longer lead times, supply bottle necks or even missed orders, it is important that your inventory requirements are communicated well in advance to ensure you receive orders in time.

Forecasting and anticipating demand

In order to determine your inventory requirements, it is vital that you have insight into future demand. Considering that you may need to plan several months in advance, this will mean utilizing historic demand patterns to create long distance forecasting. Given the extensive range of factors such as trend and seasonality that have to be taken into account when developing a forecast for each item, it is important that you have the tools in place to forecast as accurately as possible.

Exploring your option through scenario planning

While forecasts will provide you with visibility in to how much demand to expect, deciding how best to meet the needs of your customers is something which requires considerable thought. After all, there are lot of things that can change in the business environment which may impact the accuracy of the forecast.

For mature items with consistent demand patterns, this is probably not too much of an issue. However for new items or items with volatile demand patterns, this is something which must be managed carefully. After all, if you decide to invest in three months’ worth of stock to cover demand while your suppliers are closed, can you be sure that these items will actually sell? Equally, if you decide not to purchase these items, will you leave your customer disappointed?

In order to make informed decisions, you should explore your options fully. Through utilizing scenario planning, you can begin to understand how making a purchase order (or not) will impact your business’ ability to meet the overall objectives. Part of this process could include reviewing your product classifications in order to identify key focus areas. For example, you may want to focus more of your attention on securing A-line items as oppose to the C-line items which are likely to be of lower strategic value. This in turn can help when deciding whether or not to place an order.

Whether this be assessing the potential financial return or identifying the impact on the service level, scenario planning will enable you to focus your resources on the most important items and ensure that any investment in stock is in line with the wider business.

Building relationships with suppliers

Although in a perfect world, suppliers would deliver all orders, on time, in full, 100% of the time, this is simply not possible in reality. Given that the disruption before, after and during the Chinese New Year period may result in longer lead times, supply bottle necks or even missed orders, it is important that your inventory requirements are communicated well in advance to ensure you receive orders in time.

Executing the order

Only once you have agreed on the business goals, established your exact requirements and decided upon a suitable supplier, can you then raise the purchase order.

While the Chinese New Year holiday can have a major impact on global supply chains, this is not the only scheduled disruption that businesses should worry about. Throughout the year, there a range of events such as Christmas or even the extended summer holiday taken by some Southern European nations that may result in supplier closures. Consequently, there must also be a process in place to ensure that such issues are planned for appropriately.

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  • Published in Blog, News
ABC-analysis

Defeat your assortment demons and go beyond the 80:20 rule

Saturday, 07 April 2018 by dweir

Defeat your assortment demons

5 Steps to help you redefine your approach to inventory

It is no secret that for many businesses, 80% of the turnover is generated by just 20% of the assortment. Given that such a large proportion of the assortment seemingly offers such little value to the business, you would be forgiven for focusing all of your attention on the best performing lines. However, inventory decisions should not be taken lightly and businesses should strive to manage their entire assortment as effectively as possible.

How can you maximize the performance of your assortment while minimizing unnecessary costs? This article highlights 5 top tips to help boost the profitability of your assortment, minimize risk and help you manage your inventory more effectively.

Striking the balance

Unless you have a complete understanding of your assortment, how can you be sure that you are making the right inventory decision? After all, while a slow moving line may seem like a costly waste of space in your DC, for certain customers, these items could well be the main reason they buy from your business. Equally , if an item offers only a minimal return in terms of customer benefit or profit, is it worth investing time and money ensuring this item is always available?

Although overall availability is seen as one of the key performance indicators when it comes to inventory management, supply chain managers have to draw a line somewhere. Through finding the balance between investment in inventory and service levels, businesses can exploit the laws of Pareto principle in order to adopt a more proactive approach to managing the entire assortment.

The right criteria for the right classification

Should a slow moving item really be managed the same way as a fast moving line? When you consider that every item will have a unique demand pattern and margin, applying the same inventory strategy across the entire assortment is neither profitable nor logical.

This is where inventory classification comes in: through categorizing items depending on their strategic importance to your business, you can begin to adopt a more tailored approach to manage each category. This in turn enables you to focus resources on the areas which require the most attention.

For many businesses, a well-structured ABC analysis can provide the insight required to categorize items effectively. While the process on conducting an ABC analysis allows you to gain a greater understanding of the assortment, it is essential that the parameters of the analysis are well aligned with the business’ overall objectives. Furthermore, it is also important that it is clear who has the final say on what parameters should be used and that these are well communicated with the business’ decision makers. After all if your business is focused on customer satisfaction, categorizing items by margin alone will do little to help the business achieve its goals.

