Supply Chain Strategy

For a business to succeed, the inventory strategy must align with the overall corporate vision of the organization. However, when it comes to executing the supply chain strategy, even seemingly small inventory management decisions can have a profound and far-reaching impact across the rest of the organization. As a result, it’s vital that supply chain planners have the level of insight and control required to execute supply chain tasks effectively. Put simply, without the right tools, technology, and knowledge in place, businesses simply cannot make optimal inventory decisions.

Portfolio & range management: optimize your investments in inventory

It is no secret that for many businesses, 80% of the turnover is generated by just 20% of the assortment. Thus, it is vital that organizations only invest in items that add value to the business or its customers. Slim4 ensure optimal stocking decision-making by fully supporting portfolio & range management process:

  • Make effective stocked/ non-stocked decisions based on the organization’s specific business rules
  • Collaborate with marketing to optimize assortment decision & prevent excess stock in the face of price changes

ABC / XYZ analysis: understand your assortment

In pursuit of a unique selling point, many businesses have developed extensive assortments encompassing many thousands of SKUs. While this ensures that businesses are able to provide customers with a huge amount of choice, managing such a large number of items puts a huge amount of stress on the business both in terms of time and cash flow. To help maximize the value of the entire assortment without compromising the organization’s ability to meet the needs of their customers, the ABC/ XYZ functionality of Slim4, provides supply chain teams with greater visibility and focus:

  • To provide a solid basis for service level differentiation, Slim4 supports ABC analysis based on a range of metrics, depending on what fits best for your specific industry
  • Unlike other systems, which look back to identify successful items, Slim4 can also base ABC analysis on forecasted demand
  • Slim4 enables separate ABC analysis to be run across different departments (warehouse, sales, etc.)

Product Life Cycle Management (PLC): the right strategy for every phase

Effective Product Life Cycle Management is all about adopting the right strategy at every phase. However, given that no two product life cycles are ever the same, it’s vital that inventory levels are managed carefully to maximize availability during the introduction, growth and mature phases as well to minimize obsolescence at the end of the life cycle. Slim4 helps businesses stay ahead of product life cycles:

  • Automatically adopt the inventory strategy to full optimize the entire product life cycle
  • Apply business rules to adopt either a defensive or aggressive approach during launch phase
  • Remain responsive and automatically establish a forecast after initial sales of new items
  • Optimize margins and inventory costs for mature items
  • Notify planners when sales start to fall at the end of product life cycle
  • Gain insight into different phase-out scenarios and decrease inventory levels accordingly

Service level differentiation: focus your time, resource and investment

In a perfect world, businesses would maintain 100% availability across every item. However, in reality, this is neither achievable nor beneficial to the organization. As a result, businesses must focus their time, attention and financial investment on the products that matter most. Slim4 literally stands for Service Level Inventory Management and supports businesses with the following capabilities:

  • Automatically sets service levels based upon ABC and the business rules in place
  • Optimize safety stock to achieve desired service level and thus maintain high levels of availability

Obsolescence management: minimize waste

Sustainability is no longer just a trend, it is the new reality. Organizations today simply can accept obsolescence as a result of poor inventory management. With Slim4, planning teams can proactively avoid excess and thus minimize obsolete cost. Slim4 enables businesses to achieve the following:

  • Factor in product shelf lives into the inventory management process to improve product quality & maximize sales opportunity
  • Protect margins through minimizing shrinkage

Multi echelon inventory optimization (MEIO): Minimum supply chain costs across the entire network

Businesses today exist in far more complicated environments than ever before. Consequently, achieving stock availability in complex omni channel and multi-site environments, has never been more difficult. With Slim4, businesses can adopt a holistic approach over their entire supply chain operations:

  • Strategically allocate safety stock to maximize availability across the chain while simultaneously minimizing overall investment in inventory
  • Take into account inventory & demand at all levels of the operation
  • Adopt a multi-echelon model taking into account your specific network characteristics (e.g. number of branches, internal lead times, volatility in demand)

Supply chain collaboration (SCC)

Given that a business can only ever be as successful as the weakest leak in the chain, the reliability of suppliers can have a major influence on performance. After all, an unreliable supplier will only cost your business money and kill your service levels. Slim4 helps businesses to enhance end to end supply chain collaboration in order to build stronger ties with supply chain partners:

  • Enables easy sharing of supply chain data including stocking decisions, EOQ and purchase forecasts

Sales and operational planning (S&OP)

From deciding whether or not to stock a new product to determining how best to overcome a supply shortage, the impact of supply chain decisions extends far beyond the supply chain team. Furthermore, the insight required to make such decisions often require inputs from across the business. Slim4 helps businesses optimize their S&OP process in order enhance collaboration between different departments:

  • Slim4 supports the entire S&OP process
  • Aggregate demand at different hierarchical levels to support specific S&OP processes
  • Slim4 aligns statistics with external forecasts

Business rules

Slim4 is a standard software solution. However, in order to ensure that day to day inventory management processes and decisions align with the overall corporate strategy, businesses rules can be applied to optimize the solution for specific environments. Through utilizing business rules, Slim4 removes the need for “gut-feel” when defining the inventory and replenishment strategy:

  • Standardized logic ensuring that everyone works in the same way towards the same goal
  • Maximize efficiency through automation based upon if-this-then-that type logic
  • Unlike in ERP systems, parameters can be changed dynamically

Customer segmentation: Identify what matters most to your customers

Purchasing behavior will differ hugely between different customer groups and consequently, the importance of each item will vary dependent on the customer in question. With Slim4, it is possible to not only define A, B & C items but also A, B and C customers:

  • Establish different rules around stocking decisions, safety stock requirements and the need for dual sourcing depending on both the item and customer class
  • Slim4 provides specific exceptions to enable supply chain teams to react to the evolving needs of priority customer immediately

Execute your supply chain strategy with Slim4

Tried and tested by over 700 customers worldwide, Slimstock’s inventory manage tool, Slim4, has a proven track record for helping businesses optimize their supply chain processes. Customer of Slim4 typically enjoy huge improvements in customer satisfaction while simultaneously reducing inventory & supply chain costs.

REFERENCES

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