Australia’s evolving labour market and industrial shifts have pushed our imports to exceed the US $200 billion per annum, adding a layer of complexity to the business landscape – where, how, and for how much to import. Manufacturers face the decision of whether to import or continue manufacturing, and this decision has become a trade-off between costs, efficiency, and value-adding activities. Our imports are made up mostly of vehicles, machinery, and electronic equipment, and come primarily from China, the US, Japan, South Korea, Thailand, and Germany.
What does this mean for inventory management?
In most cases, longer lead times. The difficulty here is that it greatly extends the planning horizon, and one needs to deal with a longer period of uncertainty in demand. This increases the importance of a proper forecast.
This article describes four steps that will help you with improving your companies’ inventory based on demand forecasting.