How you define the boundaries within your assortment will depend heavily on what KPIs are most important to your business. Essentially, there are two main objectives which determine the KPIs: on one hand the focus can be on the profit margins of an item or the turnover. Alternatively however, the financial elements can be put to one side and customer satisfaction in the form of order lines or transactions can be used as the foundation on which to build KPIs. However, in addition to this, the following questions must also be raised when determining which category each item falls into:

  • What items should be included? Which items should not be grouped?
  • What are the basic criteria for ABC analysis?
  • Dynamic or static? How often should ABC be recalculated?

How much do you really know about your assortment? Do you know which items offer the greatest return or which are most important to your customers? Equally, do you know which items are costing you money? This article highlights 5 top tips to help boost the profitability of your assortment, minimize risk and help you manage your inventory more effectively.

Acting on insights

Once the boundaries of an ABC analysis have been defined and agreed upon, your assortment can be categorized into different groups depending on strategic importance. From service levels to stocking decision, the insights provided by the ABC analysis should be used as a driving force to shape your assortment and optimize the performance of all your items.

Here are 5 steps you can adopt today to help reduce inventory levels, increase availability and ultimately help ensure your business achieves its overall corporate goals.

Step 1: Differentiate your service level

In the context of assortment management, a service level is the target % of all ordered pieces of an item that can be delivered from stock at the first requested delivery date. Given that A-line items are those which are most important to the business, whereas C-line items are likely to be slowing moving items which offer a much lower return, there is little point in setting the same service level targets.

For A-line items, the service level target should be the highest of the three categories. On the other hand, considering that B and C class items are likely to have a lower overall impact on your business’ strategic goals, setting an excessively high service level target could result in unnecessarily costs yet deliver only a small return. As a consequence, it is essential that service levels are considered carefully in order to ensure that they are both realistic and relevant to the goals of the business.

Step 2: Determine the right stock levels

Once you have defined the desired service level for each classification, you can continue to re-assess your inventory policy. Given that the level of insurance inventory will differ depending on the importance of each item, it is enviable that A-line items are likely to have a greater requirement for safety stock as going out of stock could cost the business dearly.

However, this is not simply a case of investing heavily in safety stock for your best performing lines while ignoring C-line items. While insights from a well-structured ABC analysis can be used to guide a differentiated approach to service levels, there are still a number of factors that have to be taken into account. For instance, could certain items have a political impact on the business which require special attention? Or are there already contractual or customer obligations in place?

Through carefully considering the inventory requirements of each category, your business can optimize stock levels in order to ensure that, where required, demand is covered with safety stock while cutting excess stock across the rest of the assortment.

Step 3: Make more informed stocking decisions

In addition to optimizing inventory levels, the insights from conducting an ABC analysis may identify further opportunities to refine the assortment. For instance, some C line items may actually not be worth stocking at all as they simply do not offer a significant enough margin to justify holding on stock. Alternatively, there may be a number of items which are currently non-stocked which would actually be better to keep stocked at all times. This is particularly true for items where there is either a lengthy lead time or low level of supplier reliability.

Through utilizing the insights from an ABC analysis to decide whether or not to change the stocking status on an item, you can boost customer satisfaction by ensuring the most important items are readily available. Equally, through using such insights to refine your assortment, you can remove items which do not contribute towards achieving the overall business goals. This in turn can help free up working capital which can then be reinvested elsewhere in the business.

Step 4: Optimize here, optimize there

With clear insight into which items have the biggest impact on your ability to achieve your strategic goals, you can prioritize areas which require the most attention. Whether this means taking time to re-negotiate lead time or order quantity with suppliers or develop more effective means of managing such items, the outcomes of the ABC analysis will aid you when structurally improving the way you manage your inventory.

When you consider that your A-line items are likely to be the best performing lines, negotiating more favorable lead times, or even better prices, could have a major impact. Likewise, for items which you identify as slow movers, the opportunity may arise to negotiate a smaller order quantity which in turn will result in you holding less stock.

While on an article level, these relatively minor developments may only seem to have a small impact, across the entire assortment, these can soon add up. In turn, such action can help improve overall availability, reduce inventory cost and generally improve efficiency across the board. Through utilizing the ABC analysis, you can clearly see exactly where you need to prioritize time and resources in order to deliver the most value to the business.

Step 5: Monitor, report, review

Given that the previous 4 steps could have large potential impact on the performance of your business, it is important to monitor the effectiveness of inventory decisions in order to ensure you are moving in the right direction.

While overall stock value or overall availability could be used to compare year on year performance, unless you dig a little deeper, you will not be able to identify exactly which aspects of your assortment are performing well and which require more attention. Given that the service levels for each category are likely to be driven by very specific objectives, categorizing items according to ABC classifications is a powerful way to monitor the evolution of your assortment.

Through reviewing each category that arises as a result of the ABC analysis, you can gain a much clearer picture of how your assortment is performing. Consequently, this provides you with time to investigate potential problem areas and respond accordingly. Furthermore, these categories provide a solid basis on which to report such developments to other areas of the business.

Published by Slimstock, market leader in forecasting, demand planning, and inventory optimization

Since 1993, Slimstock has been synonymous with better demand forecasting, effective inventory optimization, clearer inventory analysis and continuous improvement of inventory reliability. Our customer base consists of over 650 companies worldwide, across a diverse range of industries, covering large, medium and small enterprises.

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  • Published in News
George East Carl Debbage

George East set a new benchmark for all future improvement projects with Slimstock

Friday, 20 October 2017 by dweir

The business behind some of Britain’s leading kitchenware brands including Tala and ChefAid, has established a new benchmark by which all future supply chain projects will be judged. Following the success of a major project focused on improving both stock availability and efficiency this month, the leading kitchenware supplier, George East, has already started to realise the tangible benefits of their work with inventory management specialist, Slimstock.

With a broad range of products and an extensive customer base encompassing a number of well-known high street retailers, George East is one of the UK’s leading suppliers of kitchen and homeware products. Carl Debbage, Commercial Manager at George East explains: “Given the complexity of our global network of suppliers, coupled with the continuous growth of our assortment, it was vital that we took steps to improve both availability and service levels in order to keep up with the growing demand for our products.”

After seeing how Slimstock’s inventory management solution, Slim4, could help the business better manage seasonal demand and product lifecycles, the homewares specialist decided to join their parent company, Nedac Sorbo group, as one of 650+ other businesses to implement Slimstock’s inventory management solution, Slim4. Debbage goes on to add: “Although we have only been using the solution for a short time, I can already see how critical Slim4 has become for our operations.”

Since the project was first initiated in November 2015, the team at George East have already started to notice the business benefits. “Working with the team at Slimstock on what has been a highly complex project has been a pleasure. The expertise of the consultants at Slimstock has been evident throughout and it has been a great experience in how a project should be managed. Slimstock has helped us establish a new benchmark by which all future projects will be judged,” States Debbage.

Richard Evans, managing director at Slimstock UK goes on to add: “This has been an exciting project for everyone here at Slimstock and I am confident that our work with George East will help the business go from strength to strength.”

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  • Published in News
Roper Rhodes

Roper Rhodes set to bathe in supply chain success with Slimstock

Friday, 20 October 2017 by dweir

To help maintain and improve their market leading availability across their stylish range of bathroom furniture products, Roper Rhodes has taken a major step towards bolstering their position as the UK’s favourite independent bathroom specialist. Following the decision to partner with Slimstock, the bathroom specialist will utilise the inventory management expert’s supply chain solution, Slim4, to increase customer service levels and support the business' continuous growth.

With customers ranging from national merchant groups to local authorities, housing associations and plumbing contractors, Roper Rhodes has provided customers with a complete range of functional and stylish bathroom furniture for over 30 years. With the support of Slimstock, the UK’s favourite bathroom supplier will now utilise Slimstock’s inventory optimisation solution, Slim4, to modernise their approach to inventory management.

“In the past, we relied upon our ERP system to help manage our inventory. However, as the business has grown, we knew that this approach was simply no longer optimal,” explains John Wright, Operations Director at Roper Rhodes. With an already extensive range encompassing; sanitary ware, showers, taps and bathroom accessories, the business required a solution which could enable the team to forecast demand with greater confidence and thus, manage their ever-evolving assortment more effectively.

With the ability to anticipate demand with much greater accuracy, once Slim4 has been implemented, the team at Roper Rhodes can focus more of their time and attention on what really matters to their customers. “Given Slimstock’s extensive industry experience, flexibility and robust project methodology, it was obvious that they were the right partner for us,” adds John.

Richard Evans, Managing Director at Slimstock goes on to conclude: “As we embark upon this project, I am confident that our work with Roper Rhodes will help the business on their journey towards supply chain excellence.”

 

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  • Published in News
Stena Line chooses Slim4

Stena Line chooses Slim4 for inventory management

Friday, 29 September 2017 by Arjan Bartelds

One of the world’s leading ferry operators Stena Line has decided to implement Slimstock's inventory optimisation solution, Slim4, to optimise the inventory of its central DC in Malmö. Onboard stores, restaurants and bars for more than 40 vessels are replenished from this DC and four regional DC's.

Stena Line provides ferry transportation services on its extensive route network of twenty routes covering North Europe and connecting ten countries. Last year, approximately 7.3 million passengers, 1.6 million cars and 2 million freight units were taken across the waters around Scandinavia, on the Baltic Sea, the North Sea and the Irish Sea.

The replenishment of the vessels is taken care of by Stena Line Onboard Services. This subsidiary and unit within Stena Line is responsible for the replenishment of the onboard shops, restaurants, cafés and bars. They are located in Malmö, with a purchasing team and a central warehouse. There are smaller DCs in Holyhead in Wales, Hoek van Holland in the Netherlands, Gdynia in Poland and Gothenburg in Sweden.

Stena Line decided to implement Slim4 to reduce inventory, improve efficiency and maintain the high service levels towards the vessels. The implementation will start in September and is planned to be finished before the end of the year. During the project an interface will be made between Slim4 and the ERP system Oracle JD Edwards.

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  • Published in News
Drive Producrs

Drive Products replaced popular software with Slim4 for better results

Friday, 29 September 2017 by Arjan Bartelds

Since 1983, Drive Products has supplied truck mounted equipment for commercial vehicles from operations across Canada. By replacing their existing planning tools with Slimstock’s software, Slim4, they immediately realized inventory could be further reduced by $6Million, and the end is not in sight.

Drive Products is the country’s leading integrator for commercial vehicles. Next to sourcing truck mounted equipment, the company specializes in installation and repair services. The inventory contains 412,600 SKUs, which includes anything from snow plows to bulk transport, towing & recovery solutions, to garbage truck equipment. Mike King, corporate manager supply chain operations explains; “If it can be attached to a truck, Drive Products most likely sells it.”

Slimstock supplants the competition

Due to several acquisitions, the assortment of inventory at Drive Products grew fast and relying on support for their outdated software was turning inventory management into a complex task. To get rid of excess inventory and re-balance it across their distribution network, Drive Products decided to integrate Slimstock’s, Slim4 to their Great Plains ERP and replace their outdated planning solution. “Our previous solution was rather cumbersome to use,” says King. “We considered upgrading with the same vendor, but experience with their support had not been positive. Replacing it with Slimstock’s software was a good choice for us. It far exceeds the speed, accuracy, and performance of our previous solution. The support from Slimstock has been outstanding in comparison too.” The implementation completed well under budget and Slim4 immediately highlighted $2Million in excess purchase recommendations from the previous planning solution.

A clearer insight into irregular demand

Canada’s weather has a tremendous influence on Drive Products sales. Slim4 automatically recognizes seasonality, and based on predictions; we can assure sales that the right products will be available when needed. “Due to a more stable forecast, we have fewer short shipments from suppliers,” says King. He adds, “Slim4 isolates exceptions quickly and alerts us to trends. I now have much clearer insight into irregular demand too. Slim4 provides greater visibility than I ever had before.”

Inventory reduced by more than $ 6M

Previously, A-items made up a large portion of Drive Products’ stock, but only turned 4.8 times a year. With help from Slim4, the inventory value has been reduced by almost $ 6Million and the stock turn has doubled on many items. “Reducing inventory is about as easy as pulling a few levers now,” says King. He adds; “We’ve further centralized our planning process, which has drastically improved efficiency. Previously it took us three days to determine purchase requirements for just one location. Now it takes one day to buy for the entire company, and I can manage it all from one location”, explains King. “I now have more control over stock. We can see where we’re over, rebalance inventory for the start of a season, and stop out of season purchases before they affect our balance sheet.” King foresees a bright future. “I don’t have a lot of spare minutes in my day,” Says King; “but Slim4 is quick. It’s an efficient solution that has positively influenced the performance of our business.”

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  • Published in Automotive, News, Wholesale
Slim4 in use

Should you implement Slim4 before or after your new ERP is operational?

Wednesday, 30 August 2017 by Arjan Bartelds

Upgrading an ERP system requires a huge amount of time and effort from everyone across the organisation. Thus, it may seem like a strange time to be thinking about bolting-on additional solutions.

However, when you consider that implementing a new ERP could take over 18 months to complete, a period which is likely to be full of trials and tribulations, having a tool in place that enables you to stay in complete control of your inventory during the transition will bring harmony to the ERP project. The question is, should you implement our inventory management solution, Slim4, before or after a new ERP is live?

There are solid arguments for implementing Slim4 before and after a new ERP system has been introduced. Ultimately, this decision will depend on your specific business circumstances. Download our infographic guide and explore which option is right for your business today.

Complete the form below to download our guide to implementing Slim4 before or after your new ERP system.

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